GM Europe's Tow Truck (GM)

GM Europe is going to make money this year, and, so they say, more money next. Its earnings for the first three quarters of 2006 are $196 million. Sales in Russia are likely to rise.

The company said that lower costs and higher revenue yield for each car will improve results in 2007.

What is missing from this picture? GM North America, which has gotten into the bad habit of losing money. What’s up? Europe has as many competing car companies as North America, perhaps more. All of the Japanese sell cars there. Odd.

GM does not talk about the lessons it has learned in Europe as a template for North America. GM Europe lost money the first three quarters of last year, and has turned that red ink black.

Some one please connect the dots. Before it gets too late.

Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.