GM earnings

Dan Grech Jul 26, 2006
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GM earnings

Dan Grech Jul 26, 2006
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TEXT OF STORY

SCOTT JAGOW: We’ll find out today how General Motors did last quarter. The carmaker’s expected to turn a small profit, but on the balance sheet, it’ll look like a loss. That’s because GM had to shell out a bunch of money to get workers to retire early. This is all part of GM’s turnaround strategy. More now from Marketplace’s Dan Grech.


DAN GRECH: General Motors lost more than $10 billion last year. The prompted a mini revolt among its stockholders.

Kirk Krekorian, GM’s largest shareholder, is pressuring the carmaker to sell a 20 percent stake to rivals Renault and Nissan.

PETER MORICI: “General Motors is a fundamentally sick company. Its labor costs are too high and it doesn’t make cars that people want to buy.”

Peter Morici is an auto industry expert at the University of Maryland.

MORICI:“General Motors needs to make significant profits for a long time to make up for the losses it’s endured over the last several years and to have the monies it needs to develop the new vehicles and new technologies to compete with the Japanese in the future.”

GM still has tough negotiations ahead as it tries to lower costs and boost slumping sales.

I’m Dan Grech for Marketplace.

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