General Motors profits hit $2bn but 'Europe still needs fixed'

General Motors, owner of Vauxhall in the UK, posted a $2 billion (£1.25bn) third-quarter profit yesterday, driven by an accelerating turnaround in North America as it rushes to complete an initial public offering of stock set for next week.

GM said it expected to post its first full-year profit since 2004. A large part of that could be attributed to North America, which had previously posted deep losses.

Chief executive Dan Akerson said: "We know we have much work to do, we still have to fix Europe."

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Earlier this month, GM released details for its planned IPO that will allow the US treasury to reduce its stake in the company.

GM reported earnings before interest and tax of $2.3bn overall, with $2.1bn from North America. It also generated free cash flow of $1.4bn and revenue of $34.1bn.

The company emerged from its government-funded bankruptcy in July 2009, making year-ago comparisons less relevant. Its profit topped US rival Ford Motor's $1.7bn third-quarter profit, and Chrysler's $84 million net loss for the quarter.

GM expects earnings before interest and tax to be significantly lower in the fourth quarter than it was through the first three due to vehicle introduction costs and spending on future products among other expenses.