GM Posts Massive Q4 Loss

27 January 2006

World number two carmaker General Motors on Thursday posted a $4.78 billion (€3.91bn; £2.68bn) fourth-quarter net loss - a result that sent Richter-scale tremors through the markets.

The deficit brings GM's total loss for 2005 to an eye-watering $8.6bn, exceeding Wall Street's worst expectations. It compares with a $2.8bn net profit in 2004.

Q4 is the auto titan's fifth consecutive quarterly loss - and its first annual dive into the red since 1992. It blames rising costs of layoffs and factory closures, high legacy costs and consumers' rejection of gas-guzzling SUVs.

Much of the Q4 loss is down to a $1.3bn charge arising from the company's restructuring plan [WAMN: 08-Jun-05]. Admits morose chief financial officer, Fritz Henderson: "There are no highlights really. The losses are unacceptable."

North American operations were the greatest loss-maker, draining $5.6bn over the year, of which $1.8bn came in the fourth quarter.

Comments London analyst Neil Sutherland: "People had low expectations and these results came below those, which was a surprise after better-than-expected figures from Ford earlier this week," [WAMN: 25-Jan-06].

Data sourced from; additional content by WARC staff