Top
executives stole the pension money, shareholders and employees left
to die --- Max
Keiser
GM
profits slip 41% as European struggles take their toll
America's
largest car firm made $1.5bn in the second quarter of 2012, with
European division reporting operating loss of $361m
2
August, 2012
General
Motor's profits fell 41% in the second quarter as troubles in Europe
undercut strong sales in North America.
America's
largest automaker made $1.5bn in the second quarter of 2012, compared
with $2.5bn for the same period last year. Revenue fell to $37.6bn
from $39.4bn in the second quarter of 2011. The results exceeded
analysts' estimates, but further underlined Europe's drag on the US
economy.
"Our
results in North America were solid, but we clearly have more work to
do to offset the headwinds we face, especially in regions like Europe
and South America," said GM chairman and CEO Dan Akerson.
"Despite the challenging environment, GM has now achieved 10
consecutive quarters of profitability, which is a milestone the
company has not achieved in more than a decade."
GM's
European division reported an operating loss of $361m, compared with
an operating profit of $102m a year ago. GM is attempting to
restructure the unit and recently replaced several of its top
executives in Europe. The company is planning to close at least one
plant in Europe by 2016, but Dan Ammann, GM's chief financial
officer, said there were no immediate plans to announce more job cuts
or factory closings in Europe.
In
North America, GM reported an operating profit of $1.97bn, which
compares to a profit of $2.25bn for the same period a year earlier.
The company posted a loss of $19m in South America during the second
quarter, and made a profit of $557m in its international division,
primarily in China.
While
GM's North America sales remain strong there are signs that the
slowdown in the US economy is taking its toll. On Wednesday, GM and
Ford announced that sales had slipped in July; GM deliveries fell
6.4% and Ford 3.8%, according to statements. Chrysler increased
deliveries by 13%.
GM's
fortunes have recovered dramatically since its emergence from
bankruptcy in 2009. The firm said it sold 2.39m cars during the
quarter, compared with 2.32m a year ago. GM had $32.6bn in cash
reserves and other liquid assets at the end of the quarter.
Its
government-backed bailout has become a political hot topic. Mitt
Romney has been a persistent critic of the bailout and is running ads
that highlight the plight of auto dealerships closed as a condition
of the government-managed bankruptcies.
In
turn, president Barack Obama has consistently championed the bailouts
for saving over a million US jobs and criticised Romney for his 2008
New York Times editorial entitled "Let Detroit Go Bankrupt."
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