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GM lost $400 million in Europe since bankruptcy exit

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GM lost $400 million in Europe since bankruptcy exit




NOVEMBER 16, 2009 11:34 CET

DETROIT -- General Motors Co.'s European operations have lost more than $400 million since GM emerged from bankruptcy in July, CEO Fritz Henderson said Monday.

Henderson's comments came as the U.S. carmaker announced a $1.15 billion loss during the third quarter following its exit from bankruptcy and said reduced costs and stabilizing sales would allow it to begin repaying $6.7 billion in U.S. loans.

"We have significantly more work to do, but today's results provide evidence of the solid foundation we're building for the new GM," Henderson said.

The "managerial net loss" was for the period from July 10, the day GM exited court protection, through Sept. 30. For the full quarter a year earlier, the automaker had an operating loss of $4.2 billion and a net loss of $2.5 billion.

Henderson also said GM will meeting with European labor unions in the coming weeks to finalize plans for its Opel/Vauxhall unit for 2010.

GM also said:

• Revenue for the entire three-month period rose to $28 billion, up $4.9 billion from the second quarter. GM attributed much of that increase to a global seasonally adjusted annual sales rate of 67.8 million units in the quarter, up from 62.7 million in the second quarter.

• It will burn through additional cash in the fourth quarter. GM will pay out $2.8 billion for Delphi's bankruptcy settlement, $2 billion for "payment term adjustments," $2.5 billion for loan repayment to the U.S., Canadian and German governments and $1 billion in restructuring costs. Cash levels will be "materially lower than third-quarter levels of $42.6 billion."

• The U.S. total-vehicle sales rate will be 10.7 million units in the last three months of this year. GM said demand averaged 11. 7 million units in the third quarter, buoyed by the government's cash-for-clunkers program. Light-vehicle sales rates are typically 200,000 to 300,000 units less than total-vehicle rates.

• Fourth-quarter global demand will slip to a 65.4-million-unit rate.

• In 2010, global sales will total between 62 million and 65 million units. In the U.S., total-


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