GM reports record $39 billion loss in third quarter after write-downs

Mumbai: US auto giant General Motors Corp reported a $39 billion loss in third quarter, reflecting an equal amount of charge related to unclaimed tax credits and a loss at its former finance subsidiary GMAC.

General Motors posted a net loss of $39 billion, or $68.85 per share, compared with a loss of $147 million, or 26 cents per share a year earlier. Total revenue fell to $43.8 billion from $48.9 billion a year earlier. Excluding one-time items, GM reported a net loss of $1.6 billion, or $2.80 per share.

The write-down reflects a darkening outlook for the US economy, as GM cited mortgage-related losses at its partly owned GMAC LLC finance unit and "more challenging" auto-market conditions in the US and Germany.

GM said the results also reflected an after-tax gain of $3.5 billion from the sale of its Allison Transmission unit, $1.6 billion in pension-service costs related to prior labour agreements, and $400 million in charges connected to its former Delphi Corporation subsidiary.

GM attributed the charge to a "three-year historical cumulative loss" in the US, Canada and Germany.

GM had a net loss of $757 million related to its 49 per cent stake in GMAC, which posted a $1.6 billion third-quarter loss on November 1. GM sold 51 per cent of GMAC last year to a group led by Cerberus Capital Management LP.

GM said it had previously determined it wouldn't need the allowance for the US, Canada and Germany because losses over the three-year period were caused by one-time expenses.