Business

GM profit down but better than expected

GM logo and car Image copyright Bill Pugliano/Getty

General Motors has reported a drop in profits for the three months to June, due to lower vehicle sales and restructuring charges.

The car giant saw net income fall to $2.4bn (£1.8bn), down from $2.8bn a year earlier. Revenue fell 1% to $37bn.

However, the results were still better than Wall Street analysts had expected.

Exceptional items included $100m to write off the firm's Venezuela operation, which was seized by the government there in April.

The results for the quarter excluded the company's European operations, which are being sold to France's PSA Group.

GM's shares rose 2.5% in trading ahead of the official opening of the New York stock market on hopes that north America's biggest carmaker is coping with a fall in US car sales.

The big carmakers have reported declining sales for the past four months in a row.

GM has built up a large inventory of unsold vehicles in advance of the launch of new models.

The company said on Tuesday that dealer inventories in the second quarter were up 273,000 against the same period in 2016.

GM plans to cut North American production by 150,000 vehicles in the second half of 2017 compared to the first half.

The carmaker notched up higher sales in China compared with the quarter a year ago, but its overall international sales fell from the 2016 period.

Nevertheless, chief executive Mary Barra said the results were positive news for the carmaker. "Disciplined and relentless focus on improving our business performance led to a strong quarter and [a] very solid first-half of the year," she said.

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