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Stan Honda / AFP - Getty Images
Things are looking up ... mostly. The General Motors headquarters January 10, 2012 in Detroit, Michigan.
Updated at 12:20 p.m. ET
General Motors posted flat fourth-quarter income Thursday but still managed to haul in $7.6 billion worth in profits last year, up 62 percent from the prior year.
It was the highest annual profit ever for the automaker, which emerged from bankruptcy protection in 2009 after a government-led bailout.
The U.S. government still owns 26.5 percent of the company and is waiting for the share price to rise before selling in an effort to recoup the bailout money. GM stock was up 6 percent at $26.43 in midday trading after the earnings announcement.
"We will build on these results as we bring more new cars, crossovers and trucks to market," CEO Daniel Akerson said in a statement.
Full-year revenue rose 11 percent to $105 billion.
North America led the way with a $7.2 billion pretax profit. But problems surfaced that could hurt future earnings. GM lost $700 million before taxes in Europe, and lost $100 million in South America.
"We obviously have work to do still and a long way to get to the objectives we ultimately want to get to," GM Chief Financial Officer Dan Ammann told reporters.
"We clearly have work to do in Europe. We have work to do in the South America business. Frankly, we have work to do all around the company in terms of cost opportunity," he added.
GM'S fourth-quarter profit was flat with 2010. GM earned $500 million, or 28 cents per share. Revenue rose 3 percent to $38 billion. Before one-time items, GM earned 40 cents per share. Analysts expected earnings of 42 cents on revenue of $37.9 billion.
Ammann said GM has not gone far enough in cutting costs in its European operations, but declined to provide a 2012 financial forecast for a unit that the No. 1 U.S. automaker has struggled to return to profitability. Overall, GM expects 2012 sales to top the $150.3 billion it saw in 2011 and its market share to remain flat.
Vote: Do you think the US bailout of GM was wise?
Last year, GM made the bulk of its income in North America, where its pretax profit totaled $7.2 billion. International Operations, which includes Asia, made $1.9 billion before taxes, but that was down.
During the year, GM's global sales rose 7.6 percent to 9.03 million vehicles to help it reclaim the title of world's largest automaker from Toyota Motor Corp.
This year, GM expects to increase its revenue as global auto sales grow and it charges more for models. However, it will make less money per vehicle as the mix of sales continues to shift to cars from trucks, which have bigger sticker prices. It also expects to invest $8 billion on new products and technology, and says pension expenses will rise. The company wants to keep expenses down by freezing its underfunded U.S. pension plan for salaried workers.
GM said 47,500 blue-collar workers in the U.S. will get $7,000 profit-sharing checks in March. The checks are based on North American performance and are a record for the company.
The company has placed Vice Chairman Steve Girsky in charge of the European management board and is adding executives in preparation for restructuring. Factory closures and layoffs are likely but could provoke a fight with powerful labor unions.
Girsky has said GM intends to fix the European unit, made up of the Opel and Vauxhall brands, and keep it in the company. GM came close to selling the unit in 2009.
Related stories:
Return of third shift brings hope to auto workers
GM ending pensions for white-collar workers
The Associated Press and Reuters contributed to this report.
Overall through the entire year the company has made progress but there is more work to do in Europe and South America, says Daniel Ammann, General Motors CFO, who adds, "The company has more work to do all across the company to get to the efficiency w...
How can GM celebrate? Take away worker's pensions in the finest traditions of corporate America. GM a leader in the race to the bottom.
$7,000 per employees bonus.
The long suffering taxpayers stands there downcast, holding his 25.4 billion dollars worth of GM stock, that sells for $27.00 a share and needs to be at $55.00 a share for the taxpayer to break even, no interest.
Then they look wistfully at the 17 billion that, the financial arm of GM, Ally, owes them.
We would have been much better off financially, to have had Mr Obama simply hand each member of the UAW $100, 000 dollars and allowed the bankruptcy to proceed in accordance with the law, instead of perverting the law to hand 10% of GM to the UAW
GM is not the major story. If not for government intervention, thousands of suppliers to the auto industry could have collapsed and shuttered their doors. President McCain would have had to make the same decisions to fix what the previous administration could not. Leadership is the story here.
"Osama is dead, GM is alive and well," I heard that yesterday...
The presidents team should point out all the good this president has done inside four years...
No Irish, the bankruptcy happened anyway so the supplier issue is a crap excuse. The only difference is under obama the stock and bondholders along with the taxpayers, got screwed. It was a big win for the unions...that all it was about.
Back when GM management ran the Company the way they wanted all emphasis was on Large SUV's and Pickups. SUV's had a profit margin of $15k per vehicle. and when gas prices dictated the decline of it they doubled down and pushed em even harder. All while eschewing high mileage vehicles. So to save the jobs of American workers, The Feds took over the company, strengthened the CAFE stds making high mileage cars important. Workers gave up a lot, but they are still well paid compared to the rest of the US workforce (except Fed employees) but their jobs were saved. So now the Company posts a major profit and no doubt the managers are taking credit for making it happen. When this sort of thing happened in the past usaully a huge bonus round goes to management and a few years later the employees are told the place is broke again and need to make more concessions. The merry-go-round keeps turning.
Democrats are all about fairness. However not when it comes to competition within the autos. Ford chose to NOT get bailed out and instead reach out to the private sector and get financing to keep going. Today they pay interest on those loans. GM doesn't have those same interest payments. They gave the taxpayers stock instead which has continued to decline no matter how much hype the media and Obama push about how successful this story is. On top of that GM was allowed to write off 45 billion of prior losses into these numbers which other companies emerging out of bankruptcy are not allowed to do.
But the real story is that GM makes money on the big gas guzzlers not the small, economic ones. They have a fixed cost of $58/employee compared to KIA that has a fixed cost of $40/employee. The KIA dealer here in my town has expanded several times while GM has shuttered many locations. So looking forward once all these special advantages are gone, GM will not be competitive with their other competitors.
The government should not be the in the business of bailing out companies and giving unfair advantages to those companies compared to their competitors that did the right thing. What sort of message is this? It is called moral hazard and we have seen plenty of this for some time here in the US.
What was really nasty of the government was the treatment of their bondholders. Who are those bondholders? Ever read about who they were? You know...school teachers that invested in GM never thinking they would be left with pennies. Bond holders are not always rich fatcats.
Terry-ca
yes!
GM is alive and all it cost us was a few billion dollars!!!
good job Lamebama!!
lets not be fooled Terry,
they took 2 loans and paid back 1 of them!!!!
SOOOOO... with all this profit and extra money laying around, how about GM donate some BACK to the government!!!
http://www.foxnews.com/politics/2010/04/22/grassley-slams-gm-administration-loans-repaid-bailout-money/
and from a michigan paper
http://michiganmessenger.com/37170/gm-paid-back-government-loan-with-government-money
and from florida
http://www.politifact.com/truth-o-meter/statements/2010/apr/27/ed-whitacre/ceo-says-gm-has-repaid-government-loans-full/
so i took a fox news line, a michigan news line, and a florida news line just to show you its not FAUX news made up.
so they got 1 loan for 57 billion and another for 6 billion, and paid back the 6 billion, where is the other 57 billion?
probably with the great job he did with SOLYNDRIA!!!!
http://www.washingtonpost.com/politics/campaigns/republican-groups-trying-to-use-bankrupt-solar-energy-manufacturer-solyndra-against-obama/2012/02/14/gIQAeklAER_story.html
yes indeed Lamebama, good job!!!
Solyndra was only 500 million in loss!
so terry,
abouot that "good job" he has done.
where is it?
Ok so now is the time for government moters (GM) to pay back the taxpayer for ALL the money it took plus interest just like the banks did.
Not quite. The banks may have paid back TARP but not the billions that were funneled to them though AIG as "insurance" on their gambling debts. Lets not forget the money they made off of the essentially no interest loans from the Fed. TARP was only a small part of how the banks looted the taxpayers with the assistance of the Fed and politicians from both parties.
Hey Common Man, actually do some research before you spew your uneducation all over the internet.
Can't have to pay bonuses to the UAW
I agree.........nice story.........NOW GIVE US BACK OUR MONEY!!!!!!!!!!!!!
A question: Janus and JKLKC and common man, do any of you own a Volkswagen, Porsche or Nissan?
If you do here are a couple of facts:
The state of Lower Saxony (Germany) owns 20% of Volkswagen
In 1999, Nissan entered a two way alliance with Renault S.A. of France, which owns 43.4% of Nissan while Nissan holds 15% of Renault shares, as of 2008. The government of France owns 15.7 per cent of Renault.
The US government will eventually divest itself of all ownership of GM. The Government of France and the State of Lower Saxony will not divest themselves of Renault or Volkswagen.
If you do some research you will find that every automobile producing country supports its auto industry either directly or indirectly (read up on MITI in Japan). Ever wonder why nearly 100% of all the care in South Korea is made there?
In short the bailouts worked.
darn all those employees with a bonus check coming there way, when we could of had them all on welfare, sitting at home collecting food stamps. What nerve.
Jeff when some of us actually lose a job we go find or make another...I don't beleive 1 penny in bonuses should be paid until every cent borrowed including money to GMAC financing is paid back.
$42 billion dollars GM owes the tax payers, we could have paid a lot of UE, welfare and food stamps, for that amount, no one believes you anymore, JEFF, we can do simple math
Except that if it gets spent on welfare and food stamps, you all stamp your little feet and say that's not fair - those lazy people that won't get jobs can't have your tax money.
Incidentally, while I won't pretend I know how much, I do know that GM has paid a lot of that taxpayer money back.
Yes Nina, with bogus Volt contracts. Do you know how many GM Volts the government has committed to buy with your tax dollars? The final price for those junker continues rises, last price I saw was $38k and expected to top $40k. GM has payed nothing back WE ARE.
Nina..NO THEY HAVE NOT!
Nobody is talking about letting GM go all the way under at all. Many of us are saying they needed to go through the court system just like any other business that files bankruptcy without government interference. The court would have treated the bondholders better, they would have brought union costs in line with future competition and they would have removed all management and perks.
I do think it is morally depraved to pay bonus money when large sums are still owed those on the hook for their very existence.
Seriously, how does GM pay back the taxpayer? The stock has done nothing but plummet since the IPO even though the market has been going the other way. On top of that some of their competition was out of the way due to weather related events. The future does not look rosy because their cost structure isn't low enough to jump these competitive hurdles.
Wow if I could flush my debts, get tons of money from the government, and have the government give incentives to buy my failed electric car, I would probably make record profir also.
Proof positive of our current sad state of affairs, that if you think like the Fed and run a business into the ground like GM = "success". I hope it doesn't catch on.
What's good for business is good for America, right? So rooting against business, as you are doing, is rooting against America.
Matt, no one is rooting against America....but thanks for providing a prime example of our failing educational system.
where is my profit sharing check for using my tax dollars.....LOL....
I'm sure all the elderly GM retiree's who had their pensions and health care plans ripped away from them and forced to FORGET their dreams they WORKED decades for would just be so glad to hear this news.
So many of them lost everything they had because they no longer could pay property tax es they lost life long homes. They lose their lifelong doctors because Medicare is all they get now.
I do not care if GM was the last car maker on the planet I will NEVER buy another thing from GM. I'll get all that walking done my Dr says I need to do.
GM the robbers of thousands of elderly dreams.
Yes roughly half of the uSA would not buy a GM product or GM stock under any circumstances.
When GM pays back all the money they took plus interest I would consider buying a GM car again.
But did they pay back the billions in government loans? At one time the said the had but then it came out not so much, they lied! Yesterday I read an article G.M.'s pensions were under funded by 10.5 billion and the white collar workers were going to lose their pensions. So W.T.F.?
GM is now the post office. If they can't make a profit, we tax payers will foot the bill.
Lessons from obama...if the numbers don't work, just make up new ones.
I was and still am against the bailout - if GM wanted to stay in business they needed to make tough decisions, not get money from us. Never will I buy a GM car. Unions get their bonuses, get to opt out of Obamacare - while retirees and investors lost their investments. Don't think we have equality in the U.S. anymore - scary times ahead.
Just tell me, when "we" had equality in the USA ??? (I must have been sick on that day.)
Well Pete, it was a little more equal before the company, with the help of the president, stole the stockholders and bondholders investment and turned it over to the union.
My questions is and I don't know the answer to this is. How much did GM pay in taxes in 2011? Plus how much has GM pay in taxes over all of the decades.
Yes GM needed a bail out. But if they are paying Federal taxes then what is the net affect on the deficit. Would letting GM go bankrupt add or decrease the deficit. Does any know the answer.
Does any does any research. Does anyone think for themselves anymore instead of listening to sound bits that fit you preconcieved prejudices.
Without the tax dollars pouring in, it would add to the deficit!
We basically paid 82 billion to bailout the UAW that contributed $5 million to Obama's campaign.
The to run salt into the wound, GM was allowed to talke and additional 6.5 billion from the bali out money, hand it back to the government and call the loan "paid"
Someone needs to be prosecuted on that shennanigan.
