GM sees a 14% decrease in its net profit in the first quarter of 2013

Article by Christian A., on May 3, 2013

General Motors experienced a 14% decrease in its net profit in the first quarter to $865 million amid the decline in earnings in North America and as European losses dropped. For the period from January to March, GM was profitable – its 13th straight month of earning a profit after it exited from a government-led bankruptcy in the middle of 2009.

These figures are inclusive of one-time costs that removed $170 million from the net profit of GM. The earnings before interest and taxes and with the exclusion of one-time items (the figure that GM thinks is the best measure of its results) decreased by 19% to $1.76 billion. Its pretax profit in North America decreased by 14% to $1.41 billion. According to GM, its bottom line was affected by weaker pricing and lower production volumes in North America.

It fell by about $400 million compared to the previous year. CFO Dan Ammann said that the lower pricing and wholesale deliveries to dealerships were partly because of the changeover to GM's next-generation full-sized trucks.

GM had temporarily suspended operations at its pickup plants to prepare for the production of the redesigned 2014 models. It’s set to be launched within weeks. The company is offering huge discounts for the models on their way out. Full-sized SUVs are expected to follow. In the first quarter of 2013, GM’s average incentives (a percentage of the average transaction price) increased to 11.5% from 10.4% for the same period the previous year.

GM said that on average, its incentives in the first quarter were 16% higher than that of the industry. In a statement, CEO Dan Akerson said that European pretax losses fell to $175 million, from a $294 million loss the previous year due to “strong cost actions" and sales of newly launched vehicles like the Opel Mokka small crossover. Ammann said that GM is maintaining its target of achieving breakeven in Europe by the middle of the decade even when he hasn’t seen signs that Europe’s recession will ease up soon.

Topics: gm, profit

If you liked the article, share on:

Comments

Recommended

We first heard of the fifth generation SEAT Ibiza earlier this year, and last week, the company finally revealed the all-new Ibiza at the international launch in Barcelona. The new...
by - May 22, 2017
The aftermath of the Takata airbag recall still largely resounds in the automotive industry, as big automotive companies like BMW, Mazda, Subaru and Toyota were extensively hit with what is...
by - May 22, 2017
Amid reports that major rival Volkswagen would cease producing 2016 and 2017 model year diesel cars following the wake of the "Dieselgate" scandal, it’s believed that Chevrolet sees its opportunity...
by - May 22, 2017
Honda recently whips out a new feature for the S660 Bruno Leather Edition. Any guesses? Well, it’s going to be an iPhone app that goes by the name Rev Beat....
by - May 22, 2017
And so it goes, Ford is not at all closing its doors to an all-electric F-150 pickup. The American manufacturer initially laid out its plans for an F-150 hybrid earlier...
by - May 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries