GM Drives to $1.3 Billion Profit in 2nd Quarter

VOA News
August 12, 2010 at 12:45 pm

U.S. automaker General Motors says it made $1.3 billion in profits for the April through June period – the company’s best performance in six years.

GM announced the quarterly results Thursday, crediting strong sales in North America and China.

This is the second quarter in a row GM has made money since it emerged from bankruptcy last year. The company made $865 million for the first three months of the 2010, its first profitable quarter after years of billion-dollar losses.

The largest U.S. automaker avoided a complete collapse last year when the U.S. government rushed to the rescue with an emergency $50 billion bailout.

GM must pay the money back and still owes the government about $43 billion. The U.S. currently has a 61 percent stake in the automaker.

The U.S. government will be able to recoup some of the money when GM starts selling shares of the company to investors. Officials say that could happen within days.

In the meantime, GM is preparing for new leadership.

Chief Executive Officer Ed Whitacre told reporters Thursday he will step down September 1.

The 68-year-old Whitacre joined GM as chairman of its board of directors as the company emerged from bankruptcy in July of last year. He made several changes to the company after he took over as chief executive last December.

Whitacre said it had been his plan to help return GM to greatness and that he “didn’t want to stay a day beyond that.”

He will be replaced by GM board member Daniel Akerson. Like Whitacre, Akerson has a background in telecommunications.

GM is the last of the major U.S. automakers to report quarterly results.

Earlier this week Chrysler reported a $172 million loss, less than its loss for the first three months of the year. Chrysler, the smallest of the U.S. car companies, also received a government bailout.

The number two U.S. automaker, Ford, reported a $2.6 billion second quarter profit last month.

Ford did not take a government bailout, and industry trade groups say the company has been selling more cars than either of its U.S. rivals.

Late last month, U.S. President Barack Obama called the country’s bailout of the auto industry a success during a tour of several auto factories in the central state of Michigan. Some information in this story was provided by AP, AFP and Bloomberg.