General Motors surprised analysts by reporting a larger than expected third-quarter profit and by announcing it plans to break even in Europe by mid-decade.
Profit amounted to $1.5 billion, while net income dropped to $1.83 billion from $2.1 billion a year earlier, the company said today in a statement. However, the reported profit is 50 percent larger than analysts’ estimates. Excluding one-time items, the profit was 93 cents a share, beating the 60-cent average estimate of 17 analysts surveyed by Bloomberg.
GM had a strong performance globally with the exception of Europe, according to chief financial officer Dan Ammann. The automaker, which has lost $17.3 billion in Europe since 1999, said it will have a deficit of $1.5 billion to $1.8 billion this year in the region. GM said it expects slightly better results in 2013. The automaker lost $478 million in Europe in the third quarter before interest and taxes, from an operating loss of $292 million a year earlier.
In North America, the Detroit-based carmaker posted a $1.82 billion profit before earnings and taxes. International operations, which include China, had earnings of $689 million, from a $365 million operating profit a year earlier. The increase came from regions other than China, where profit margins are under pressure.