General Motors 1Q profit dragged down by recalls - DC News FOX 5 DC WTTG

General Motors 1Q profit dragged down by recalls

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  • More than 600 file lawsuit against GM over ignition switches

    More than 600 file lawsuit against GM over ignition switches

    Wednesday, July 30 2014 4:04 PM EDT2014-07-30 20:04:48 GMT
    Another legal bump in the road for General Motors. Now, a lawsuit has been filed by more than 600 people. They say they had GM cars recalled for faulty ignition switches and suffered injures, or are related to someone who died in a crash. They filed the lawsuit because they say they are not covered in the victims compensation program. Their problems came apparently after the bankruptcy. the law suit was filed in New York.The lawsuit filed Tuesday in U.S. District Court names 29 people who wer...
    Another legal bump in the road for General Motors. Now, a lawsuit has been filed by more than 600 people. They say they had GM cars recalled for faulty ignition switches and suffered injures, or are related to someone who died in a crash. They filed the lawsuit because they say they are not covered in the victims compensation program. Their problems came apparently after the bankruptcy. the law suit was filed in New York.The lawsuit filed Tuesday in U.S. District Court names 29 people who wer...
  • GM issues 6 more safety recalls

    GM issues 6 more safety recalls

    Wednesday, July 23 2014 4:00 PM EDT2014-07-23 20:00:12 GMT
    General Motors issued six more recalls on Wednesday, bringing its annual total to 60 recalls covering almost 30 million vehicles.
    General Motors issued six more recalls on Wednesday, bringing its annual total to 60 recalls covering almost 30 million vehicles.
  • Local families still waiting for GM compensation

    Local families still waiting for GM compensation

    Thursday, July 17 2014 7:19 PM EDT2014-07-17 23:19:37 GMT
    As the investigation into GM's deadly recalls continues with a compensation fund set up for families affected, questions come of who qualifies and who doesn't.
    As the investigation into GM's deadly recalls continues with a compensation fund set up for families affected, questions come of who qualifies and who doesn't.
DETROIT (AP) -- General Motors on Thursday reported its worst quarterly performance in more than four years as the costs of a series of recalls dragged down earnings.

First-quarter profit fell 86 percent to $125 million. The Detroit automaker took a $1.3 billion charge for recalling about 7 million vehicles worldwide. GM also incurred $300 million in restructuring costs, mostly in Europe. And it took another $419 million charge due to a change in the way it values Venezuela's currency.

GM made 6 cents per share, down from 58 cents per share a year ago. The recall charge alone cut 48 cents off GM's first-quarter earnings.

Excluding one-time items, GM made 29 cents per share, far above Wall Street estimates of 3 cents per share.

It was a disappointing start to what many expected would be a strong year for GM. The U.S. government, which bailed out the automaker five years ago, sold its remaining stake in the company at the end of last year, freeing GM of the "Government Motors" nickname. In January, the company announced its first quarterly dividend in six years. And GM has rolled out multiple new models in recent months including high-profit pickup trucks and full-size SUVs.

But the recalls overshadowed the first quarter under the leadership of new CEO Mary Barra, the first woman to lead a major automaker. In February, GM announced it would recall more than a million older small cars because the ignition switches can slip from "run" to "accessory" or "off," shutting down the engine. That knocks out power steering and brakes and can cause drivers to lose control and crash. It also disables the air bags. Later, the recall was expanded to 2.6 million cars, and other recalls took the number to near 7 million.

GM admitted knowing about the problem at least a decade ago. Thirteen people have died in crashes linked to the problem, according to GM, although relatives of the victims say the death toll exceeds 30.

The financial results were GM's worst since late 2009, when it posted a $4.4 billion loss for the five months after leaving bankruptcy protection.

Even so, the company's revenue for the quarter was strong. GM took in $37.4 billion, up 1.3 percent from the year-ago quarter and in line with analysts' estimates.

GM's global sales for the quarter rose 2.3 percent to 2.42 million cars and trucks. China sales grew 13 percent, and sales in Europe rose less than 1 percent. But sales fell 2 percent in North America, GM's most profitable region. Sales fell 10 percent in South America.


The company's North America division earned $600 million. Without the recall charge, it would have earned $1.9 billion, up from $1.4 billion a year ago. Sales in the region fell to 745,000 cars and trucks.
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  • Officer hit by drunk driver on Detroit's east side

    Officer hit by drunk driver on Detroit's east side

    Friday, August 1 2014 11:15 PM EDT2014-08-02 03:15:06 GMT
    An officer was hit by a driver believed to be drunk Friday at 8 mile and Alcoy on Detroit's east side.Police say officers were investigating at the scene of a traffic accident when the driver ran through the barricade and hit the woman.She was transported to an area hospital with non-life threatening injuries and the drunk driver was arrested. Police had been conducting an investigation of the original accident in which one of the drivers died. Eight mile is closed in east bound lane by Alcoy.
    An officer was hit by a driver believed to be drunk Friday at 8 mile and Alcoy on Detroit's east side.Police say officers were investigating at the scene of a traffic accident when the driver ran through the barricade and hit the woman.She was transported to an area hospital with non-life threatening injuries and the drunk driver was arrested. Police had been conducting an investigation of the original accident in which one of the drivers died. Eight mile is closed in east bound lane by Alcoy.
  • Federal sting ends in gunfire in Highland Park

    Federal sting ends in gunfire in Highland Park

    Friday, August 1 2014 10:37 PM EDT2014-08-02 02:37:55 GMT
    In what started as a traffic stop, resulted in a shootout between federal agents and a pair of men known to have illegal assault rifles in Highland Park.Police say a task force of ATF and FBI agents who had previously set up a meet with two men, known to have AK-47s and AR-15s in their Chevrolet Cavalier, began to move in. The traffic stop was made near Oakland and Victor about 7:30 p.m. Friday. The car rammed the federal agents vehicle and the driver opened fire with a handgun. The agents re...
    In what started as a traffic stop, resulted in a shootout between federal agents and a pair of men known to have illegal assault rifles in Highland Park.Police say a task force of ATF and FBI agents who had previously set up a meet with two men, known to have AK-47s and AR-15s in their Chevrolet Cavalier, began to move in. The traffic stop was made near Oakland and Victor about 7:30 p.m. Friday. The car rammed the federal agents vehicle and the driver opened fire with a handgun. The agents re...
  • Man arrested after trying to wrestle gun from officer in Detroit

    Man arrested after trying to wrestle gun from officer in Detroit

    Friday, August 1 2014 9:32 PM EDT2014-08-02 01:32:44 GMT
    A man was arrested after he went for an officer's gun trying to wrestle it away from Detroit Police, causing the weapon to fire.SkyFOX was over the scene on Manning Street in Detroit, where the incident occurred Friday,The bullet didn't hit anyone and police took a 27-year-old man from Roseville into custody.Police say the home was a known drug den, and when officers drove by the property -- four people ran from the home.The officer and suspect were treated at a hospital for non life threaten...
    A man was arrested after he went for an officer's gun trying to wrestle it away from Detroit Police, causing the weapon to fire.SkyFOX was over the scene on Manning Street in Detroit, where the incident occurred Friday,The bullet didn't hit anyone and police took a 27-year-old man from Roseville into custody.Police say the home was a known drug den, and when officers drove by the property -- four people ran from the home.The officer and suspect were treated at a hospital for non life threaten...
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