GM to incur more than $5 billion in impairment charges and writedowns on its China business

Dow Jones12-04

MW GM to incur more than $5 billion in impairment charges and writedowns on its China business

General Motors Co.'s stock $(GM)$ slid 2.9% early Wednesday, after the company said it expects to incur more than $5 billion in impairment charges and writedowns related to its China business. In a regulatory filing, the car maker said it expects to book an impairment charge of $2.6 billion to $2.9 billion in the fourth quarter on a China joint venture, and to incur additional equity losses of about $2.7 billion to cover restructuring costs. The company has a 50-50 joint venture with SAIC Motor Corp. Ltd., called SGM, as well as an equity interest in SAIC-GMAC Automotive Finance Co. Ltd. SGM operates in China through other joint ventures with GM. The audit committee of the board determined that a material impairment was required due to a material loss in value of the investments in certain China joint ventures following a new business forecast and the need for restructuring actions. GM's stock has gained 49% in the year to date, while the S&P 500 has gained 27%.

-Ciara Linnane

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December 04, 2024 06:44 ET (11:44 GMT)

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