GM makes a buck in Q4 2006
General Motors reported its delayed fourth quarter earnings today and, lo and behold, managed to earn a net income of $950 million in the waning months of 2006. Compare that with last year's Q4 loss of $6.6 billion, and today's news is all the more incredible. Again, those tricky one-time items skewed the results somewhat, since $770 million was earned in Q4 for the sale of GMAC, the automaker's financing unit. Still, without the one-time bump, GM managed to earn $180 million.
Cost cutting played a major role in GM's positive Q4 performance, as its vehicle lineup, at least in the U.S., is still a transitional mix of "old" and "new" GM product. Many highly anticipated new vehicles, like the Chevy Maliby, Camaro, and Cadillac CTS, have yet to go on sale. We expect the automaker's revenue from retail sales in the U.S. to keep climbing once the majority of its product portfolio has been turned over. GM also did well outside of the U.S., posting $228 million in earnings abroad compared with a $1.2 billion loss last year.
It seems clear, at least to us, that even if the GM turnaround hasn't officially turned the corner, it's got its blinker on and is just waiting for the light to turn green.
[Source: Automotive News]
Reader Comments (Page 1 of 2)
Clinton 1:05PM (3/14/2007)
That's great news, especially for the union leaders. It'll come in handy for them during contract negotiation time.
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Jason 5:23PM (3/14/2007)
I anticipate this new "Maliby."
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sze 1:17PM (3/14/2007)
#1 - Those union leaders shouldn't get quite so excited just yet. GM is by no means out of the woods, and the wage structure can never again be what it was, if GM is to remain a viable company.
The results this quarter are positive, but GM is going to need everybody, especially the unions, to stay on board as the turnaround continues.
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emor8t 1:55PM (3/14/2007)
What is this Chevy Maliby you speak of? Is this like when Apple accidentally posts info on the next gen iPoops? Mr. Neff is a GM Insider!
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YeeDiddy 1:39PM (3/14/2007)
What's a Chevy Maliby?
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DarkKnight67 1:45PM (3/14/2007)
New competition for the Toyota Camra. This is the start of a turn around, as long as the wrong people don't put their fingers into the pie.
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Bryan 1:55PM (3/14/2007)
Good news! Now it is Ford's turn.
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matt@thearticlewriter.com 2:28PM (3/14/2007)
The Maliby must be some sort of derivative of the Malibu. You know, kind of like how their was the Olds 98 and the Olds 88. Kidding!
Looks like brighter days are ahead for GM. Good news, indeed!
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Cuahetemoc 3:53PM (3/14/2007)
Sure. With all the tricky accounting practices, the writing off of debt, the taking of fiscal quarter charges, etc... I won't believe it. Sounds like a ploy for a temporary reprieve from demanding stockholders.
Union leaders? Are you serious? That's the problem with US manufacturers: paying $80,000+ to some GED holding schlep to grease an axel!
The unions destroyed US automakers, and continue to do so. That's why they go to Mexico... and even China!
The best part of the shrinking 2 falling apart is the eventual demise of the UAW.
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Jeremy 4:50PM (3/14/2007)
I'm impressed that GM is not looking at this as a "get out of jail free" card. They see that they made a profit and are excited, but at the same time they realize there is still a lot of work to be done. Go GM! Now, if only Ford could learn that the reason why the 500 isn't selling isn't the name, it's the fact that it's a BORING car. Then maybe they could make a come back.
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Lithous 3:19PM (3/14/2007)
"Congratulations on turning a profit General. Hopefully you're not using that new math that Bathous guy is always going about..."
Yes, Dick Expert, you are correct. That is America's new math. Toyota "creates" 2000 jobs while Ford sheds 10000 and we act like that is a bargain. Not my math, I'm just someone explaining the new math for those who don't see it.
These jobs, "created" and destroyed are directly connected, no question about that.
But I will concede to your near perfection in which you so obviously exude. I could never compete with someone who does everything at nearly a level 10. I am resigned to understand that I could never create a vehicle as good as most GM vehicles and that all the Terrell Owens in the automotive would could not do so either, so I give do respect. Nothing short of a crime, is it not? Not a hard concept to squirrel away.
