GM Q4 loss plunges to $722m
Detroit, February 12, 2008
General Motors said on Tuesday it would offer a new round of buyouts to all of its US hourly union workers as it posted a $722 million quarterly loss that underscored the pressure the top US automaker faces in its slumping home market.
GM said its fourth-quarter loss reflected lower US production, more aggressive discounting on its recently launched full-size pickup trucks and weaker results in Germany, traditionally its most profitable market in Europe.
Some analysts were encouraged that the sweeping deal with the United Auto Workers covering 74,000 factory workers could allow GM to cut labor costs more aggressively than expected.
But GM's results, others said, also pointed to continued risks for the automaker's turnaround, particularly in the US market, which has been hurt by a slower economy, higher fuel costs and tighter credit conditions.
For the fourth-quarter, GM swung to a net loss of $722 million, or $1.28 per share, compared with net income of $950 million, or $1.68 per share, a year earlier.
Shares in GM, which have gained 11 percent since the start of the year, were up 1.1 per cent in midday trading on the New York Stock Exchange.
For the year, GM said it expects to post improved global automotive results driven by gains in emerging markets, but declined to offer a more specific forecast for the crucial and troubled U.S. market, still its largest by revenue.-Reuters