General Motors blames Brexit for European division's losses

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General Motors says the Brexit vote was to blame for its European division making a loss last year.

The American owner of Vauxhall said that the European arm of its business was $300 million (£240m) in the red because of currency devaluation caused by Britain voting to leave the European Union. It claims it would have broken even otherwise.

Last October, the car manufacturer warned that factories could be shut across Europe because of currency devaluation. It called the UK's vote to leave the EU "a speed bump on our path to where we want to take the business" and claimed that it was "prepared to take whatever action is necessary" to turn its European division around.

Mary Barra, chief executive of GM, said yesterday that she was "not satisfied with these results".

The news contributed to GM shares falling 5.3 per cent to $34.87 in New York yesterday, as the company also revealed forecasts of no growth for the coming year. The last three months of 2016 saw profits drop to $1.8 billion (£1.4bn) from $6.3bn (£5bn) in the same period in 2015, a fall of more than 70 per cent.

The huge losses come off the back of a difficult week for GM in the UK. Top officials from the company were grilled by MPs over its response to the Vauxhall Zafira fires that saw hundreds of thousands of cars recalled.