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Carmaker GM loses another $15.5bn
08/01/2008

Carmaker GM loses another $15.5bn

Rising fuel prices have hit used-car prices, especially for bigger vehicles

General Motors has reported a three month net loss of $15.5bn (£7.8bn) as North American sales fell by 20%.

GM took a $3.3bn charge for buying out the contracts of 19,000 hourly workers who left at the end of June.
 
It also wrote off $1.3bn because of reduced values of big, used cars, which cut the value of formerly leased cars owned by its financing unit, GMAC.
 
Without one-off charges, GM lost $6.3bn compared with a net profit of $891m in the same period of 2007.
It is the third biggest quarterly loss in the carmaker's history.
 
On 15 July, GM announced the latest stage of its restructuring plans, which include laying off thousands of workers, speeding up the closure of truck and sports utility vehicle (SUV) plants, selling assets and suspending its dividend.
 
GM is not the only company suffering from the state of the car market.
 
Other firms suffering
 
Earlier in the day, BMW warned that its profits for 2008 would be below forecasts and predicted a "difficult" 2009.
 
Also on Friday, Nissan reported a 42.8% fall in its three month profits.
 
Net profit fell to 52.80bn yen ($491m; £248m) between April and June, compared with 92.31bn in the same period of 2007.
 
"In the face of the severe operating environment, Nissan remains resilient but cautious on the outlook for our industry," said chief executive Carlos Ghosn, who also runs Nissan's French partner Renault.
 
Nissan said it was trying to limit the effects of the slowing US car market by raising prices, cutting jobs and reducing truck production.
 
 





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