GM sees steady growth in emerging markets revenue
DETROIT (Reuters) - General Motors Corp's (GM.N) revenue in Latin America, Africa and the Middle East will grow by a few billion dollars each year through the rest of the decade, the automaker's president of those regions said on Tuesday.
Speaking to reporters at a dinner, Maureen Kempston Darkes said GM had grown its revenue in those regions to about $15 billion in 2006 from about $5.4 billion in 2003.
"I think we will see a similar growth in revenue through the rest of the decade, unless there are some unforeseen circumstances," Kempston Darkes said.
Revenue from Latin America, Africa and the Middle East accounted for 8.4 percent of GM's total revenue in 2006.
Kempston Darkes also said GM will likely increase capacity by adding third shifts at many Latin American assembly plants to meet higher demand for vehicles in the region.
"The industry is running faster than our ability to keep up with it," she said. "We will have to increase capacity because we are selling everything we are making," she added, declining to specify a timeline on the expansion.
GM, the largest U.S. automaker, sold a record 1.04 million vehicles in the Latin America, Africa and Middle East region in 2006, up from 605,000 in 2002.
Kempston Darkes, who took over management of the region in 2002, said she expected another year of record sales in 2007.
She also said she expects the growth in Latin America, which accounts for 67 percent of sales in the regional unit, to be sustainable.
"We have some longevity in Brazil and Argentina," she said, citing "very strong" prices of commodities exported by the two countries, lower interest rates and a higher influx of foreign investment.
"This period of growth has quite a likelihood of continuing into the next several years," she said.
GM, which has been struggling in the United States -- its largest and historically most profitable market -- has been growing overseas even as it loses market share to Japanese competitors such as Toyota Motor Corp at home.
After losing more than $10 billion in the past two years, GM is restructuring its North American operations by closing 12 plants and slashing more than 34,000 jobs.
In the second quarter, GM's sales in North America fell 7 percent, but sales in Latin America, Africa and the Middle East rose 20 percent.
Overseas sales accounted for 58 percent of total sales in the second quarter, and GM Chief Executive Rick Wagoner has said he expects sales outside the United States to continue surpassing domestic sales in the next few years. Continued...
