GM profit misses estimates; losses in Europe deepen

Thu Feb 14, 2013 9:40am EST
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By Ben Klayman and Deepa Seetharaman

DETROIT (Reuters) - General Motors Co (GM.N: Quote) reported a weaker-than-expected fourth-quarter profit on Thursday, citing wider losses in Europe and lower vehicle prices in its core North American market.

The largest U.S. automaker also took an accounting change in the quarter intended to signal confidence that it will continue to be profitable in coming years.

GM posted a profit of 48 cents per share before one-time items, 3 cents shy of what analysts polled by Thomson Reuters I/B/E/S had expected.

Losses in Europe totaled $699 million in the quarter and $1.8 billion for all of 2012, more than doubling from 2011, reflecting the rapid deterioration of vehicle demand and economic conditions in the region. It was the 13th straight year of losses in Europe.

Chief Financial Officer Dan Ammann said GM still sees industry sales in Europe declining in 2013 and is "not betting on" a pickup later in the year.

During the fourth quarter, prices also fell in North America, GM's most profitable region, as the company offered incentives to cut through its inventory of trucks on dealer lots.

"The (decline in price) is essentially setting up to work through some of the inventory of some of the products that are getting replaced in the marketplace," Ammann told reporters.

Last year was GM's second full year as a public company since its initial public offering in the autumn of 2010, which followed the bankruptcy restructuring and $50 billion U.S.-taxpayer bailout of the prior year.   Continued...

The General Motors logo is seen outside its headquarters at the Renaissance Center in Detroit, Michigan in this file photograph taken August 25, 2009. REUTERS/Jeff Kowalsky/Files