European losses puts brakes on General Motors

GENERAL Motors, the US parent company of Vauxhall, has reported a full year profit of $4.9bn, despite rising quarterly losses in Europe.

The Detroit-based giant, said fourth quarter net income rose from $500m to $900m, despite it racking-up $699m (£451m) in losses from its European division, Opel, which it is in the midst of restructuring through plant closures, more efficient working and flexible operations.

The company employs around 3,000 people in Ellesmere Port, where the Astra is made.

GM noted that it “delivered a third straight year of profitability and took significant actions to put the company on a solid path for future growth”.

Losses in Europe totalled $1.8bn for all of 2012, more than doubling from 2011, reflecting the rapid deterioration of vehicle demand and economic conditions in the region. It was the 13th straight year of losses in Europe.

Chief financial officer Dan Ammann said GM still sees industry sales in Europe declining in 2013 and is “not betting on” a pickup later in the year.

The quarterly figures were boosted by a turnaround in South America, where the company reported a $99m profit after having recorded a loss a year earlier.

It took a $5.2bn charge on its European assets during the quarter but added that “it does not reflect any change to the company’s objective to break even in its European operations by mid-decade”.

The European car market contracted by 8.2% in 2012.

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