General Motors profits dive, aims to reopen US plants May 18


General Motors profits dive, aims to reopen US plants May 18

Friday, May 08, 2020

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NEW YORK, United States (AFP) — General Motors (GM) said Wednesday it aims to reopen most US and Canadian manufacturing operations on May 18 as it reported a steep drop in first-quarter earnings due to the coronavirus.

The US auto giant reported that first-quarter earnings plunged 86 per cent to US$294 million on lower car sales, especially in China, where the coronavirus raged for much of the quarter.

Revenues fell 6.2 per cent to US$32.7 billion. Both earnings-per-share and sales topped analyst expectations.

Car sales also declined in the United States, although the impact was mitigated by gains in GM's full-size pickups.

Analysts expect a bigger hit to US sales in the second quarter. Many GM dealers are open for service and online car sales, but retail operations are skeletal in many cases.

GM said it has a May 18 target to resume auto production under enhanced safety measures that it said exceed Government guidelines.

With the hit from shuttered production plants and lower car sales, GM has taken steps to retain cash and boost liquidity.

The company, which in April suspended its divided, ended the quarter with US$33.4 billion in liquidity.

Shares jumped 6.1 per cent to US$22.55 in pre-market trading.

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