GM swaps red ink for black

Nothing like a near-death experience to get the blood pumping.

And so it is with General Motors today announcing second quarter net income of US$2.5 billion, marking the company’s sixth consecutive profitable quarter.

On its knees financially in mid-2009, the US Government had endorsed a Chapter 11 (bankruptcy) reorganisation of the automotive giant, taking 61percent ownership in the process. A combination of a GFC-induced drop-off in consumer demand, massive pension liabilities and loss making subsidiaries (Saab, Saturn, Hummer, Pontiac) had crippled a GM already bathed in red ink from five loss-making years prior. The company at one stage planned to also sell its Opel, Vauhxall and Holden subsidiaries.

But thanks to the rationalisation of its global brand portfolio, successful new product introductions and thriving joint venture operations in China, the nearly 93 year old corporation is solidly back in the black.

Following a public offering late last year US federal government ownership in GM was reduced to 33percent (now 27percent), and according to GM Chairman and CEO Dan Akerson, ''GM's investments in fuel economy, design and quality are paying off around the world as our global market share growth and financial results bear out. Our progress has been steady and we’re preparing to launch more new products this year, including the Chevrolet Sonic (next gen Holden Barina) in North America, the Opel/Vauxhall Zafira in Europe and the Baojun 630 in China to keep the momentum going.''