North American largest carmaker, General Motors, Tuesday performed above Wall Street analysts’ expectations, with earnings of $33.6 billion, a pre-tax profit of 2.77 billion in the Q3, as against forecast earnings of $32.72 billion.
However, the automaker posted a loss of $2.98 billion on a net income basis, but that reflected $5.4 billion in unrealized tax assets and pension costs for the sale of its Opel and Vauxhall European brands to PSA Group.
GM shares have risen about 30 percent so far this year with investors responding to the news by driving the price up more than 4 percent in pre-market trading to $46.60 on Tuesday.
Also, the largest North American automaker earned $1.32 per share, while
Reuter’s analysts forecast $1.12 per share.
The carmaker reduced production at several plants to account for lower sales of some vehicles and changeovers to new products. GM had cautioned earlier in July that its profits might decline in the second half of 2017 as it cut production of slower selling cars and retooled several plants for production of new crossover and SUV models.
In a statement, Mary Barra, the chief executive officer said the company delivered solid results even with planned, lower third-quarter production in North America, adding that the company was being managed with discipline in order to drive strong performance today, while investing in higher-return opportunities, including those that will shape the future of transportation.
While, GM deliveries in China were up 12.3 percent over the third quarter of 2016, setting a record for the period, the carmaker’s automotive sales fell 16.6 percent in the quarter to $30.5 billion from $36.5 billion a year earlier. The slide in sales reflects GM recent decisions to leave several markets, including Europe, India and South Africa.
GM also has wound down production in Australia and ended completely in October. Majority of GM’s Q3 profit came in North America, where its U.S. sales recovered in August and September after falling in July.