GM turns full-year profit despite strike, slumping sales

Despite a 40-day strike by factory workers and slumping sales in the US and China, General Motors still made money last year.

The company posted a USD 6.58 billion profit for the year, but that was down almost 17 per cent from 2018.

GM couldn't avoid red ink the fourth quarter, though. The automaker lost USD 232 million, or 16 cents per share, largely because most of the strike by the United Auto Workers union happened during the quarter.

Excluding one-time items for employee separations and the sale of a Chinese joint venture, GM made 5 cents per share, soundly beating Wall Street estimates.

Analysts polled by FactSet expected a profit of 1 cent per share.

Revenue for the quarter was USD 30.8 billion, down almost 20 per cent from a year ago. That fell short of Wall Street estimates of USD 31.2 billion.

The company still made USD 8.2 billion in North America for the full year, so about 47,000 US factory workers will get USD 8,000 profit-sharing checks this month.

That's down from USD 10,750 in 2018.

GM said the strike, which ran from September 16 through October 25, cost the company sales of 191,000 vehicles and cut quarterly pretax earnings by USD 1.39 per share.

For the full year, the strike cost GM USD 1.89 per share, the company said.

The bitter strike paralysed GM's US factories and cut production in the US and Canada before it was settled.

The company expects pretax earnings of USD 5.75 to USD 6.25 per share this year, about flat with 2019 when strike costs and profits from its investment in the Lyft ride-hailing company and stock warrants in France's PSA Peugeot are backed out.