Profit in North America slipped, but the automaker still beat estimates.
DETROIT – General Motors Co., after losing more than $18 billion in Europe since 1999, narrowed its first-quarter loss in the region, outpacing Ford and helping the automaker beat analysts’ earnings estimates.
GM’s European adjusted loss before interest and taxes was $175 million, compared with $294 million a year earlier, as the region’s economic slump continued to roil sales, according to a statement Thursday from the Detroit-based automaker. Companywide profit excluding one-time items was 67 cents a share, exceeding the 54-cent average of 16 estimates compiled by Bloomberg.
The results in Europe suggest that GM’s cost cuts are starting to offset declining industrywide sales, which are heading toward 20-year lows. The largest U.S. automaker in the fourth quarter took a $5.2 billion write-down of European assets to reflect the tougher conditions, forecasting that the reductions would boost 2013 results by $600 million.
“The year is off to a solid start as we increased our global share with strong new products that are attracting customers around the world,” Chief Executive Dan Akerson said in the statement. “We saw progress in Europe.”
Ford lost $462 million in Europe last quarter and in January widened the forecast for its full-year deficit in the region to about $2 billion. Before the revised forecast, Peter Nesvold, a Jefferies Group Inc. analyst, had said Ford would be about a year ahead of GM in revamping European operations.
GM’s first-quarter net income fell to $1.18 billion, from $1.32 billion a year earlier. Revenue was $36.9 billion, beating the $36.6 billion average of eight analysts’ estimates. Profit in North America before interest and taxes slipped to $1.41 billion from $1.64 billion a year earlier.