Hopefully GM can make a profit for at least the next 166 quarters.
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Lithous 3:22PM (3/14/2007)
"automotive would" = "automotive world"
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A&W 3:22PM (3/14/2007)
Good job GM. Hopefully they can stay focused and avoid repeating past mistakes. I would like to see more good economy car choices from GM.
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Rastus 9:36PM (3/14/2007)
It's a shame the world's largest automaker still lost $2,000,000,000 last year.
When will this figure be published in their annual report to shareholders?
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??????????? 9:36PM (3/14/2007)
So, why did it take GM to "figure out" how much "profits"(right!) they made? Said they lost money last year, now suddenly, they "found" $$$?
OK.... maybe they all yanked their teeth at GM, and the Tooth Fairy gave 'em a few hundred million?
They can't even build a decent hybrid....
Aura 37MPG, It's Best! LOL.... I can buy a Optima I-4, 3-4 thousand less, that gets 34 MPG hwy, and no hybrid to worry about, no batteries to replace.
"10 years behind" is what Big 3 should be called( as in 10 years behind Toyota and Honda).
If all 3 Big 3 folded, I would not lose 1 second of sleep.
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Be Oh Be 9:52PM (3/14/2007)
Hey # 13
Learn how to spell "axle" correctly, you friggin' tool.
#16
You're an idiot.
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..... 10:58PM (3/14/2007)
Like one poster said, GM lost what, 2 Billion for all 12 months in 06? It's sad when GM has to tout 3 months out of the year as their big news. This is not a turn-around, yet.
When they MAKE $2 Billion per year profit, for 5 years in-a-row, then I will be impressed( well, they could match Toyota's 10-12 Billion in profits-per-year, and that would really be impressive).
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Rastus 11:13PM (3/14/2007)
2,000,000,000 / 365 = $5.47 MILLION DOLLARS each and EVERY DAY!!!
Everyone...EVERYONE!!!! BONUSES FOR ALL!!!!
JOB WELL DONE!!!
Is THIS what they call TOTAL QUALITY MANAGEMENT?!?!
...or is this all a part of the gay-bathous modern day mathematics?
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Jorkminn 12:55AM (3/15/2007)
Here's a good reason why I do not quite believe what GM has to say(profits, plug-in hybrids, whatever)....
http://www.thecarconnection.com/Auto_News/Commentary/Flint_GMs_Big_Plug-In_Talk.S192.A12067.html
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Creeper 1:18AM (3/15/2007)
I am a GM faithful, and while this news is too many, just added proof of GM's inadequacy compared to the “can do no wrong, Toyota,” it makes me pleased since it signals a light at the end of the despondent tunnel that has been GM of yore. General Motors got itself in this mess and it is a wonder at all that they have turned a profit (albeit a small one) for even one quarter of 2006. To have such goliath losses for the prior three quarters and manage to turn a profit in the forth is something of a miracle. While 2006 was mainly a giant corporate reorganization of funds and costs, 2007 and 08’ will truly begin to show a full spread of highly competitive products. At this course GM will not only start a turnaround, but can very likely regain its soon-defunct title as number one auto seller, even without fair trade, and full, equal, access to key markets like Japan that have greatly added to the volume of sales for certain other automakers looking to take the #1 spot. This is however just a start, and if the General hopes to truly regain market share and fight its ever looming public image problems it must not loose steam. I personally feel they will get the job done. With industry kingfish such as the beloved Bob Lutz high in the ranks, the ship is in good hands. The weeding out of former share holder Kirk Kerkorian was also a major plus seeing that his idea of a GM turn around was making the General into the next Diamler/Chrysler. “General Nissian,” didn’t sound right anyway. So, all in all General Motors will have to work twice as hard as its competitors to undo it’s repugnant past, thanks to trade issues, unions, and the former cheap image it has branded itself with. But judging from what I’ve seen so far, positive results are beginning to materialize in the form of quality products and corporate profits that are validating the companies’ efforts. I feel the great American General is up for the challenge, and as a result American cars may once again become something to brag about.
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