General Motors Co. announced on Thursday that it made $1.33 billion in profit during the second quarter, an indication that the beleaguered automaker is moving toward a public stock offering.
GM CEO Ed Whitacre said last week that the company will be eager to begin its initial public offering so that it can end its dependence on the government and pay off $43.3 billion worth of bailout funds which were converted into a majority stake in the company. Whitacre said that the company plans to file IPO paperwork in the near future, but many wonder whether the two recent profitable quarters is enough to convince investors to invest in the company.
The U.S. automaker had revenue of $33.2 billion, up 5.3% compared to the first quarter. The firm showed sales growth in every region except Europe. In the U.S., GM benefited from strong sales of its Chevy Equinox and Buick LaCrosse. The company said that it made $2.55 per share during the quarter, compared to a net loss of $21.12 per share during the second quarter of 2009.
The automaker isn’t out of the woods yet, though. G.M’s sales increased at 14% during the first half of 2010 compared to 2009, but that number was still less than the industry average of 17%. GM still has the highest incentive spending of any automaker at $3,691 per vehicle, about $1,000 more than the industry average. The automaker also relied heavily on fleet sales which are less profitable than sales to individuals.
During the second quarter, Ford Motor Co. (NYSE: F) made $2.6 billion and Chrylser had a net loss of $172 million.
