The world’s biggest auto group General Motors announced Wednesday that fourth-quarter profits slumped 58% in the wake of US recession and economic crisis in Argentina.

Earnings for Q4 came in at $255 million, down from $609m a year earlier, on revenues down 8% year-on-year to $45.9 billion.

The results give GM full-year earnings of $601m, a colossal 86% down on 2000. Despite recent finance deals, wholesale vehicle sales slid 11% last year. Nevertheless, the auto giant expressed confidence in its earnings target for 2002 of $3 per share, announced last week [WAMN: 11-Jan-02].

Meanwhile, GM’s German arm Opel posted its worst ever operating loss for 2001, coming in at E674m. Chief executive Carl-Peter Forster said the unit would consequently bring forward a restructuring scheme.

Some 2,500 German staffers now face the chop this year (previously redundancies were to be spread into 2003), and the company will impose a pay freeze.

As a result of such cost-cutting, Opel plans to make an operating profit in 2003. In addition, it plans to introduce a series of new models, with a fresh car due to hit the market every six months. It holds particularly high hopes for the new Vectra, out in April.

News sources: Financial Times; Handelsblatt (Germany)