Detroit, Michigan – General Motors’ third-quarter earnings more than doubled to $2.8 billion. The vast majority of those record profits came from North America, where booming sales of trucks and sport utility vehicles are bringing high profit margins to automakers, despite falling car sales.
Average revenue per vehicle sold in North America was more than $30,000 in Q3, up about $1,000 from a year ago. In addition, sales were higher, pushing GM to better-than-expected revenues and profits.
Headwinds during the quarter included higher material costs and cost associated with launching several new cars into a market that’s fairly indifferent toward sedans for now. Outside of the booming North American market, European and South American losses were slightly lower ($100 million loss, an improvement from 2015’s $200 million loss in both cases), and Asian results were flat. In Europe, currency issues lowered results, with some of the blame going to the Brexit decision for Great Britain to leave the European Union.
“Our record third quarter, led by strong performance in the U.S. and China, reflects our determination to deliver on our commitments. We will continue executing our plan to deliver earnings that enhance shareholder returns,” GM Chairman and CEO Mary Barra said.
At $42.8 billion, third quarter revenues were up 10.3% and far exceeded Wall Street expectations. Operating income more than tripled, and earnings per share more than doubled.
Source: General Motors Co.