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Pickups rev up GM profits

Redesigned ’14 trucks boost automaker’s bottom line

Akerson

– General Motors, the largest U.S. automaker, posted a third-quarter profit that beat estimates as demand for redesigned pickups and other models in North America made up for losses in Europe and Asia, with the exception of China.

Profit excluding one-time items was 96 cents a share, Detroit-based GM said Wednesday. That compares with 93 cents a year earlier.

GM’s new cars and trucks in the U.S., such as the revamped Chevrolet Silverado and GMC Sierra pickups, along with booming sales of Buicks in China, boosted revenue to $39 billion from $37.6 billion a year ago.

Chief Executive Officer Dan Akerson is betting the new products will help GM meet several mid-decade goals including increasing North America operating margins, stemming losses in Europe and boosting sales in China.

“We’re in the very heart of the product launch activity right now and we’re going to build on the momentum that we’ve established here,” Chief Financial Officer Dan Ammann said.

Net income dropped in the third quarter to $1.72 billion from $1.8 billion in the same quarter a year ago.

GM’s U.S. operations are benefiting from 18 new or refreshed products being introduced this year, including the Silverado, which hadn’t been redesigned since 2006. Large pickups are among GM’s most profitable vehicles.

GM builds Silverados and Sierras at its Allen County assembly plant, where it employs about 4,000 workers on three shifts.

The automaker plans 14 more new vehicles in the U.S. next year.

In the U.S., new products have helped GM sell vehicles at higher prices. The average transaction price for GM vehicles in the third quarter rose 3 percent to $31,626 from the second quarter, according to auto sales tracker Edmunds.com.

Those prices were boosted in part by people paying 6.7 percent more for pickups.

“The redesigned Silverado and Sierra lead the segment in quarterly ATP growth,” Jeremy Acevedo, an Edmunds analyst, said in an e-mail. The Sierra, the GMC brand large pickup, was also redesigned.

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