GM Europe Sales Drop Sharply in August

GM EU sales dropped 14.7% in August to 44,985. It has been passed by rival Ford Motor Co. (NYSE: F), which sold 47,133 vehicles, up 17.4% for the month. GM’s market share in August 2013 was 8.0% and dropped to 6.7% this past month.

GM’s trouble has also dropped it to fifth place in EU sales among all manufacturers that sell cars and light trucks there. Volkswagen’s share was 28% (in contrast to its U.S. failure), PSA Group (which makes Peugeot) had a share of 9.8%, followed by Renault Group at 9.3%. Just behind GM was Fiat (which has taken over Chrysler) with a 5.1% share. The two primary luxury brands did remarkably well given their limited product lines. BMW’s share was 6.6% in August, and Daimler (maker of Mercedes) posted a 5.6% number.

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All figures were provided by the European Automobile Manufacturers Association (AECA).

In the second quarter of 2014, GM had revenue of $39.6 billion, up from $39.1 billion in the same period the year before. Net income dropped to $200 million from $1.2 billion in the year-ago quarter. While GM had an operating profit of $1.385 billion in North America, European operations lost $305 million.

The company’s reflection on the numbers:

“With successful new vehicle launches, we continue to generate strong results in the U.S. and China and remain on track to be profitable in Europe by mid-decade,” said Chuck Stevens, GM executive vice president and chief financial officer. “We are confident we are currently on or ahead of plan to deliver the results we promised earlier this year, excluding the effects of recalls.”

With European sales dropping so quickly, GM needs to hope it can significantly restructure and drop costs, which is difficult in a region where unions are strong and national governments want to keep their populations employed.

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