Okay so now all we have is the 25.4 billion dollar stock, the taxp payer owns.
The would require the stock to sell for $55.00 a share in order for the taxpayers to get their money back.
The current price is about $27.00 a share, the stock would have to double in price for us to break even
no interest.
The financial arm of GM ALLY, owes the taxpayers another 17 billion.
Currently we have 30 billion dollars out that we have no security for.
Financiially, we would have been well ahead to have just, handed $ 100, 000 to every member of the UAW and allowed the bankruptcy to proceed in accordance with the law instead of the perversion, of the law, that Obama arranged.
Everyone concerned with that will go in front of a Grand Jury as soon as Mr Obama leaves office.
GM was allowed to keep their tax loss carry forward through bankruptcy, they pay no tax until it's eaten up. The only company in US history allowed to do so.
It's not a question of a "bailout," it's why GM had to in the first place. The company and its assets were stolen from existing shareholders and bondholders. GM needed a bridge loan, that was it.
Instead the company was stolen by a corrupt government and given to the UAW.
What? Each union employee gets a $7000 check? What will the retards say now? They sure as hell are NOT looking out for our welfare! Thank you Mr. Obama for the nice thing you did for all those many thousands of still employed persons. GM paid back the loan. Now, if only the crooks in the big banks would pay me back all the money they stole, everyone in this country would be happy! Get over yourself, get down off your high horse you dumbass republitards. Your party is the one that always has to bring the U.S. down to poverty levels, WHY??? WHY do the Democrats always have to fix your idiotic messes???? WHY, WHY, WHY??????
D from Dpencer
The retards would probably said they could have paid that money on the 42 billion they owe the taxpayers.
Does anyone really believe this malarkey?
Hope against hope but is there any hope that the taxpayers will ever recoup their investment in Government Motors?
Do people realize that bailing out the automakers was BUSH'S IDEA and BUSH'S PLAN??? Obama just continued the program because it was the right thing to do for the economy. Nobody wanted another 4M+ enemployed--except for maybe the Republicans because they would have more hostages for keeping the bush tax cuts for the wealthy and corporate loopholes!
We would have been money ahead to just handed $100, 000 to each member of the UAW
Divide 42billion by $100, 000 .
Possibly we need to conduct basic math classes for the democrats.
Some things are more important then money. In fact most things are.
GM may be needing more welfare, watch out for even more bailouts by this administration for a company that still owes $25.4 billion. Whatever profits they may have made is far overshadowed by their debt as they struggle to stay above water.
www.freep.com/article/20120127/BUSINESS07/201270346/Bailout...
Good for GM. Another Obama success story too. Instead of thousands and thousand of more unemployed, there's a thriving auto industry, and that includes all the parts manufactures, and subsidiary businesses that depend on the industry too. Not to mention its a classic vehicle brand. How can America not have a Chevy, it would be sacrilege. And it looks good on the Repubs who would have sold GM down the river, because they care about workers last, the economy last, and would have used the situation to take out another union. Because they more or less want to destroy America.
If you look at everything they have done the last 40 years, how can you have any other conclusion. Look at their posts above already, all complaining because GM is a success and all those jobs were saved. Using whatever they can to nitpick and call the company down. All along telling people not to buy GM.. For no other reason than because Obama gets the credit, and they want America to fail. They hate this America. Pathetic doesnt even come close. Anyone that votes for the right must Hate America and want it to fail. They must want the middle class destroyed. If I didnt know better I would say the right are still trying to fight the civil war.
Do America a favor, do yourself a favor, vote out ever last repub in the country, and America will rebound so fast it will make your head spin, and the Repubs heads explode.
Uhhuh, The Uaw, GM, still owes the American taxpayer 42billion, we could have paid unemployment until the year2100.
The ongoing cry of democrats that, republicans want America to fail so that Obama won't get credit, simply demonstrates the lack of facts that the democrats have to work with.
Barack Obama is so inept that no effort is necessary, to make him look bad.
Divide $42 billion by the number UAW workers and you will see we would have been a lot of money ahead to have simply handed $100, 000, to each member of the UAW.
You supporters of Mr Obama really need to look around and find some basic math classes.
Obama and his crony capitalism. Screw the taxpayer to funnel millions to his cronies.
Throw the bum out.
Just Like a Liberal Socialist Slug!... It's Always FUN to Spend Someone Elses MONEY!.... Obammy is Done in 2012!............
