GM Earnings - The Real Story Behind the Numbers

NEW YORK (TheStreet) -- General Motors(GM) reported 4th quarter earnings, and would you know it? Much of the media focused on the company's record-setting full year numbers. The automaker's weak 4th quarter was subordinated or completely ignored. Worse, the reason for the late year fizzle in GM's business, which will impact the company going forward, was not even mentioned.

Sometimes, we catch the media in measured oversights. This was mammoth. The Financial Times, for example, ran a full-year centric headline: "GM earnings hit record $7.6bn in 2011." Remarkably, they mentioned GM's full-year net income, but nothing about the 4th quarter.

The Wall Street Journal also led with the flashy full-year number, but at least they got around to the troublesome fourth quarter, though the cause they trotted out was incomplete: European weakness. That's a half-story, at best.

Here's the whole deal: GM had an unrealistically easy first portion of the year. Tsunami related disruptions in Japan sent Japanese automakers like Toyota(TM) and Honda(HMC) reeling. For that small window of time, GM was playing against a reduced field of competition. But as Japan recovered as the year progressed, business at GM snapped off. Japanese automakers are now back to stay and wouldn't you know it? GM's management was maddeningly vague about 2012 forecasts.

The link is clear and it's pathetic the media is not making it. Don't be fooled.

>To order reprints of this article, click here: Reprints