General Motors Corp. reported a third-quarter net loss of $368 million on Thursday, reflecting the sharp fall in U.S. vehicle sales and the costs of cheap loans to customers. 

GM, the world's largest automaker, said its quarterly earnings, including charges totaling $753 million or $1.26 per share, fell to a loss of 41 cents per share, from a profit of $829 million, or $1.55 per share, a year earlier. 

Excluding the charges, GM's earnings fell to 85 cents per share. GM reaffirmed its third-quarter earnings forecast, excluding the charges, of 83 cents per share on Sept. 17, just days after the hijacked plane attacks on New York and Washington disrupted the U.S. economy. 

The results beat Wall Street forecasts before charges of 80 cents per share, with a range of 55 to 86 cents, according to research firm Thomson Financial/First Call. 

However, GM warned that it expects weaker fourth-quarter earnings than Wall Street had expected, due to pricing pressures on sales to rental agencies. GM said it expects to earn 50 cents per share in the fourth quarter, down from analysts' estimates of 71 cents per share, according to First Call/Thomson Financial. Since the Sept. 11 air attacks, rental car agencies have cut their fleets, forcing down the prices that GM realizes from sales to the companies. 

``There is considerable uncertainty regarding the strength of the key automotive markets during the balance of the year and in 2002,'' GM Chief Executive Officer Rick Wagoner said in a statement. ``We're buckling down to enhance our cost position while remaining very aggressive in our effort to maximize revenue and grow market share.'' 

Shares of Detroit-based GM closed on Wednesday at $42.77 on the New York Stock Exchange. GM shares have outperformed their closest rival, Ford Motor Co., by around 15 percent since the beginning of the year. 

Unlike Ford, GM managed to post a profit before charges in the third quarter, aided by its new lineup of highly profitable, mid-sized sport utility vehicles, such as the Chevrolet TrailBlazer, GMC Envoy and Oldsmobile Bravada. Excluding the charges, GM reported a profit in the third quarter of $385 million. 

Ford reported a loss of $502 million before charges, or a net loss of $692 million, only the second consecutive quarterly loss since the second half of 1992. Ford's earnings were hurt by costs associated with the Firestone tire recall, falling sales, and sharply higher incentives on sales of new cars and trucks. 

DaimlerChrysler AG is scheduled to report its third-quarter earnings next Tuesday. Its U.S. Chrysler group unit is expected to post an operating loss of 586 million euros ($530 million), according to a Reuters poll of 12 analysts. 

Like Ford and Chrysler, GM was also hit by the slowing U.S. economy and soaring consumer incentives. Profits from its core North American automotive operations fell to $445 million from $728 million in the third quarter of 2000. 

GM blamed the weaker earnings partly on a 6.2 percent third-quarter cut in new vehicle production in its key North American market. 

Rather than trim production further after the Sept. 11 attacks, the automaker added customer incentives, including zero- or low-interest financing rates, to try to keep sales moving. GM said it booked most of the costs of its ``Keep America Rolling'' incentive plan in the third quarter, although officials insisted they would not be significant. 

``GM North America finished the quarter with particularly strong vehicle sales,'' Wagoner said. ``U.S. market share was up in the third quarter, driven by strong sales of our full-size trucks, utilities, and new entries ...'' 

GM's revenues fell to $42.5 billion from $42.7 billion in the same quarter a year ago. 

GM said its amount of cash, marketable securities and retiree benefit funds fell about $100 million to $11.0 billion at the end of the third quarter. 

Wall Street closely watches automakers' cash levels to make sure they have enough to weather a downturn. Ford surprised the street when it said this week that it burned through $3.7 billion of cash during the third quarter.