GM says it plans to pay off government loans by June

DETROIT - General Motors Co., steadily returning to health after its near-collapse in 2009, said yesterday it plans to pay off its government loans by June - five years ahead of schedule - and could report a profit as early as this year.

GM said it lost $3.4 billion in the fourth quarter of 2009 on revenues of $32.3 billion. But things are on the upswing. Sales and production have increased and GM has gained U.S. market share since the start of the year. The automaker will try to maintain that momentum while facing a stiff challenge from a revitalized Ford Motor Co.

For the period from July 10, when GM emerged from bankruptcy protection after shedding billions in debt, through Dec. 31, GM lost $4.3 billion on revenues of $57.5 billion. But much of that loss was for one-time items, including a $2.6 billion payment to the United Auto Workers union for retiree health care. The company also reported several indicators of improving health: It took in $1 billion more than it spent in the period and began this year with $36 billion in cash and $60 billion in debt. At the start of 2009, it had $14 billion in cash and $104 billion in debt.

"General Motors should never again be in the financial position it found itself in last year," GM Chief Financial Officer Chris Liddell said during a conference call with analysts and media.

Repaying $6.7 billion in government loans has been a top priority for Chief Executive Officer Ed Whitacre. The government's autos task force set a repayment deadline of 2015 as a condition of giving GM the loans last year.

As of the end of March, GM has paid back $2.4 billion and Mr. Liddell said GM plans to pay the rest by June at the latest.

GM owes an additional $45.3 billion to the government. That will be repaid when GM makes a public stock offering, which Mr. Liddell said will happen "when the markets and the company are ready."

Mr. Liddell, who came to GM at the beginning of the year from Microsoft Corp., wouldn't say whether GM will make money in the first quarter, but said there's a good chance it will make a profit in 2010 based on first-quarter sales and production. GM plans to release first-quarter results next month.

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General Motors Co. is reporting increased sales and production since the start of the year. As of the end of March, the automaker had paid back $2.4 billion of its $6.7 billion in government loans. PAUL SANCYA / AP Enlarge

General Motors Co., steadily returning to health after its near-collapse in 2009, said Wednesday it plans to pay off its government loans by June - five years ahead of schedule - and could report a profit as early as this year.