G.M. Says Weakness in Asia Leads to Drop in Profit

G.M. said it earned $1.2 billion in the quarter, compared with $1.49 billion in the same period a year ago, although it narrowed its losses considerably in Europe, where weak economic conditions have driven new-car sales to their lowest levels since the 1990s.

The company said that its global revenue was up 4 percent to $39 billion, and that worldwide vehicle sales, including joint ventures, increased 4 percent to 2.49 million.

In North America, G.M. benefited from new products and a steadily improving market for new cars and trucks.

The company said it earned $1.97 billion in pretax income in the region during the quarter, a 4 percent gain from $1.89 billion a year ago.

G.M. said it had a pretax lost of $110 million in Europe, compared with a loss of $394 million in the same period in 2012.

Its performance in Asia declined, however. General Motors said that it earned a pretax profit of $228 million in the region, a 63 percent decrease from $627 million a year ago.

South American results improved to a $54 million pretax profit, compared to $16 million a year ago.

G.M.’s chief executive, Daniel F. Akerson, said the automaker is making progress in Europe, where it has lost money for more than a decade. The company has revamped its European management team with outside hires and stepped up new products in the region.

The company is also trying to increase the presence of its two best-known American brands, Chevrolet and Cadillac, in other parts of the world.

“We continue to perform well in the two most important markets, the U.S. and China,” Mr. Akerson said in a statement. “We also made progress in our European business and saw the steady performance of our global brands, Chevrolet and Cadillac.”

While G.M. continued to grow in China, it faced increased competition and pricing pressure from Japanese automakers in other Asian markets as well as Australia.

G.M. said its market share in North America dropped slightly to 17.3 percent, down from 17.4 percent last year.

Its global market share also slipped to 11.5 percent, compared to 11.6 percent in the second quarter of 2012.

The company increased vehicle sales in every region other than Europe, where sales fell about 7 percent during the quarter.

Article source: http://www.nytimes.com/2013/07/26/business/gm-says-weakness-in-asia-leads-to-drop-in-profit.html?partner=rss&emc=rss