General Motors gm on Wednesday announced a $3.3 billion loss for the first three months of the year on $42.7 billion in revenue due to weak U.S. vehicle demand, plant shutdowns caused by a supplier strike and losses at a partly owned finance company.
The nation's biggest automaker also cut its industrywide U.S. sales outlook for the year. The company disclosed earlier this week it was cutting production of some of its slow-selling trucks and SUVs.
The quarterly results compare with a loss of $42 million on revenue of $43.4 billion in the same quarter last year.
Excluding special items, the automaker said it posted an adjusted net loss of $350 million, or 62 cents per diluted share. Analysts surveyed by Thomson Financial had expected a loss of $1.60 a share. On a comparative basis, GM reported a $10 million loss in the same quarter last year.
GM's loss included a $1.45 billion charge to reflect a change in the value of GM's interest in GMAC Financial Services and $731 million to increase GM's liability in Delphi's ongoing bankruptcy.
In light of the results, GM revised its U.S. sales outlook for the year. The Detroit automaker now expects total U.S. sales in the high 15 million range, down from the low 16 million range at the beginning of this year.
"We want to run our business conservatively. We want to be realistic," said Ray Young, GM's executive vice president and chief financial officer.
Young said GM expects the second quarter to be a tough one for the industry. He said GM continues to predict a recovery in the second half of the year, although it will not be as robust as the company believed at the beginning of this year.
GM said the strike at American Axle & Manufacturing Holding, which has stopped or reduced production at 31 plants, has cost it $800 million. GM records profit when vehicles are shipped from the factory, so production cuts decrease revenue.
Decreased U.S. vehicle demand led to an $812 million pretax loss in North America, GM's largest division, worse than the $208 million loss by the region last year.
However, GM said its other regions, and particularly the emerging markets of Brazil, Russia, India and China, continued to grow.
GM Europe posted a $75 million pretax gain, up from a $4 million profit in the first quarter of 2007.
GM's vast Latin America, Africa and the Middle East division posted a $517 million pretax profit, more than double the $254 million it reported in the same period last year.
And GM Asia Pacific reported a $286 million pretax profit, up from $143 million a year earlier.
"We continue to leverage our global product portfolio to take advantage of tremendous growth in key emerging markets, while at the same time taking the appropriate actions to deal with the challenging economic conditions in the U.S.," GM Chairman and Chief Executive Officer Rick Wagoner said.