GM makes multi-billion dollar profits in North America but loses in Europe

Car maker General Motors ( GM ) reported record profits for 2011 yesterday ( February 16 ). After completing its first year as a publicly traded company, net profit for the global car manufacturer stood at USD 7.6 billion, well up from the USD 4.7 billion net profit in 2010. But the news in Europe was not so good, where the automotive leviathan continued to post big losses.“In our first full year as a public company, we grew the top and bottom lines, advanced our global market share and made strategic investments in our brands around the world,” said GM chairman and CEO Dan Akerson. GM produces cars under brands like Chevrolet, Buick, Cadillac and GMC.

As well as seeing losses in Europe, GM was in the red in South America. Its Earnings Before Interest and Tax (EBIT ) adjusted losses in Europe were USD 700 million for 2011. The biggest losses occurred in the fourth quarter, USD 600 million, but this included USD 200 million in restructuring costs. The overall result for Europe represented a USD 1.3 billion improvement on 2010, when European losses amounted to USD 2 billion. In South America losses were USD 100 million, again an improvement on 2010, when GM was down USD 800 million for the region. The two remaining regions – GM North America and GM international operations – both recorded profits, but with the lion's share coming from North America, where EBIT adjusted profits for 2011 were USD 7.2 billion. GM international posted pre-tax profits of USD 1.9 billion for 2011, which represented a fall back from 2010 when profits reached USD 2.3 billion. Full year global pre-tax profits stood at USD 8.3 billion. “We will build on these results as we bring more new cars, crossovers and trucks to market, and make GM a far more efficient global team. This includes reducing our break-even level in Europe and South America and driving higher revenues around the world,” said CEO Dan Akerson. Liam Lever, liam@romania-insider.com (photo source: GM)