GM posts US$15.5bn loss

Source: Manufacturing Digital

Date :01/08/2008 09:30:08

The collapse in the North American auto market has hit GM hard in the second quarter as its losses widened to a worrying US$15.5 billion.

Back in mid-July, the company warned that it would post "a significant second quarter loss”, but the figures were far worse than most analysts had predicted.

The loss of US$27.33 per share is the third-worst quarterly loss in its history. In the same period a year earlier, GM recorded a net profit of US$891 million, or US$1.56 per share.

The company said the results were primarily driven by several factors: significant losses in GM North America (GMNA) due to continuing US industry volume declines, the long strike at American Axle, a number of special charges associated with ongoing restructuring actions and continued losses at its financial services division.

"We are reacting rapidly to the challenges facing the US economy and auto market, and we continue to take the aggressive steps necessary to transform our US operations," said chairman and chief executive Rick Wagoner in a statement.

However, with few predicting an immediate rise in market, the next few months could be set to be most challenging in the automaker’s history.