GM profits hit by recalls bill

<p>GM stocks fell following the firm’s latest financial results.</p>

The share price of General Motors (GM) fell yesterday (April 24th) following the release of the latest financial results by the car manufacturer.

Stocks in the company slipped after it was revealed the cost of recent recalls has damaged the profits made by the firm.

GM announced that its first quarter profits have been hit by a $1.3 billion (£774 million) charge over the recall of various vehicles due to potentially dangerous faults.

"Obviously, the recall campaign charges in the first quarter overshadows the headline results, but if you look underneath that, we had strong performance across the board," chief financial officer Chuck Stevens said.

GM revealed in a statement that $300 million was needed to cover the cost of courtesy cars, while net income was down to just $125 million, which is compared with $865 million in the same period last year.

Sales were announced at $37.4 billion, up from $36.9 billion in the first quarter of 2013.

GM stocks fell by 0.64 per cent on the New York Stock Exchange following the release of the financial results yesterday.

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