Filed under: GM, Earnings/Financials
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General Motors reported its third-quarter earnings today, and while revenues were up in the three-month period, overall profits were down 14 percent compared to last year. GM’s Q3 net revenue was $37.6 billion (almost $1 billion more than 2011), but its net income was $1.5 billion, down from $1.7 billion last year. This is the opposite trend from Chrysler and Ford, which were both up considerably.
According to Automotive News, GM’s lower profit came from a combination between the flailing European car market and the increased production of small cars. Losses in Europe grew from $292 million in Q3 2011 to $478 million in Q3 2012, and since 1999, GM has lost more than $17 billion in this market. Also, with new cars like the Chevy Sonic and Spark growing in popularity, these smaller cars have less of a profit margin than GM’s SUV cash cows, but the improvements in small cars is helping in markets such as South America.
The South American market has recovered from previous losses to give GM a $114 million profit last quarter, and these numbers are expected to continue climbing thanks to new vehicles like the all-new Chevrolet Onix unveiled last week at the São Paulo Motor Show in Brazil. Another bright spot for GM was that its pension liability dropped by $29 billion thanks to about 30 percent of salaried retirees in the US accepting a lump-sum payment; both figures are higher than GM initially expected.Continue reading GM profits down 14% in Q3
GM profits down 14% in Q3 originally appeared on Autoblog on Wed, 31 Oct 2012 12:59:00 EST. Please see our terms for use of feeds.
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