Do You Care About 40,000,000,000?

[Schorsch]

General Motors has announced that they made a loss of 40bln USD in 2007.
Is this the end of GM, or just a book keeping trick to justify the job cuts?

[Ancient Mariner]

With their present range of "cars", no trick.
Per

[Half Bottle]

GM's annual loss of $38.7 billion largely was due to a third-quarter charge related to unused tax credits.

Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006, beating Wall Street's expectations. Analysts polled by Thomson Financial expected GM to post a full-year loss of 95 cents per share.

GM shares were up yesterday.

[David Hilditch]

GM has been on a downward path for 30 years, with its market share in the US falling from around 50% to 15%. The "end" of the company may or may not be at hand, but it's all about managing decline right now. The $40bn loss was expected, but it's a meaningless figure : $38bn of that was a "paper" loss from writing off tax credits that the company decided it could never use - it's not actually money "lost".

[Schorsch]

GM has been on a downward path for 30 years, with its market share in the US falling from around 50% to 15%. The "end" of the company may or may not be at hand, but it's all about managing decline right now. The $40bn loss was expected, but it's a meaningless figure : $38bn of that was a "paper" loss from writing off tax credits that the company decided it could never use - it's not actually money "lost".

Maybe you know:
Does the company has a positive cash-flow?
Did they actually (not technically) earn money?

[Half Bottle]

GM has been on a downward path for 30 years, with its market share in the US falling from around 50% to 15%. The "end" of the company may or may not be at hand, but it's all about managing decline right now. The $40bn loss was expected, but it's a meaningless figure : $38bn of that was a "paper" loss from writing off tax credits that the company decided it could never use - it's not actually money "lost".

Maybe you know:
Does the company has a positive cash-flow?
Did they actually (not technically) earn money?

I don't know about thier cash flow, but the answer to your second question is right in the AP quote I excerpted: "Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006."

Also of note, GM reported profits (net of special items) in all regions in which they operate, except North America, where they lost (I think) about $1.5 billion.

[David Hilditch]

Maybe you know:
Does the company has a positive cash-flow?
Did they actually (not technically) earn money?

I don't know without checking. Even if they "actually" "earned" money, this is not necessarily indicative of cash flow. And you can have operational cash flow, which tells you certain things, as well as operational cash flow plus investment and capital movements. I suspect - wild guess only - that they did have a small operational net positive cash flow in 2007 but after severance payments, pension/health payments and other firefighting activities probably not bottom line cash flow. But as I say that's a guess only.