GM Closing In On IPO

November is an important month for General Motors, as the company prepares to release its third quarter earnings report, and gets ready to put its stock on the market again.

"They're getting their balance sheet clean by paying back a lot of their debt. They're getting things ready for the IPO," said HIS Automotive analyst Aaron Bragman. "We're going to be seeing them set a stock price hopefully in the next couple of weeks."

GM made money in the first and second quarters, and is expected to release third quarter earning that have been described as "significant." The company hasn't set a date for its earnings report yet. But, it's expected to come this week.

Shortly after that, top GM executives will embark on a "road show" to sell the stock to large investors, many of whom may be skeptical about the company's prospects for future growth.

"A lot of these people, that they are going to be trying to selling the stock to, are the ones who saw all of their value wiped out when GM declared bankruptcy," said Bragman, in an interview with WWJ AutoBeat Reporter Jeff Gilbert. "So, they really have to prove that it's a different company, it's a different game, and they have much better prospects."

However, Bragman said General Motors can point to the return to profitability in the auto industry overall, and strong sales of the company's new products.

"There's really no problem in this industry that good product can't solve," he said. "GM is actually starting to realize that with some of the new product that's coming out, that's already been seeing success. The Chevy Equinox, which they can not build enough of, has really proven to a lot of people that product is finally where it needs to be."

General Motors has not commented on plans for its initial public offering of stock, which will be the start of the government's sale of its 51 per cent stake in the company.

It's been widely reported that the IPO will be launched the week before Thanksgiving. GM will set a share price shortly before that launch. Analyst expect a share of stock in the new GM to run in the $20 - $25 dollar range, but GM executives will not publicly discuss any aspects of the IPO.

(Copyright 2010 WWJ Radio.  All Rights Reserved.)

WWJ AutoBeat Reporter Jeff Gilbert contributed to this story.