General Motors reports $3 bn loss in 3Q due to Opel sale charge
New York (AFP)
General Motors reported Tuesday lower North American operating profits, but gains in other regions as a $5.4 billion charge connected to the Opel/Vauxhall sale led to a large quarterly loss.
The biggest US automaker reported a loss of $3 billion for the quarter ending September 30 due to one-time costs associated with the Opel/Vauxhall deal. GM in March announced the sale of its European division to PSA Groupe for $2.3 billion.
Revenues were down 13.5 percent to $33.9 billion.
North American demand for autos has ebbed in 2017 after a multi-year boom, leading GM to curtail car production at some US plants for some less-popular sedan models.
Earnings in the region were also expected to be dented by increased dealer incentives to offload lower-selling models. Offsetting these trends was a jump in demand in Texas in September and other flood-ravaged regions due to hurricanes Harvey and Irma.
GM's operating profit in North America fell 42.2 percent to $2.1 billion.
However, operating profits rose in GM's international operations division, and the company swung to an operating gain in South America from a loss in the year-ago period.
Operating earnings translated into $1.32 per share, above the $1.13 expected by analysts.
"Solid performance in all operating segments led to a very good quarter. With an aggressive vehicle launch cadence through the fourth quarter and an ongoing intense focus on costs, we project strong results through the end of the year," said GM chief financial officer Chuck Stevens.
Most of the charge related to the Opel/Vauxhall sales consisted of $4.3 billion in tax assets that won't be realized due to the transaction.
GM shares rose 4.1 percent to $47.
© 2017 AFP