The world's largest car maker, General Motors, has reported a 74% drop in second quarter profits, including restructuring charges.

Lower US vehicle sales and losses from overseas operations were to blame for the fall.

Profits from GM's core North American vehicle business were more than halved to $521m, compared to $1.41bn in the second quarter a year ago.

The slowing economy seems to have had a negative impact on the number of Americans buying new cars, with sales down 12%.

But the company has also been implementing measures to compensate for dwindling demand, by taking steps to cut its US production by 13% and stopping an excessive build-up of stocks.

Trouble overseas

GM's operations outside of the US racked up losses of $111m.

And these losses exclude the $133m charge for the restructuring of its Japanese affiliate Isuzu Motors.

The European business performed worst of all, losing $154m in the second quarter compared to a profit of $166m during the same three months a year earlier.

This was only partially offset by profits in Asia-Pacific, Latin America and the Middle East.

Better than expected

Despite the dramatic decline, the results were at the top end of analysts' expectations.

The car maker had reported an even steeper year-on-year decline in profits during the first three months of the year.

The company management also indicated that the results were considered to be healthy in the context of tough market conditions.

"We had a reasonably solid quarter considering lower North American production and the prevailing tough pricing conditions," said chairman Jack Smith.

The company reiterated that it expects to meet its full-year earnings target.