Evening star., 1941-04-28
General Motors Corp.
Reports Earnings
Below Year Ago
Quarters Net Reduced
SO Per Cent; Taxes
Up 52.l Per Cent
By The Associa ted Press.

NEW YORK, April 28-Despite
new aIl-time records" in sales, Gen
eral Motors Corp. reported today
March quarter consolidated earnings
after taxes were 36 per cent less
than in the like 1910 period
Before taxes they were 52.l per
cent higher.
The quarterly statement showed
net earnings for the first three
months of this year of s64 ,5S8, 1897, or
s144 a common share, compared
with S67 ,028, ,461 or Sl50 share, in
the comparable 1910 quarter.
However, the General Motors pro-
portion of net income before taxes
was $129, 9,750,337 in the recent period
compared with S85, ,33l ,461 last year.
Net sales totaled $649 1872 ,619 in the
opening 1941 quarter, compared with
S458, ,l50 $50 in the like three months
last year, an increase Of Alt per
cent.
Busy Period Reviewed.
Alfred P. Sloan, jr., chairman, re-
ported to stockholders:
The period under review was
characterized by rapidly rising
trend of industrial activity along a
broad front, rejecting the stimula-
ton to the economy by the program
of national defense "''
Practically speaking. this is what
is happening: AS projects involving
national defense develop, they act as
motivating centers. Pay rolls in
crease due to the lengthening of
working hours and the addition of
workers. New pay rolls are estab-
lisheG as additional plants reach the
state of productivity.
The purchasing power thus Gre
ated is resulting in a rapidly ex-
panding demand for consumer goods.
This stimulates production in plants
not directly concerned with the de-
fenSe program. This in turn has
the effect of increasing the number
of workers and extending the hours
of employment all of which serve
to pyramid the purchasing power
for consumer goods.
Dig huSn SctH hntdu.
Thus, the whole economy be-
comes affected. Relatively speaking,
few of the plants specially designed
for the production of materials for
national defense have as yet reached
the productive state. Their eco
nomic effect up to now has been
limited TO stimulating the capital
goods industries. which have shown
an extraordinary rise in activity.
"As more and more of these de-
fense plants come into production
they begin to provide additional en-
ployment directly, and indirectly
through their demands for materials
and supplies.
Thus the demand for consumer
goods is still further increased. In
all probability the peak will not be
reached for some months to come"
Sloan said the increase in General
Motors sales reflected this growth
Of industrial activity. but indicated
the probability Of sales difficulties
ahead with the words: TT is nor
mally the practice of the corpora
ton to build up dealer stocks during
the first quarter Of the year to pre-
pare for the increased retail sales
resulting from the normal upward
seasonal trend which sets in during
March and continues into the month
of May.
This year that has been impos-
sible due to lack Of productive ca
pacity. Therefore, the corporation
enters the spring selling season with
subnormal dealer stocks. which in
all likelihood will prejudice its abil-
ity to meet the increased demands
for its various products"
Wage Average Higher.
The General Motors chief reported
hourly employees worked an average
of 419 hours for an average pay of
s4124 a week in the first quarter
compared with 374 hours for s34 SO
in the 1910 period, the increase
largely representing overtime pay.
The quarters payroll totaled $751;
786,261, an increase of 377 per cent
over the $114,578,562 of the 1910
quarter.
This year. the average number of
employees was 29e $40 compared with
247678 last year.
Sloan disclosed that 76 per cent
of the company's total sales volume
in the first quarter-about S49 1885,
000-consiSted of deliveries of special
defense material to the United
States, British and Canadian gov
ernmentS.
National defense deliveries, he
said, have totaled s108, ,932 900 since
the beginning of the program.
Said Sloan Attention is called
to the fact that by far the greater
number of projects assumed by the
corporation in relation to the ma
tional defense program involve spe-
cial plants and equipment.
The production stage for many
items has not yet been reached and
will not be. to substantial degree,
until we'll into the third quarter"