Stocks dropped sharply Thursday over persistent fears about debt troubles in Spain and Italy and the American economy straddling the line of recession, but one bright spot was the sector Republicans slammed as dead in 2008 and that government took an active role in rescuing: cars.
General Motors indicated its second-quarter profits nearly doubled, thanks largely to increasing prices (and consumers being willing to pay them):
Second-quarter revenue rose 19 percent to $39.4 billion, while sales rose 7 percent. Although sales softened somewhat in the U.S. and Europe because of buyers’ worries about the economy, GM gained market share in every region outside South America.
It was the first time since GM emerged from bankruptcy protection two years ago that all of its regions were profitable. Europe, which is undergoing a restructuring, posted a profit of $100 million, versus a loss a year earlier. In North America, where the bulk of GM’s profits come from, the company earned $2.2 billion, up from $1.6 billion.
GM won more customers in the U.S. thanks to the Cruze, which was the best-selling car in America in June. The Cruze also sold well in China, where Chevrolet’s June sales rose 34 percent.
This is not to say the auto industry’s troubles are behind it so much as financial and business interests at large are nosediving at the same time a once-mocked sector of America’s economy — derided as a dinosaur that had no means of righting itself — is hinting at a major recovery.