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MorganStanley analyst Adam Jonas said in an interview that it's too early to tell if International Operations will remain a trouble spot for GM. He doesn't think GM will soon repeat the $600 million profit from the region a year ago, but the $200 million from this quarter is too low. He expects profit to level off in the $400 million range.
The fact that problems flared up just as it appeared that GM was getting Europe under control isn't a long-term worry for a big international company, he said. "You're never going to get it all working together at the same time," he said.
In Europe, GM cut $284 million off its loss from last year, narrowing it to $110 million as cost cuts kicked in and new products such as the Opel Mokka small crossover SUV and Adam subcompact car sold well, Ammann told reporters.
Ammann said GM's year-over-year performance in Europe should improve as cost cuts and more new products take hold, but the second half might worsen due to a normal seasonal slowdown.
"The things that we control we feel very good about," Ammann said. "Obviously what we don't control is the European macro environment. That remains very challenging, but we're making good progress despite that."
GM has said it expects to break even in Europe by the middle of the decade. Ammann wouldn't provide further guidance.
Overall, GM's revenue rose 4 percent to just over $39 billion, beating Wall Street's estimate of $37.7 billion. Worldwide sales rose 4 percent to 2.49 million vehicles.
GM's earnings come a day after its closest U.S. competitor, Ford Motor Co., reported better-than-expected profits, especially in Asia. Ford earned $1.23 billion, up 18.5 percent from a year ago.