GM beats quarterly profit estimates ahead of new-model wave

CEO’s Targets

The product push is part of Akerson’s efforts to boost North American profit margins to 10%, stem European losses and increase China sales to 5 million, all by mid-decade.

GM’s European unit, which includes the Opel brand, narrowed to an adjusted loss before earnings and taxes of $110 million from $394 million a year earlier. That was an improvement from the first quarter when the unit lost $175 million.

The company’s international operations, which include China, India and other markets, adjusted Ebit fell 64% to $228 million from $627 million a year earlier.

The results were weakened by sales declines in markets such as India and by Japanese automakers’ use of the weak yen to pressure GM in ASEAN and Australian markets, Ammann said. GM’s China Ebit rose from a year earlier, he said.

In South America, GM’s operating profit more than tripled to $54 million from $16 million a year earlier, the company said.

Year-earlier regional results were revised as part of GM’s previously announced financial reporting change implemented during the first quarter, said Tom Henderson, a company spokesman.

Total revenue rose to $39.1 billion, beating the $38.57 billion average estimate of six analysts.

GM’s Pickups

While GM’s lineup may be old, it’s still making some of the best vehicles it has produced in a generation along with Ford and Fiat SpA-controlled Chrysler, helping all three gain U.S. market share during the first half for the first time in 20 years.

GM’s second-quarter performance in its home market was bolstered by sales of its old pickups.

Combined deliveries of the Silverado and the Sierra, the GMC brand equivalent, rose 26%. The average transaction prices of GM’s full-size pickups rose 5.3% to $36,641 during the quarter compared with a year earlier, according to Edmunds.com, a website that tracks auto sales. That trails Ford’s F-150, which averaged $38,841.

GM’s pickup growth was in line with the gain posted by Ford’s F-Series, the market’s top-selling line of vehicles. The high-volume F-150 is due for a redesign next year.

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