Vauxhall in profit after firm sheds hundreds of jobs

Reporter:

Phil Robinson

GENERAL Motors is back in the black for the first time in three years.

Results for the first quarter of this year show the revitalised automotive giant turned in an operating profit of $1.2 billion.

This compares with a series of massive losses before the group slid into bankruptcy in 2009.

Its European arm, which includes Vauxhall Motors and its plant at Ellesmere Port, recorded a loss before interest and taxes of $0.5bn. But that is an improvement of $0.3bn from the final quarter of 2009.

GM’s global revenue grew 40 per cent from a year ago to $31.5bn as it increased production by 57 per cent.

Savings from massive lay-offs, factory closures and billions in debt shed through the government-funded bankruptcy drove down GM’s costs.

To help haul it out of bankruptcy the group received $50bn in US government loans.

The company has repaid $6.7bn ahead of schedule, but the big payback will not come until GM goes public again and the government can begin selling its majority stake.

Chris Liddell, GM’s vice-chairman and chief financial officer, said: “We’re pleased with our first quarter performance, in particular achieving profitability.

“In North America we are adding production to keep up with strong demand for new products in our four brands.

“We’re also steadily growing in emerging markets, keeping our costs under control, generating positive cash flow and maintaining a strong balance sheet.

“These are all important steps as we lay the foundation for a successful GM.”

The latest results are in line with the optimism for the future shown by GM Europe’s chief executive Nick Reilly when he visited the Ellesmere Port plant in March.

The factory employs 2,000 workers, hundreds of them from Chester, Flintshire and Wrexham areas.

He said the plant’s performance, as part of a rejuvenated operation, made it “very much a contender” to build General Motors’ new hybrid electric car.

He also spoke of the planned introduction of a third shift at the plant to cope with expected demand for the new Astra estate, which would be built alongside the hatchback model, probably from November.

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