The company earned $2.66 per share, exceeding analysts estimates of $2.56 per share, according to First Call Corp.

In the strike-impacted quarter last year, the automaker earned $306 million or $0.40 per share when walkouts at two Michigan parts plants nearly halted North American production.

All figures exclude Delphi Automotive Systems Corp., which GM spun off as an independent company in May.

GM President G Richard Wagoner said he is seeing momentum build in the United States, where market share topped the key 30 per cent level in June."The North American market is red hot and brutally competitive," he said. "But the results show that our focus on cost reduction and success in the marketplace lead to continued strong financial results."

GMsaid its worldwide revenues in the second quarter totalled $45.1 billion, compared with $37.3 billion for the second quarter last year.

GM shares were up 81 cents at $69.125 in early trade on the New York Stock Exchange.

Second-quarter earnings this year were negatively impacted by a $125 million pretax charge at GM's Hughes Electronics Corp unit related to development costs and schedule delays at its satellite division.

Earnings from GM's North American auto operations climbed to $1.473 billion versus a loss of $194 million in the second quarter last year. The North American auto operations lost $890 million in the second quarter last year from the strikes.

David Healy, an analyst with Burnham Securities, said high US consumer incentives on new cars and trucks kept GM from earning even more. "I thought that incentives would be down from a year ago, but I guess they weren't."A sharp drop in worldwide pension expenses also helped the bottomline, he added.

In Europe, where GM's market share climbed to10 per cent from 9.2 per cent a year ago, automotive net earnings rose to $187 million from $124 million in the previous second quarter. European auto results last year include an unfavourable $44 million after-tax charge from work schedule changes at a plant in Belgium. In the Latin American, Middle East and Africa region, hit by an economic slowdown, GM lost $38 million versus a profit of $48 million in the year-ago quarter.