General Motors Co reported first-quarter net income of $865 million, helped by higher production and smaller discounts, as the auto maker works toward an initial public offering.
Operating profit was $1.2 billion in the first three months of the year, and the company generated $1 billion in free cash flow, Detroit-based GM said today in a statement.
Chief Executive Officer Ed Whitacre has said reporting a profit is a necessary milestone as the biggest US auto maker seeks independence from government ownership. GM also is considering a return to the auto-lending business to make its initial offering more appealing to investors, people familiar with the plans said.
“The results emerging from a tumultuous 2009 make a solid first rung on the ladder to long-term viability,” said Michael Robinet, vice president of global forecasting for CSM Worldwide in Northville, Michigan.
GM’s sales in the US rose 16.8 per cent to 475,253 vehicles in the first quarter from 406,770 a year earlier, according to researcher Autodata Corp. Industry-wide, US sales gained 15.5 per cent in the period after falling to 10.4 million last year, the worst since 1982. The annualised rate for the first quarter was about 11 million cars and trucks.
GM trimmed its US customer discounts in the first quarter by an average of $230 per vehicle, or 6.7 per cent, to $3,222, according to Autodata.
