The latest financial news from the beleaguered auto industry appears grim at first glance. Hampered by a $2.6 billion payment to its union, General Motors reported a $4.3 billion loss in the second half of 2009. Though CFO Chris Liddell noted the loss included a large one-time payment, he admitted that right now GM is deep in the red.
Despite the multibillion dollar loss, business bloggers agreed with Liddell's claim that the company had "a chance of achieving profitably" in 2010. Continuing a trend of optimism towards American automakers (while Toyota continues to take heat from the government), many leading financial blogs viewed GM's filings through a hopeful lens.
- New Tone for GM "General Motors tried to set a new tone in its relations with the financial community today," reports an approving Alex Taylor at CNN Money, who notes the company's "new emphasis on of corporate themes (to build world-class cars and trucks)." Taylor strikes a cautiously optimistic tone regarding GM's financial future. "The bad news is that GM still has a long way to go to become competitive in some areas. The good news is that there is lots of room for improvement."
- Upcoming Product Lines Bode Well At True/Slant, Joe D'Allegro posits Liddell's optimistic forecast "may not be misplaced," due in large part to a number of enticing new vehicles.
The company has a number of promising new cars in the pipeline, such as Cadillac’s huge and luxurious XTS, Chevy’s hyper efficient Cruze and Volt (the latter of which is expected to have an EPA rating of 230 miles per gallon), and the Buick Regal, a sporty import from the company’s German division.
- Note the One-Time Payout Barron's Tiernan Ray crunches GM's numbers and leads with the bad, noting the company lost $3.4 billion in the fourth quarter of 2009 alone. "However," he adds. "$2.6 billion of the company’s cost of goods in Q4 was a result of a “settlement cost” as a result of a deal with the United Auto Workers to take over responsibility for paying retirees’ healthcare costs." Take away that unique financial millstone, and "it would appear the true net loss for Q4 is about $800 million, a slight improvement [from] Q3."
- A Start, but Only a Start Despite the many "areas of progress," PBS' Jason Breslow warns readers not to expect GM shares to hit the market anytime soon. "The nation's largest automaker has a ways to go before it can begin offering shares for public trading," he cautions. "GM still owes the United States $4.7 billion, and before the government will sell its majority stake in the company, the automaker must demonstrate that it is healthy enough to survive without government aid."