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Non-US sales growth limits General Motors' losses

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Date: Wednesday 30 Apr 2008

LONDON (ShareCast) - Shares in General Motors edged higher in morning trading in New York, despite the car manufacturer slipping into the red in the first quarter.

Excluding charges, the company’s first quarter losses were lower than expected at $350m, equivalent to $0.62 a share, compared to market expectations of negative earnings per share of more than $1.50.

Reported net losses totalled $3.25bn, compared with net income of $62m a year earlier, on revenue that fell from $43.4bn to $42.7bn. The losses included a $1.45bn write-down in the fair value of the company’s interest in its partially owned finance unit GMAC LLC, and a non-cash charge of $731m for estimated costs associated with its support for supplier Delphi.

North America was the only region where the company was unprofitable. North American pre-tax losses widened to $812m from a $208m shortfall a year earlier, reflecting the continued weakness of the US economy.

The company made a downward adjustment in the number of US vehicle sales for 2008 to the mid-to-high 15m range, from the previously issued guidance of sales in the low 16m range.