General Motors Records Quarterly Net Loss
The No. 1 U.S. automaker posted lower revenue for the quarter as it shuttered plants North America to reduce production and tackle bloated inventory levels.
The GM logo. (Photo: Reuters)
General Motors Co posted a quarterly net loss on Tuesday due to charges stemming from the sale of its Opel unit in Europe to France's Peugeot SA, but excluding charges its results handily beat analyst expectations and the company reaffirmed its full-year earnings outlook.
The results sent the company's shares up more than 2 percent in pre-market trading.
The No. 1 U.S. automaker posted lower revenue for the quarter as it shuttered plants North America to reduce production and tackle bloated inventory levels, especially of unpopular sedan models as consumers move increasingly to pickup trucks, SUVs and crossovers.
GM had 76 days' supply of unsold vehicles at the end of September, down from 88 days a month earlier and over 100 in the summer. The company's wholesale volumes were down 26 percent versus the same quarter in 2016.
GM said on Tuesday it was on track to meet its goal of 70 days' supply of vehicles in United States by the end of the year.
But as GM has embarked on a months-long process to trim excess supply, it relied heavily on consumer discounts to sell vehicles. Discounts as a percentage of the average transaction price totaled 13.7 percent, slightly above the industry average.
Anything over 10 percent is considered unhealthy for vehicle resale values and unhealthy for automakers in the long term.
The company said that all of its units were profitable for the first time since the fourth quarter of 2014.
Detroit-based GM posted a third-quarter net loss of $2.98 billion, or $2.03 per share, compared with a profit of $2.77 billion, or $1.71 per share a year earlier. Excluding discontinued operations, GM posted a net profit of 8 cents per share.
Excluding one-time charges, the company earned $1.32 a share, above analyst expectations of $1.14.
In pre-market trading, GM shares were up 2.8 percent at $46.41.
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