cbr9two9guy

DETROIT — General Motors (GM) sharply lowered its earnings guidance Wednesday, citing lower North American sales and production volumes and a tougher pricing environment.

The world's biggest automaker said it expects a first-quarter loss of about $1.50 a share, compared with a previous target of break-even or better. It expects income of $1 to $2 a share for the full year, down from its previous guidance of $4 to $5.

GM stock tumbles more than 10% to its lowest point in more than 12 years.

David Cole, director of the Center for Automotive Research, said he expects others in the auto industry to have similar problems. "This will not be the only company where you're going to see this kind of comment," he said.

Higher fuel and raw material prices, such as steel, were creating a "perfect storm with a confluence of a large number of factors that are causing severe pressure across the entire industry" and particularly hurting companies like GM, he added.

GM said its finance arm, GMAC, as well as its other sales regions, were on track to meet their targets.

"Clearly we have significant challenges in North America. The rest of our automotive businesses, and GMAC, are running in line with, or ahead of, our expectations," Chairman and CEO Rick Wagoner said in a statement. "But North America is our biggest business, and the key driver of automotive earnings and cash flow. So it's important that we get this business right."

GM's profit fell 37% in the fourth quarter, and the automaker has said it expects a rough start this year. The company's U.S. sales rose only slightly in January, and results for February were off 12.7% from last February.

The earnings revision may put downward pressure on GM's credit ratings, which hover precariously close to "junk" status. Debt from GM, one of the largest U.S. corporate debt issuers, has recently traded at junk levels. If the credit rating was lowered, the interest due on debt would rise.

Standard & Poor's in January affirmed GM's senior debt rating at "BBB-minus," one notch above junk, but said it is considering changing the company's stable outlook by mid-year, if not sooner. Analyst Scott Sprinzen declined immediate comment.

Moody's Investors Service rates GM "Baa2," one notch higher, with a "negative" outlook. It rates the debt of General Motors Acceptance Corp. "Baa1," which is one notch above "Baa2." Analyst Bruce Clark declined immediate comment.

Fitch Ratings in October cut GM and GMAC debt to "BBB" with a negative outlook. Its analysts could not immediately be reached.

GM's previous first-quarter guidance was based on North American production volumes of 1.5 million vehicles. Since then, production schedules have been cut by about 70,000 units.

The company also attributed the lowered guidance to a more competitive pricing environment and a more car-based vehicle mix.

GM last week announced a new round of incentives designed to move slow-selling vehicles off dealer lots.

John Devine, GM's chief financial officer, said the tough pricing environment means the company must seek ways to cut costs.

"While we have made good progress in reducing costs over the last several years, the projected loss in North America reinforces our need to do much more, particularly in the area of health care," he said in a statement.

GM said it was encouraged by the "building momentum" of some recently introduced vehicles, including the Chevrolet Equinox, the Pontiac G6, the Buick LaCrosse and the Chevrolet Cobalt, and by the product launches scheduled for this year.

rocketjoe

Dont let Flip read this he will go ape sh*t on your azz.

C6matt

I guess all those unemployed GM people will have to cancel their cable

Big Jarsh

Well I hear Burger King in Lapeer is hiring. You guys could go work there, they are in need.


Big Jarsh

rocketjoe

Jarsh did you call in a bomb threat at Lapear today?

C6matt

bomb threat where in lapeer? BK?

cbr9two9guy

I found a pic of josh.. must been a close up

Duke Nukem

That shiit about GM is a fact. They cancelled all raises for 2005 and took away their contributions to the 401K. Guess what has happened to the union people so far...................Nothing. Go to school, get a degree, work your fuccking *** off and get screwed over someone without a highschool degree. Only America.

BUY AMERICAN WHEN EVER POSSIBLE AND SAVE JOBS. Crap like this affects all, not just automakers. All suppliers will be hurt, all area stores and sales. It sucks.

C6matt

we still get 20 cents per dollar...we should be thankful

Big Jarsh

Tony, that is freaking disgusting.



Big Jarsh

Cuddles

Which one? The first post or the one with the picture? both of 'em are pretty sickening.

XFlipX

WHAT!!! Why the ***** are all of you soooo loyal to Corporate America??? It does not work...and look you are all proving it!! ***** Corporate America...besides the employee was not the reason for the basis of the economic system in the USA...it was the Entrepanuer (spelling?)...

the CEO of your company is still bringing in millions of dollars a year and taking pay increases when-ever and where-ever possible...the funny thing is he is not the owner and in that light he has no assesed risk...

The stock holders and unions keep voting the smarter workers out of jobs proving that 95% of our culture doesn't value education, but conversely they would rather recieve sh!tty work for lower cost...

***** the UNION and ***** Corporate America, they will cut you at the drop of a hat...no matter what, you are just a number when you came in and now you are a number when you leave...but hey ***** it just be thankful for that nice $.20 matched on your 401k.

Flip

C6matt

# 1 I was kidding, it suxx

#2 I like my corprate job because (for example) if you asked me to stop by to help you with somthing I wouldn't have to ask for gas money... it has ups and downs but I like having my chit paid for..

have a nice day :YEAH

Big Jarsh

well, what do you suggest we do then Flipper? Everyone go work at BK? or everyone come up with their own Ideas and market? Or should we just become a Communistic society???


Big Jarsh

XFlipX

That was more of a charge for being a pU$$y who can't unload his own bike!!

Flip

PS I know you were kidding!!

BigJeff

BK is a Corporatation so that is out of the question. To hell with the world as the ole master of good liven said. To hell with it I am just a number and the sooner you realize your one too Flip the better off you will be. I guess that Social Security Number you have must say you're special or is it just a number like everyother person in the USA? I love listening to Flip's spin on the US and Corporate America. He must have been screwed over by the Goverment or Corp America at one time. So where do you work Flip? :YEAH

Now lets drink some Beer and stop being serious about issues everyone is clearly going to have a different views on.

LOL

Jeff

XFlipX

Social Security....blLahahahahshahshahahah Ballahhahhahh that won't be around for my generation you old phucker!! It is just as useless as my tax dollars being used in Flint!

Flip

PS Where is everyone drinking tonight!??

Duke Nukem

I actually agree with something Flip said (see quote), everything else his head is in his ***. You don't have family to support, it's a lot different view when you have kids you need to raise in a good area put through school. Thats why all the dumb *** comments come from youngsters in college. The real world is awaiting. *****, if I didn't have kids I could move in with you, work at Speedway and probably be happier than hell sitting around drinking beer all day.

Borne

Well, who's choice was that?

BigJeff

It won't be around for me either. But guess what I am still paying the SS taxe. Also they still give out SS numbers. The point wasn't will you ever get any of the money you pay in SS tax, it was the fact that you are already a number.

Jeff