Whatever the taxpayers lost keeping GM afloat, will come back 10 fold as GM pays taxes on all this profit. And that will happen year after year after year.
GM is an American success story.
Sorry to inform you but while this appears to be a success what about all the business that GM owed money to who got nothing.
wait 5 years before you call it a success then we will have valid data.
By the way which auto union do you belong to
Freedon, GM kept their tax loss carry forward, they won't pay any taxes.
Not a success story at all, a disaster waiting to happen.
GM went bankrupt. Either way whoever they owed would have lost. The taxpayer was not obligated to make good on all of GMs old debts. Thats the gamble you take when you lend money or give credit, if a business goes bankrupt you lose.
Im was talking about taxes they will pay in the future, not what happened during the restructure..
People on the right would have loved to see GM fail and all those union workers and their families suffer. The GOP and their "Christian" values. Give me a f...ing break.
Ah yes, "the republicans want America to fail", the distant lost cry of the democrats with no facts and nothing to say.
People in this Country are figuring out what the right truly stands for and this election cycle will make that stark contrast.
Janus, the facts are all around you. Just observe how GOOD news about GM AND Chrysler brings out the negative comments about them AND their workers.
I have bought GM cars every two years from 1969 to 2003, next time Ford are nothing. F GM
Couldn't go anywhere but up, since they are bottom feeders. Let's see how well they do wittout government intervention. They wouldn't survive one year. Should have allowed them to fail
Repugs were unable to kill GM, now they are really pissed that it is soaring. OBAMA 2012!!!
So Tell me WHY!???????? Obammy is giving A $10,000.00 rebait OF OUR TAX DOLLAR ON A $47,000.00 car That GM is trying to SELL!????????????????....... I guess it's easy to SPEND SOMEONE ELSES MONEY! EVEN IF YOU HAVE TO BORROW IT! TO SPEND IT!.............. Obammy MUST GO!...........
The inept individual in the white house is trying to jump start his green fantasies.
You will note that on average, his green fantasies are costing the USA about 4 businesses a week.
GM's Profit soars from bankruptcy all the way up to to disappointing! Way to go Gov. Motors!
Wow hate and prejudice never cease to amaze me.
Uh huh--- the other distant lost cry of the democrat with no facts and nothing to say, "you're a racist".
Your next post can say, "Bush did it"
Just like Obammy SAID!.. Reward your FRIENDS AND PUNISH YOUR ENEMYS!....................
Time for senior management to give themselves a large bonus after all they did such a great job. You have to ask is this just a flash in the pan, or is it real.
Of course they should be making lots of money they got rid of all the BAD costs.
This money should be either reinvested in making them stronger (better technologies, equipment etc) or in paying back debts. It should not go to raises, stockholders or management bonuses or golden chutes.
They have no costs, except to the UAW of course, but, that was the whole point to the bail out.
Where's the taxes they have to pay? All you shills carping about taxes asking the question. Oh wait, that's right, GM was the only company in history that was allowed to keep their tax loss carry forward through a bankruptcy.
This is short lived folks. 5 years and GM's right back where they were except when they declare bankruptcy again it'll be the taxpayer who never gets payed.
GM will be the top selling car for the next decade, mark my words. Probably longer. They have a superior product and are selling Cars around the world in record numbers. Outselling every other automaker on the planet. You dont do that unless you're doing it right. GM will pay back the American taxpayer 10 fold in taxes alone on all that profit. Thats year after year after year. Well worth whatever it cost the taxpayer to keep GM afloat. Not to mention all the employees who can now participate in the economy. Hundreds of other business will also benefit because their wages will be spent in the economy.
Vote Obama, put more middle class Americans back to work, and save America from the Vulture capitalists.
Surely you jest, thGm still owes the Taxpayers 42billion dollars.
If GM paid taxes at the normal rate it would ta approximately 90 years to get it back, no interst.
As soon as Toyota gets over a crushing tsunami, and the absolutely astonishing attack by the OBama administration, they will put GM back in the shade again, because GM still operate under the severe handicap of the UAW.
The price of the GM stock would have to double just for the weary taxpayer to break even, no interest.
As about half of the USA will not buy their product or stock under any circumstances it is easy to see why the CBO predicts we never get back 14 billion of that.
Go Smoke another one and go lay Down!, You need a rest!...
Another Obamite, that can't do basic math.
My, there are a lot of you.