Citing a troubled mortgage market and losses from their former financial arm, General Motors said Thursday its first-quarter profits were down 90 percent from a year ago. The nation's largest automaker reported a profit of $62 million for the first quarter, down from $602 million for the same quarter a year ago.
GM sold 51 percent of its former residential mortgage business GMAC Financial Services last year, but still owns 49 percent of the business.
The Detroit-based corporation reported automotive revenues of $42.9 billion in the quarter, down from $43.6 billion in the first quarter of 2006.
"We were able to expand vehicle sales and improve automotive profitability based on the progress in our turnaround initiatives in North America and Europe and our expansion strategy for key growth markets like China, Russia, and South America," Rick Wagoner, GM chairman and chief executive, said in a statement.
"We continue to see progress on the automotive bottom line as we implement the strategies laid out two years ago," he added.
Last week, GM Vice Chairman Bob Lutz said the crisis in the U.S. mortgage market has hurt U.S. auto sales this month. In addition, he predicted that the entire automotive sector would feel the impact of the stress on the mortgage market.