General Motors Posts 1st Quarter Results With Saab Automobile AB’s Total Reconstruction Costs

Posted on 09. May, 2009 by in 2000-2009

General Motors, a company that is not quite finished with Saab, has just posted their 1st quarter earnings yesterday.

As part of their press release with the details, they have included their cost for Saab Automobile’s reconstruction, a whopping $822 million effectively over 3-months (February 20th, 2009 – May, 20th, 2009).

Here is a snippet of their reference to Saab Automobile’s reconstruction costs below. While this figure is interesting, what would be even more interesting, would be an actual detailed line-by-line breakdown of the costs associated with this reconstruction, such as Guy Lofalks legal fees, vendors costs, and other costs not normally accounted for in normal operations for Saab Automobile. I wonder if the new advertising launch costs in Sweden, were also part of this that were recently mentioned here on Saab History with Saab Automobile’s Lowe Brindfors Swedish team.

The reported results for the first quarter of 2009 include special items and charges netting to a loss of $73 million. The special items include GM’s $906 million gain on debt extinguishment and $385 million related to GM’s portion of GMAC Financial Services’ (GMAC) gain associated with the accounting on its debt extinguishment. These items were offset by charges of $116 million for restructuring, a charge of $822 million related to Saab filing for reorganization, and a charge of $291 million in GM North America (GMNA) related to asset impairments. Charges of $135 million were recorded for advances made under the Delphi Advance Agreement. A reserve was recorded to write-off the receivable as it is deemed uncollectable.

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