Newspaper article THE JOURNAL RECORD

Mixed Auto Earnings Foreseen

Newspaper article THE JOURNAL RECORD

Mixed Auto Earnings Foreseen

Article excerpt

NEW YORK (Bloomberg) -- General Motors will post a third quarter loss because of recent strikes by the United Auto Workers, while earnings will rise at Ford and Chrysler on strong sales of high- profit trucks.

The 54-day strikes against GM at two Michigan parts plants, settled in late July, had ripple effects throughout the industry. A shortage of GM cars and trucks, for example, allowed all three companies to cut third quarter rebates to an average $1,300 a vehicle, down 23 percent from the second quarter.

The lower price discounts and continued cost-cutting helped profitability for all three companies. Still, Detroit automakers' earnings are increasingly threatened by economic problems that are damping demand in Latin America and Asia. Detroit-based automakers are expected to earn a combined $757 million in the third quarter, less than a third of the $2.63 billion in the year-ago period, said David Healy, a Burnham Securities analyst. …

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