General Motors reported a better-than-expected quarterly net profit, helped by cost cuts, and promised to cut production. Fred Katayama reports.
General Motors' quarterly profit dropped, and revenue dipped as the company sold fewer cars. But cost cutting helped the automaker's bottom line beat analysts' forecasts. Wall Street is concerned the U.S. auto industry is entering a downturn after several years of strong sales. Automakers have reported declining sales for the past four months. But Autotrader's Michelle Krebs says GM's results are solid, and the company is navigating a difficult landscape. (SOUNDBITE) MICHELLE KREBS, SENIOR ANALYST, AUTOTRADER (ENGLISH) SAYING: "I think the challenge for companies like General Motors, and all established automakers, is focusing on the core business because that's what's generating today's profits and today's dividends, but, also, at the same time, investing in he future, so things like electric vehicles, autonomous vehicles, mobility technologies and solutions, that are not going to have a payoff for a while. So, they have these two roads they have to travel on, and that's gonna be a very tricky business." Inventories jumped in the latest quarter. During its earnings call, GM promised to cut production in the second half to slash the company's supply of vehicles.