GM posts $15.5 billion loss, mainly due to restructuring – Aug. 1, 2008
by Tom on August 1, 2008
in Market Musings
General Motors reported a huge second-quarter net loss Friday of $15.5 billion after restructuring and other charges.
The automaker lost $27.33 per share in the quarter, compared to a profit of $784 million, or $1.37 per share, a year ago.
Even factoring out those charges, GM posted a stunning $6.3 billion loss on operations. That works out to $11.21 per share, far above the $2.62-a-share loss projected by Thomson Reuters.
GM posts $15.5 billion loss, mainly due to restructuring – Aug. 1, 2008.
A couple of thoughts on this:
1. I expect part of the loss has to do with the gas prices and the fact that GM (in my opinion) doesn’t have the best record in terms of fuel effecient cars.
2. If gas is that much more expensive, people aren’t going to be comfortable taking on another $300 a month in a car payment.
3. If the job market isn’t strong, then people aren’t going to be comfortable with taking on more obligations either.
Another sign that the economy isn’t moving along very strongly (to say the least).
Jobs report comes out in about 10 minutes – I’ll post some thoughts on that as soon as I have a chance to read the “whole” report not just the headlines.
Tom Vanderwell
