Is General Motors' China Boom in Trouble?

GM's Buick Excelle GT is a close sibling of the U.S.-market Buick Verano. It has been one of China's best-selling cars. But is GM's China boom now in trouble? Photo credit: General Motors Co.

General Motors reported a strong profit on Wednesday on gains in North America and ongoing improvements in Europe. Excluding some one-time items, GM's pre-tax profit was $2.6 billion, higher than Wall Street estimates and beating many expectations for the still-recovering Detroit giant.

But one of GM's operations didn't impress when the company reported on Wednesday. That would be GM's international operations unit, which includes the company's massive presence in China. That unit's profits dropped to just $299 million in the third quarter, down from the $761 million GM posted in the third quarter of last year. But GM's sales growth in China has been solid this year, keeping pace with -- and sometimes outpacing -- the overall market's growth. What's the deal?

The deal is that problems in other parts of Asia might be starting to catch up with GM, and that may dent the automaker's profits for a while. In this video, Motley Fool contributor John Rosevear goes under the hood to take a closer look at what's going on with GM in Asia, and offers his view on whether the company's China boom could be headed for a bust.

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Fool contributor John Rosevear owns shares of General Motors. You can connect with him on Twitter at @jrosevear. The Motley Fool recommends General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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