GM Sees Powerful Results in Second-Quarter 2010, with Large Gains in Sales Worldwide

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Researched by Industrial Info Resources (Sugar Land, Texas)--Automotive giant General Motors (GM) (Detroit, Michigan) reported strong results for the second quarter of 2010, as sales volumes dramatically improved for the North American and non-European international segments and costs steadily declined. Net income for the quarter was reported to be $1.33 billion, compared to a loss of $12.9 billion in the same period last year.

The company reported that net income earnings before income taxes and interest gains and expenses, or "EBIT," stood at $2.03 billion, demonstrating steady improvement from a first-quarter 2010 EBIT gain of $1.82 billion and a fourth-quarter 2009 EBIT loss of $4.05 billion.

Net sales and revenues from operations totaled $33.17 billion for the quarter, a 43.94% increase from second-quarter 2009. Total operating costs and expenses were reported to be $31.42 billion, a 3.29% decrease from the same period last year.

"The second quarter marks two consecutive quarters of profitability and cash flows, clear signs that we are making progress toward our goal of achieving financial health," said Chris Liddell, the chief financial officer of GM, in a conference call.

"In particular, we continue to deliver on all major business objectives," he later added. "We increased market share in all regions relative to the first quarter, we launched world-class vehicles such as the Cadillac CTS Coupe and the Buick Regal in the U.S. during the second quarter, as well as the Opel/Vauxhall in Europe and the Buick Excel in China. We're now selling more vehicles in the U.S. with four brands, than we were last year with eight, and with lower incentives. We're executing on a European restructuring plan, and we're making important strategic initiatives. And despite increased production volume, we continue to maintain our cost discipline."

Liddell also said that GM repaid $5.8 billion of its debt to taxpayers during the quarter.

GM's worldwide production volumes totaled 2.257 million units, a 46.75% increase from second-quarter 2009:

• GM North American (GMNA) production volumes were reported to be 731,000, an 85.06% increase from the same period last year:
• GMNA car production volumes stood at 279,000, a 64.12% increase.
• GMNA truck production volumes stood at 452,000, which is more than twice the production of 225,000 in second-quarter 2009.
• GM Europe (GME) production volumes were reported to be 331,000, a 5.08% increase from the same period last year.
• GM International Operations (GMIO) production volumes were reported to be 1.195 million, a 44.32% increase from second-quarter 2009.

GM worldwide sales volumes totaled 2.153 million vehicles, an 11.09% increase from second-quarter 2009:

• GMNA sales volumes were reported to be 716,000 vehicles, an 8.98% increase from the same period last year:
• U.S. sales volumes stood at 603,000 vehicles, a 11.46% increase:
• Chevrolet car sales volumes stood at 192,000 vehicles, a 29.73% increase.
• Chevrolet truck sales volumes stood at 252,000 vehicles, a 24.75% increase.
• Cadillac sales volumes stood at 35,000 vehicles, a 40% increase.
• Buick sales volumes stood at 38,000 vehicles, a 40.74% increase.
• GMC sales volumes stood at 83,000 vehicles, a 29.69% increase.
• All other sales volumes totaled 3,000 vehicles, compared to 76,000 in the same period last year.
• Canadian, Mexican and all other North American sales volumes stood at 113,000 vehicles, a 1.74% decrease.
• GME sales volumes stood at 442,000 vehicles, a 6.75% decrease from second-quarter 2009:
• Opel/Vauxhall sales volumes stood at 314,000 vehicles, a 9.77% decrease.
• Chevrolet sales volumes stood at 127,000 vehicles, an 8.55% increase.
• All other sales volumes totaled 1,000 vehicles, compared to 9,000 in second-quarter 2009.
• GMIO sales volumes were reported to be 995,000 vehicles, a 23.3% increase from the same period last year:
• Chevrolet sales volumes stood at 441,000 vehicles, a 27.09% increase.
• Buick sales volumes stood at 132,000 vehicles, a 15.79% increase.
• GM Daewoo sales volumes stood at 32,000 vehicles, a 14.29% increase.
• Holden sales volumes stood at 37,000 vehicles, a 23.33% increase.
• Wuling sales volumes stood at 303,000 vehicles, a 15.65% increase.
• Cadillac sales volumes stood at 5,000 vehicles, a 66.67% increase.
• All other sales volumes totaled 45,000 vehicles (including 22,000 for the FAW-GM model), compared to 23,000 in second-quarter 2009.

Liddell said that capital expenditures, which stood at $1.1 billion for the second quarter and $800 million in the first quarter, are expected to continue accelerate for the rest of the year, and are expected to total $5 billion to $5.5 billion for full-year 2010.

"I do expect our results to moderate for the second half of the year," Liddell said in the conference call. "I still expect this year overall to show solid profitability, reflecting how much progress we've achieved in a short period of time."

Industrial Info is tracking 24 active GM projects in the U.S. and Canada that are worth a total of more than $1.15 billion, including the $246 million expansion of the Allison Transmission Plant in White Marsh, Maryland. The project involves the construction of a 40,000-square-foot building to be added to the existing site, plus the installation of supporting equipment for the manufacturing of up to 40,000 electric motors. For more information, visit Industrial Info's North American Automotive Database.

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