Newspaper article International New York Times

G.M. Reports Strong Profit despite Costs for Recalls ; Sales in North America and China Rise, but Losses Grow in Europe Business

Newspaper article International New York Times

G.M. Reports Strong Profit despite Costs for Recalls ; Sales in North America and China Rise, but Losses Grow in Europe Business

Article excerpt

The nation's largest automaker nearly doubled its profit from a year ago, benefiting from wider margins in North America.

General Motors reported third-quarter earnings of $1.38 billion on Thursday, nearly doubling its $698 million profit from a year earlier as margins improved in its core North American operations.

For most of the year, G.M. has been grappling with about $4 billion in costs associated with safety recalls.

The performance exceeded analysts' expectations, despite special charges that included reducing the value of assets in the troubled Russian car market. The company appeared to benefit from improving sales of newer models in North America and China.

Mary T. Barra, G.M.'s chief executive, called the results "very solid," and said the company was succeeding even though instability was hurting overseas markets.

"Despite industry challenges in Russia and South America, our earnings were on plan as we continue to execute our customer- focused strategy," Ms. Barra said.

G.M., the largest automaker in the United States, reported revenue of $39.3 billion, up slightly from about $39 billion in the third quarter of 2013.

In North America, the company said it had pretax profit of $2.45 billion, compared with $2.19 billion in the same period a year earlier.

Results were mixed in international markets.

The company's chronic problems in Europe continued as its losses grew to $387 million from a $238 million loss a year earlier. It also posted a $32 million loss in South America, where it had a pretax profit of $284 million in the third quarter of 2013.

G.M.'s pretax profit fell to $259 million in its international division, which includes China, from $323 million in the period a year earlier.

G.M. could still face more costs related to the legal fallout from its recall of millions of small cars equipped with faulty ignition switches. …

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