NEW YORK (CNNMoney.com) — General Motors, no stranger to hard times and red ink, still managed to shock Wednesday when it reported an operating loss more than 11 times larger than expected and a $39 billion charge that was among the biggest profit hits ever reported.

The nation’s No. 1 automaker, which was hit with a soft U.S. auto market and a two-day strike by the United Auto Workers union during the quarter, lost $1.6 billion, or $2.80 a share, excluding special items.




Among the problems hurting GM results was a $2.3 billion loss in the home loan business at GMAC due to problems from the meltdown in subprime mortgages. GM sold a majority of GMAC but still owns 49 percent of the lender.

In addition, GM took a huge charge in the quarter related to the writedown of tax credits for losses over the last three years.

That caused it to post a net loss of $39 billion, or $68.85 a share, for the third quarter, compared with the net loss of $147 million, or 26 cents a share, in the year-earlier period. Only a gain from the sale of the Allison Transmission unit stopped the loss from being worse.

In addition, the charge is significantly larger than the $12.4 billion net loss posted by GM for all of 2005 and 2006, when the company was hammered by falling shares and labor costs far in excess of its nonunion rivals. The company had net income of $953 million for the first six months of the year before hitting the problems in the third quarter.

Revenue from auto sales rose to $43.1 billion from $39.6 billion a year earlier. That topped First Call’s revenue forecast of $40.3 billion. The automaker sold a record 2.39 million cars and trucks worldwide in the quarter, enough to edge back in front of Toyota Motor in the race to be the world’s largest automaker in terms of vehicle sold.

Cliffnotes (for those lazy mofos): GM posted a huge $39 billion loss in the third quarter due to accounting charges, even as its global auto operations reported a profit sending shares to new lows.

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