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Europe holds back GM's profit

Europe holds back GM's profit
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There was mixed profit news from General Motors as the US carmaker made far more money in its home market than industry watchers had expected.

Worldwide GM’s profit last year jumped 62 percent to a record $7.6 billion (5.8 billion euros).

Global sales were up by 7.6 percent and it regained the number one spot from Toyota.

For this year GM sees improved sales but unchanged market share.

But problems persist in Europe where GM is restructuring Opel, closing plants and laying off workers at a cost of $200 million in the fourth quarter.

For the year, the Opel unit reported a loss of 535 million euros about half of its losses in 2010.

GM Chief Financial Officer Dan Ammann said: “We clearly have work to do in Europe.” He added the company has to cut costs further.

Ammann said GM was working with union leaders at Opel to cut costs and improve efficiency in Europe within the framework of the current contract that runs through 2014 in Germany.

Opel union leaders this week urged GM to shift production of Opel vehicles from South Korea to Europe.

Chief Executive Dan Akerson also said GM is focused on tackling the problems in Europe and South America,
the two markets that dragged down its fourth-quarter results.

GM’s ability to raise US vehicle prices and the fact that its pension fund shortfall was not as large as feared sent its shares up more than six percent.

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