General Motors Company (GM): What Lies Behind Its Lower Losses?

How the other automakers are managing?

It is needless to say that all car makers are struggling in Europe.

Volkswagen AG (FRA:VOW), which had held its ground for a long time, has also finally given in. In the first quarter the company saw its automotive revenue fall by 3.5% to $54.3 billion, while operating profits dipped 31.7% to $2.5 billion.  All this is primarily attributed to the weakness in Europe.

However, the company is still trying to match its operating profits for 2013 with last year’s levels. In order to counter the European uncertainty Volkswagen AG (FRA:VOW) will launch as many as 60 new models this year across the globe to keep its demand high. Management has set a goal to become the world’s largest automaker by 2018.

Ford Motor Company (NYSE:F) is still expecting to lose around $2 billion this year. Although like General Motors Company (NYSE:GM) it is also hoping to return to profitability by 2015, analysts are of the opinion that Ford is lagging GM in terms of a turnaround. Ford’s European revenue during the quarter came in about 7% lower than last year, and wholesale volumes were down 8%.

Ford Motor Company (NYSE:F) is trying to make up for its European losses by driving exceptional margins in its North American operations. Its margins in the core North American market were 11%, compared with GM’s 6.2%.

So, where does GM stand?

General Motors Company (NYSE:GM)’s hard work to cut losses in Europe seems to be paying off, and its restructuring plans are on target. Europe has been a concern for so many years now that the company’s return to profitability in the region is going to be a huge catalyst for the stock.

The article Are the Tides Turning for GM in Europe? originally appeared on Fool.com.

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