Why is GM profitable again? 5 Theories

GM's gone from an embarrassing U.S. bailout to its first profit in years — and commentators have no shortage of explanations

How did GM bounce back?
(Image credit: Getty)

Just a year after General Motors' humiliating slide into bankruptcy and 61 percent U.S. government ownership, the former No. 1 automaker actually turned a profit — its first since 2007. GM earned $865 million in the first quarter, compared with a $6 billion loss a year earlier, and even had a $1.2 billion operating profit in the troubled North American market. How did the disgraced Detroit icon go from bailout to profitability in one short year? (Watch a Reuters report about GM's recovery.) Here are five theories:

1. GM made the best of bankruptcy

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE
https://cdn.mos.cms.futurecdn.net/flexiimages/jacafc5zvs1692883516.jpg

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up