General Motors Corp. said Oct. 25 it was on the road to recovery after posting a much smaller net loss of $115 million in the third quarter. In the same quarter of 2005, GM posted a net loss of $1.7 billion.
Third-quarter revenue was $48.8 billion. Excluding special items, such as charges for a reorganization under way at GM's bankrupt former parts division Delphi, the auto group would have made a profit of $529 million in the past quarter.
GM chief executive Rick Wagoner said the third-quarter results reflected "significant progress" in the company's hard-hitting recovery plans, after it lost a record $10.6 billion last year. Turnaround efforts in North America and Europe were "well under way," said Wagoner."This improvement in North America and Europe, combined with the strong sales growth and earnings performance we see in Asia and Latin America, confirm that our plan is on track."
In the past quarter, GM's North American operations posted an adjusted net loss of $367 million, a $1.3 billion improvement year-over-year, despite a decrease in production of 96,000 units. GM said the improvement largely reflected improvements in structural costs, as it implements pension, healthcare and manufacturing cost reductions. Cost reductions are on track to total $6.0 billion in 2006.
GM Europe reported an adjusted net loss of $16 million, compared to the prior year's loss of $121 million. "Our turnaround in Europe is in full gear," Wagoner said, noting record quarterly sales in Europe for the Chevrolet brand.
GM Asia-Pacific posted a smaller adjusted net income of $83 million, down from $188 million. That was down mainly to GM's reduction of its equity stake in Japanese unit Suzuki and new product costs in Australia.
But GM said it also enjoyed record third-quarter sales in China of 192,000 units, up 17% from last year.
Copyright Agence France-Presse, 2006