GM posts first quarter loss
TEXT OF STORY
Renita Jablonski: General Motors lost more than $3 billion so far this year. But hey, that’s nothing compared to what the automaker lost last year — try $38 billion. The company blames challenging U.S. market conditions, and ongoing labor issues for its problems. It also took a one time charge related to its mortgage unit. Marketplace’s Janet Babin reports from North Carolina Public Radio.
Janet Babin: GM’s investment in finance company GMAC cost it nearly $1.5 billion in one time charges in the first quarter. That and other strike-related charges more than offset the profits GM is seeing from China and Europe. The company insists that even though the headlines don’t look great, its cost-cutting strategy is beginning to work. But management consultant Pam Murtaugh says costs don’t matter if you can’t get the U.S. consumer’s attention.
Pam Murtaugh: They have yet to build cars that people want in every driveway, because their strategy is to focus on niches.
Niches like the Escalade, an upscale SUV. Peter Delorenzo is editor at AutoExtremist.com/.
Peter Delorenzo: They have to make serious cuts in their divisions and models and be realistic as to what they can market in this country.
Cadillac, Chevrolet and Saturn can stay, but Delorenzo says Pontiac and Buick have to go.
I’m Janet Babin for Marketplace.
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