Recalls Trim GM’s Profits

General Motors Co. netted $1.1 billion in the fourth quarter of 2014 compared with $900 million a year earlier. But a record volume of recalls cut full-year profit to $2.8 billion from $3.8 billion in 2013.

Earnings before interest and taxes jumped 27% to $2.4 billion in the fourth quarter. But EBIT fell 24% to $6.5 billion for the full year.

Results, including the company's best fourth quarter since it emerged from bankruptcy in 2009, were better than analysts expected. Citing strength in its underling business operations, GM says it will increase its second-quarter dividend this year to 36 cents per share from 30 cents currently.

GM's revenue for last year's final quarter slipped 2% to $39.6 billion and was virtually flat at $156 billion for all of 2014. Special items most of them related to conducting 84 campaigns to recall 30.4 million vehicles worldwide nearly tripled to $2.3 billion in 2014.

Wholesale vehicle sales, which exclude vehicles made by unconsolidated joint ventures, shrank 4% to 1.58 million in October-December and 6% to 6.03 million for the year. GM notes that 53% of its wholesale volume last year was generated outside the U.S.

GM's retail sales, which include cars and trucks built by joint ventures, rose 2% to 9.93 million units last year, including 3% to 2.55 million in the fourth quarter. Full-year volume improved 6% in North America and 8% in Asia Pacific/Middle East/Africa but fell 10% in Europe and 15% in South America.