Written by: Sandy Williams
General Motors nearly doubled its fourth quarter earnings while posting big losses in Europe.
GM reported fourth quarter earnings of $898 million, up from $468 million in the same period in 2012 due in part to a variety of gains from special items. A number of one-time accounting gains and losses accounted for a $100 million increase.
Net income for 2012 was $4.9 billion, down 36 percent from $7.6 billion in 2011 but its third consecutive year of profit.
North American sales provided GM its quarter profit, offsetting European losses. GMNA sales were up slightly in fourth quarter to 735,000 from 712,000 at the end of 2011. Annual sales for 2012 were 3,019,000, up from 2,925,000 in 2011. U.S. sales for fourth quarter were 628,000, up from 602,000. GM sold 2,596,000 vehicles in the U.S. in 2012—an increase of 92,000. GMNA reported EBIT of $1.4 billion in the fourth quarter.
European losses were worse than expected, widening to $699 million pre-tax in the fourth quarter from $572 million in 2011. Overall, GM lost 1.8 billion in its European sector in 2012, more than double its 2011 losses. GM does not expect improvement in Europe for 2013 and said it hopes to break even in Europe by mid-decade. In the meantime, it is restructuring its Europe assets, including plans to close one plant, and introducing 23 vehicles over the next years.
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