GM 3Q profit nearly doubles, led by N. America
DETROIT (AP) — Big profits from rising SUV and truck sales in North America helped General Motors nearly double its third-quarter net profit and more than offset its struggles in Europe and South America.
The automaker posted net income of $1.38 billion, or 81 cents per share, from July through September. A year ago, GM made $698 million, or 45 cents per share.
It was the first quarter this year without significant charges for recalls. GM has issued 75 recalls in 2014 covering more than 30 million vehicles, costing the company more than $2.8 billion.
Without $331 million in one-time items, GM would have made 97 cents per share, exceeding Wall Street's expectations. Analysts polled by FactSet expected 95 cents.
Revenue grew 2 percent to $39.25 billion. That also beat expectations of $38.79 billion. GM shares rose more than 1 percent in premarket trading.
In North America, revamped pickup trucks and SUVs helped to push GM's pretax profit up 12.1 percent to just over $2.4 billion. The company's profit margin — the amount of revenue it gets to keep — hit 9.5 percent, the fifth-straight quarter of growth. In China, pretax profit rose 14 percent to $484 million.
GM's North American wholesale vehicle sales rose about 60,000 over last year, and half the increase came from pickup trucks and SUVs with high sales prices, said Chief Financial Officer Chuck Stevens.
"The new trucks and SUVs are more profitable than the ones they replaced. That certainly helps from a profit perspective," he said.
GM sold 884,000 vehicles in North America during the quarter, an increase of 9.4 percent.
But the company's loss in Europe, including Russia, grew 63 percent to $387 million. GM also lost $32 million in South America. But Stevens said both regions improved from previous quarters as cost cuts took hold.