General Motors earnings article updated from 10:30 a.m. EDT with share prices, analyst comments and information from the company's quarterly conference call.



) -- Shares of

General Motors

(GM) - Get Report

were lower Thursday despite the automaker reporting better-than-expected first-quarter adjusted earnings of 95 cents a share.

GM was trading at $31.82, down $1.23, or 3.7%, in trading Thursday morning.

Net earnings for the first quarter nearly tripled to $3.2 billion, or $1.77 cents a share, from $900 million, or 55 cents a share, in the same period a year earlier, driven by strong car sales in the U.S. and China.

While GM's adjusted earnings topped analysts' expectations of 91 cents a share, vehicle prices disappointed analysts.

Prices for GM's cars and trucks dropped in North America and were flat in Asia and Europe. The only region they improved in was South America.

"The pricing headwind was not a material surprise, as GM very publicly increased incentives in the first half of the quarter," said Jefferies & Co. analyst Peter Nesvold.

In addition, GM's car prices were lower than its rival

Ford Motor

(F) - Get Report

, a fact that Morningstar analyst David Whiston referred to as "troubling."

GM's net income includes a $1.6 billion gain from the sale of its stake in Delphi Automotive, its former auto parts division. Without one-time items, GM earned 82 cents a share.

Revenue came in at $36.2 billion during the first quarter, ahead of analysts' estimates of $35.6 billion. Worldwide sales rose 12%, including a 25% increase in the U.S. and and a 10% gain in China, which has become GM's largest market.

GM attributed its quarterly gains to its small-car sales, such as the new Chevrolet Cruze, and its crossover vehicles such as the Chevrolet Equinox and GMC Terrain.

GM Chairman and CEO Daniel Akerson, on the company's conference call, said the automaker will focus on

expanding its smaller, more fuel-efficient vehicles

on anticipated global industry growth. GM reported that it sold up to 50,000 Chevrolet Cruze units in the first quarter alone.

On Wednesday,

GM said it was recalling 154,112 of its Chevrolet Cruze compact vehicles

to check that the steering shaft was properly installed.

GM North America reported earnings before interest and tax of $2.9 billion in the first quarter, compared with $1.2 billion in the year-prior period. The division increased its EBIT on an adjusted basis by $100 million to $1.3 billion.

The company expects GM North America's quarterly adjusted EBIT to improve over the remainder of the year as better pricing and improved fixed costs should more than offset commodity cost increases and unfavorable mix.

GM's South America segment saw its EBIT drop by $200 million to a total of $100 million.

Chevy Cruze: Symbol of GM Bankruptcy Win

The company forecasted strong business growth in South America, and said it expects to introduce at least 40 new products in the region over the next two years, according to Akerson.

GM's Europe division reported a loss of $400 million on an EBIT basis. GM said it expects Europe to achieve break-even adjusted earnings for 2011.

GM said it expects total 2011 adjusted earnings to show solid improvement over 2010, and doesn't forecast any material impact on full-year results from the Japan crisis.

The quarter marked the auto company's fifth consecutive quarterly profit since the end of 2009, when it emerged from bankruptcy.

--Written by Theresa McCabe in Boston.

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