G.M. reports second loss in N.Z.

Press, 19 June 1979, Page 21

G.M. reports second loss in N.Z.

General Motors New Zealand, Ltd, recorded a net loss of $2,215,000 in the year to December 31. In the previous year the company had a net loss of $906,601.

The acting general manager (Mr L. B. Lyons) said in the latest annual report that the latest loss was caused by the unfavourable economic climate, and the difficulty of recovering higher costs in an increasingly competitive market. Despite the lack of profitability and the constricted market, General Motors had every confidence in the future, and was accordingly making additional investments in New Zealand in 1979, particularly in relation to the country’s export drive. It has made a SSM investment in equipment to manufacture axle tube assemblies for export to the

associate company in Australia.

The company is now engaged on a SIM project to increase the production of spark plugs, mainly for export to Australia, and other overseas markets.

A further $2.2M is being spent upgrading its truck and commercial plant at Petone, where the spark plugs, and axle assemblies, are manufactured. “The car market was very competitive in 1978, and will continue to be so during the present year. However, the introduction of the new Commodore range, with its improved fuel economy, and advanced design, will boost General Motors’ share of the passenger car market during the latter part of 1979.

“Despite the generally difficult trading conditions last year, General Motors maintained its vehicle sales

level at that of 1977. “Passenger car sales! accounted for 14 per cent of the total market for the year — a drop of 1.3 per cent from 1977, but in the commercial and heavy truck market, the company further; increased its leadership by 2.2 per cent to 31.8 per cent of the market,” said Mr Lyons. A dividend to the United States parent company, of $1,500,000, was declared from previous years profits, of which $150,000 was paid to withholding tax.

The balance sheet shows total shareholders’ funds at $30,598,243, compared with $33,813,652, which included paid up capital of $10,000,000 (250,000 ordinary shares of $4O each). Term liabilities were decreased from $3,463,946 to S2.OM. Net fixed assets totalled $12,768,153 ($13,666,670).