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General Motors reported its second quarter earnings this morning, and the news was predictably grim. The General lost $15.5B in the quarter, as the Detroit Automaker continues to struggle with brutal market conditions and the costs associated with strikes and downsizing. Among the losses is a $4B hit from automotive operations, as stymied truck sales resulted in an 18% drop in revenue to $38B. GM's credit arm lost another $2.5B from high loan default rates and huge losses from truck and SUV lease residuals.

Another $9.1B came from one-time charges associated with GM's massive restructuring and the American Axle strike. Among the charges was a $3.3B write-down to pay for buyouts to the 19,000 UAW members that left by July. Overall, GM lost a staggering $27.33 per share in the quarter, which is even more amazing considering the General's stock is trading at about $10 per share. Among the actions GM took this week to help stem its bleeding balance sheet was ending all leasing in Canada, raising lease costs here in the States, and the announcement of 5,000 white-collar job cuts.

We're no industry analysts and we don't have any insights into the General's balance sheet, but a $15.5B Q2 loss and four straight quarters of red ink doesn't sound good at all. New fuel efficient products like the Chevy Cruze and Volt can't come soon enough, though it will be an even bigger challenge trying to make money off these small and ultra-fuel efficient cars.

[Source: Detroit News]

GM loses $15.5B in Q2 originally appeared on Autoblog on Fri, 01 Aug 2008 09:59:00 EST. Please see our terms for use of feeds.

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