Automotive Industry Sees Record Earnings and Major Business Deals

Strategic Insights -

The automotive industry is witnessing a remarkable surge in earnings, with General Motors reporting record fourth-quarter earnings of $1.8 billion. This feat is attributed to the company's strong vehicle sales and cost-cutting measures. Additionally, labor disputes and restructuring efforts are contributing to the industry's overall growth.

Key Takeaways:

  • General Motors reported record fourth-quarter earnings of $1.8 billion, exceeding $1.6 billion in the same period in 1997.
  • The company's quarterly net earnings topped $2.64 a share, compared with $2.29 a share in 1997.
  • GM's global revenues totaled $46.4 billion in the fourth quarter, an 8% increase from the same period in 1997.
  • The company will distribute $200 profit-sharing checks to 231,000 U.S. workers.
  • DaimlerChrysler AG announced two significant business deals, including the consolidation of Chrysler Financial's $82 billion portfolio with Berlin-based debis, making debis the world's fourth-largest non-bank provider of financial services.
  • DaimlerChrysler agreed to purchase a stake in the world's leading railroad engineering company, Adtranz, for $472 million, with the European firm ABB owning 50% of the company.
  • Nissan Motor Co. Ltd. awarded Canadian fuel-cell developer Ballard Power Systems a $2.3 million contract for fuel cell supplies in a research and development program.
  • Old Kent reported lower fourth-quarter earnings of $37.9 million, or 36 cents a share, compared with $47.3 million, or 42 cents a share, in the same period in 1997.
  • Ford's renowned designer Claude Lobo is retiring after 32 years with the company, having helped pioneer computer-aided design and design various Ford models, including the 1999 Focus.
  • Detroit Diesel Corp. completed its 500th Series 2000 marine engine, a 16-cylinder, 1,800 horsepower unit built for a 65-foot vessel manufactured by Viking Yachts.
  • Federal-Mogul Corp. was awarded a contract to supply the total engine sealing package for DaimlerChrysler's new engine, scheduled for introduction in the 2003 model year.

Statistics:

  • General Motors' quarterly net earnings: $1.8 billion
  • Annual earnings for General Motors in 1997: $6.3 billion
  • Old Kent's fourth-quarter earnings: $37.9 million
  • Old Kent's annual earnings for 1998: $198 million
  • Annual earnings for General Motors in 1998: $3 billion
  • Chrysler Financial's portfolio: $82 billion
  • Debris' revenues: $14 billion
  • Debris' employees: 23,800
  • Ballard Power Systems' contract with Nissan: $2.3 million
  • DaimlerChrysler's stake in Adtranz: $472 million
  • Detroit Diesel's Series 2000 marine engine production: 500 units
  • Series 2000 engine horsepower: 1,800 horsepower
  • Series 2000 engine cylinders: 16

Sources:

  • "GM posts record earnings in 4th quarter"

+ DETROIT, Jan. 20 (UPI)

  • "DaimlerChrysler announces two deals"

+ AUBURN HILLS, Mich., Jan. 20 (UPI)

  • "Nissan to buy fuel cells from Ballard"

+ DETROIT, Jan. 20 (UPI)

  • "Old Kent earnings slip in 4th quarter"

+ GRAND RAPIDS, Mich., Jan. 20 (UPI)

  • "Ford's designer Lobo retiring"

+ DEARBORN, Mich., Jan. 20 (UPI)

  • "Detroit Diesel builds 500th 2000 engine"

+ DETROIT, Jan. 20 (UPI)

  • "Federal-Mogul wins engine-sealing job"

+ SOUTHFIELD, Mich., Jan. 20 (UPI)