General Motors, the world's largest automaker, reported a 54 per cent drop in third-quarter earnings before charges today, reflecting the sharp fall in US vehicle sales and the costs of cheap loans to customers.
GM said its quarterly earnings, excluding a charge of $753 million, fell to $385 million, or 85 cents per share, from $829 million, or $1.55 per share, a year earlier.
GM reaffirmed its third-quarter earnings forecast of 83 cents per share on September 17th, just days after the hijacked plane attacks on New York and Washington disrupted the US economy.
The results beat Wall Street forecasts of 80 cents per share, with a range of 55 to 86 cents, according to research firm Thomson Financial/First Call.
Detroit-based GM blamed the weaker earnings partly on a 6.2 per cent third-quarter cut in new vehicle production in its key North American market. Rather than trim production further after the September 11th attacks, the automaker added broad customer incentives to keep sales moving.
Shares of GM closed yesterday at $42.77 on the New York Stock Exchange. GM shares have outperformed their closest rival, Ford Motor, by around 15 per cent since the beginning of the year.