GM posts $1.1 billion loss in Q1

April 19 | Updated: Apr 20 2005, 05:30am hrs
General Motors Corp, the worlds biggest automaker, reported a first-quarter net loss of $1.1 billion as US sales fell and the company lost market share. GM abandoned an annual forecast issued last month.

The loss, its biggest since 1992, was $1.95 a share, compared with net income of $1.28 billion, or $2.25 a share, in the same period a year earlier, the Detroit-based company said today in a statement. The loss was led by the companys North American automotive division and increases pressure on chief executive officer Rick Wagoner to cut costs, boost US sales and renegotiate labour contracts with his biggest union.

GM cited uncertainty affecting key elements of our financial forecast, such as resolution of the health-care cost crisis for withdrawing its 2005 forecast. On March 16, the company predicted earnings of as much as $2 a share this year before extraordinary items. It is very troubling for GM to withdraw its forecast for the year, Brian Bruce, who helps manage $17 billion at PanAgora Asset Management in Boston, including GM shares, said in an e-mail interview on Tuesday. Its a great concern that the company cannot forecast results nine months out. If they cant, who can

Mr Wagoner, 52, said last month that GM has to stop a US market share slump running at 80-year lows, reduce spending and find a way to beat back challenges from Toyota.

Bloomberg