GM has just announced, late, its financial results for the last quarter of 2006. And for the first time in years, it's in the black, with a net profit of $950 million. Now, GM isn't getting carried away about this (and neither should we) because in spite of this last-quarter uplift, overall in 2006, the world's biggest car maker (just, still) lost $2-billion. Which is still a major improvement on the $10.5 billion loss in 2005, and proof that CEO Rick Wagoner (above) was right to press on with GM's massive restructuring plan ($6.8 billion in cost cuts, 34,000 redundancies, 12 factory closures) and ignore merger overtures from Renault-Nissan, board-room bust-ups with billionaire investor Kirk Kerkorian and the looming threat of being overtaken by Toyota at the top of the charts.
What is especially heartening for GM is that the smaller loss (although it's a little mind-boggling to describe 2 billion of anything as smaller) and the final quarter profit was made on the same turnover ($51-billion in the last quarter of 2006) as in Q4, 2005. In other words, GM is making more (or at least losing less) on each individual car, crucial if it is to take on the Japanese challenge.
Meanwhile, across town at Chrysler, things are looking bleak. Reports have it that the books have been shown to takeover specialists Cerberus Capital Management, which means that a Mercedes sell-off of its troubled US arm is more and more likely. DaimlerChrysler chief Dieter Zetsche is saying nothing other than 'all options are being considered.' Which sounds to us similar to a Premiership chairman saying that the manager has 'the board's complete confidence.' Relegation beckons, we suspect.
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