EarningsCenter

GM Profit Hit by Lower North American Earnings, Losses in Europe

gm earnings dan akerson
Getty ImagesGeneral Motors CEO Dan Akerson.
By Dee-Ann Durbin

DETROIT -- General Motors' net income fell 14 percent in the first quarter, as it earned less money in North America while preparing to launch a redesigned version of its best-selling vehicle, the Silverado pickup.

General Motors Co. (GM) earned $865 million, or 58 cents a share, down from $1 billion, or 60 cents a share, in the January-March period a year ago. But excluding one-time items, GM's earnings of 67 cents a share topped analyst forecasts for 54 cents, according to FactSet.

Revenue also topped Wall Street expectations, and the company lost less money in Europe than a year ago. Shares rose 3 percent to $31.10 in premarket trading.

Worldwide sales rose 3.6 percent to more than 2.3 million. GM had record sales in China, and it boosted its share of the North American market as sales in the U.S. rose 9 percent.

GM's earnings in North America fell 12.5 percent from a year ago to $1.4 billion. Chief Financial Officer Dan Ammann said the drop was due to reduced shipments of pickup trucks ahead of the launch of GM's newly redesigned Chevrolet Silverado and GMC Sierra full-size pickups. Those go on sale in a few weeks. Auto companies book profits on a vehicle when it leaves the factory.


GM sold a record 816,373 vehicles in China, up 10 percent from the first quarter a year ago. Among the hot sellers was the Cadillac XTS full-size sedan, which went on sale in China in February. Chinese buyers snapped up more than 2,000 XTS sedans in March alone, despite their steep starting price of $56,000.

Profits in GM's international operations, which includes China, fell 5 percent to $495 million. Ammann said gains in China were offset by weakness in other regions, including India.

The XTS and smaller ATS also gave GM a boost in the U.S., where GM sold 664,964 cars and trucks in the quarter and outpaced the industry's gain of 6 percent. U.S. Cadillac sales jumped 38 percent while Buick sales were up 27.5 percent thanks to the new Verano small car and Encore small utility.

Sales of the Silverado rose 22 percent in the U.S., boosted by an increase in home building and other construction.

In Europe, where the government debt crisis and high unemployment have led to 18 straight months of declining industry sales, GM's loss narrowed to $175 million from $294 million a year ago. Ammann said GM isn't yet ready to say that the European auto industry has hit bottom, but the company is proceeding with its plan to invest in new products and close a German plant by 2014.

"There are things we can control and we're making good progress on those," he said.

GM's revenue fell 2.3 percent to $36.9 billion in the first quarter. One-time items included a charge for currency devaluation in Venezuela.

GM is the last of the Detroit Three to report first-quarter earnings. Ford Motor Co. (F) said last month its first-quarter profit rose 15 percent to $1.6 billion for the quarter while Chrysler Group's earnings fell 65 percent to $166 billion. Chrysler's earnings also were impacted by reduced vehicle shipments as it prepares to launch the new Jeep Cherokee.

(Updated at 10:35 a.m. ET)


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39 Comments

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ds6342

Good. After hearing that the company's high level execs want a raise, I'd never buy a GM car.

May 02 2013 at 9:20 PM Report abuse rate up rate down Reply
abcadams1

The only time GM made money was when the Government was running it. After the guy the Government hired to run the company, GM went back to private jets, firing all the women, and giving the CEO big money.

May 02 2013 at 4:34 PM Report abuse rate up rate down Reply
2 replies to abcadams1's comment
mdmichel8888

where do you people get this BS

May 02 2013 at 5:24 PM Report abuse -1 rate up rate down Reply
1 reply to mdmichel8888's comment
abcadams1

No BS. Only facts. GM bought up all the Government shares on December 26, 2012 (less than four months ago). They were posting record gains prior to late December. After the buyback, GM is now losing money again (like they did prior to the government takeover in 2009).

May 02 2013 at 5:53 PM Report abuse +1 rate up rate down
Leonard

Have you no shame, where do you get off telling lies as if they were facts. Do you work at Honda?

May 02 2013 at 7:07 PM Report abuse rate up rate down Reply
Rich

It's Government Motors. What do you expect? Buy Ford!

May 02 2013 at 4:23 PM Report abuse rate up rate down Reply
1 reply to Rich's comment
abcadams1

Not any more. That is why they are back to losing money. The government did not want them to have huge salaries and private jets. They made money by listening to the Government. Once they went private again, they started spending needlessly and profits started taking a hit again.

May 02 2013 at 4:36 PM Report abuse rate up rate down Reply
1 reply to abcadams1's comment
barbeo4

General Motors Co. (GM) earned $865 million, or 58 cents a share, down from $1 billion, or 60 cents a share, in the January-March ....cant you read?????

May 02 2013 at 6:53 PM Report abuse +1 rate up rate down
daddyo

nothing in their lineup that appeals to me. Chevy too cheap, Cadillac too plastic, Buick is an old person's car. What's left, a truck ?

May 02 2013 at 2:35 PM Report abuse -2 rate up rate down Reply
1 reply to daddyo's comment
Ken

Chevy to cheap? I bet if There was a chevy cruize or malibu parked next to a toyota camry, or any other mid sized car without the emblem on them, you couldn't tell the difference! They are all the same, only difference is reputation and mindset. the cruze, is car of the year again, gets 42mpg, and is a beautiful car. Silverado is so much better than any truck out there..I have owned 3 of them, my current on has over 260 thousand miles on it, runs great and only thing I have ever done to it is change the oil regularly. my last one I put over 700K miles on it before I gave it away

May 02 2013 at 3:42 PM Report abuse rate up rate down Reply
renner1234

Now wait, Obama said the economy is growing.

Does not sound so good.

What did the Government stop buying cars from GM.

Hay, I thought Joe Bidden was going to be working on Jobs, jobs, jobs.

Something is wrong. Would Obama Lie to us about the economy?

May 02 2013 at 2:32 PM Report abuse +1 rate up rate down Reply
1 reply to renner1234's comment
barbeo4

Hay, I thought Joe Bidden was going to be working on Jobs, jobs, jobs.
.....no that was your boy baynor

May 02 2013 at 6:54 PM Report abuse -1 rate up rate down Reply
Seth

From the article:
Ford Motor Co. (F) said last month its first-quarter profit rose 15 percent to $1.6 billion for the quarter while Chrysler Group's earnings fell 65 percent to $166 billion. (end)

So Chrysler made $166 BILLION? - I should have bought that FIAT Stock! (How about $166 million?) How much is that in Euros?

May 02 2013 at 1:53 PM Report abuse rate up rate down Reply
jaguare70

GM's Cadillac, is car of the year. What BS is being pushed by those with misguided political agendas.

May 02 2013 at 1:19 PM Report abuse rate up rate down Reply
richard

Looks like the Oriental supporters are out in full force today. And as usual, they don`t have a clue of what they`re talking about. Always good for amusement, these conservative goofballs are. Bash American GM, and crow for Japan. Dolts.

May 02 2013 at 1:18 PM Report abuse +3 rate up rate down Reply
cozzod

i just read the new consumer reports. the top 7 automobiles for quality are all out of japan.
all the cars made in detroit are all on the bottom of the list.
seems to me nothing has changed with GM. still makes a crap product.
want people to buy your cars, make a better car

May 02 2013 at 12:40 PM Report abuse +2 rate up rate down Reply
up.yours

I have an idea for GM: why not build better, affordable cars that people WANT?

May 02 2013 at 12:37 PM Report abuse -2 rate up rate down Reply