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General Motors (NYSE: GM) has finally stabilized its North American business since the Detroit-based car manufacturer declared bankruptcy in 2009. But its overseas results aren’t quite so promising.
General Motors’ third-quarter earnings dropped 12 percent from last year due largely to the company’s shortcomings outside North America. GM reported earnings of $1.73 billion from July through September, down from $1.96 billion in earnings during last year’s third quarter.
Though it made $2.2 billion in North America over the last quarter, GM lost $292 million in Europe. That’s actually a vast improvement over its European earnings during the 2010 third quarter, but well short of GM’s goal to break even in a market where it has traditionally struggled. Considering the escalating debt crisis in Europe, GM’s losses on the continent – about half of what they were a year ago – weren’t that bad.
South America also wasn’t kind to General Motors. The company lost $44 million there, down from the $163 million profits it made there a year ago. Rising costs were partly to blame, GM’s finance chief Daniel Ammann said during this morning’s earnings announcement.
Sales were better in emerging markets, but still down from a year ago. GM’s earnings in China, India, and Russia were $365 million, nearly 30 percent less than the $516 million its international operations unit made during the third quarter in 2010.
Despite its overseas struggles, General Motors posted its seventh straight quarter in the black – a figure that would have seemed unfathomable two years ago. But the company’s year-over-year earnings decline and struggles in Europe and South America was bad news for its short-term stock outlook. Shares of General Motors were down 8 percent to $23.00 in early trading today. That’s still above the $19.05 low GM stock hit on Oct. 3, but well below its 52-week high of $39.48.
General Motors went public almost a year ago, on Nov. 18, 2010.