DETROIT — In less than a year, General Motors has roared back from bankruptcy to a quarterly profit. Now comes the hard part: sustaining the income and repaying billions of dollars in government aid.
There are signs that GM is on track to do just that. Revenue is up 40 percent over the first quarter of last year. U.S. sales rose 17 percent for the quarter, and the automaker made an operating profit in North America, which had been a cash incinerator. Units in Asia and Latin America posted strong numbers too.
As a result, GM said Monday its net income rose to $865 million, a dramatic reversal from the $6 billion it lost in the same period last year.
To keep GM afloat and get it through bankruptcy court, the U.S. government gave the company $50 billion. GM repaid $6.7 billion that the government considered loans, with the remaining $43.3 billion converted to a 61 percent stake in the automaker.
For the Treasury to break even, GM will have to make a lot more money and show prospects for even more profits in the future for its shares to be worth enough to cover the debt. The Associated Press
