General Motors, the world's largest car maker, has issued an upbeat trading forecast, saying its earnings will beat previous forecasts.

The company also said it would be attempting to grow its market share.

"We will pursue growth in (market) share, while at the same time attempting to maximize profits," said GM Vice Chairman Bob Lutz.

Earlier this week, GM said it was planning to cut about 5,000 jobs in the US through natural wastage and by offering early retirement to some of its salaried workers.

On Friday, GM's rival Ford is expected to announce four times as many job cuts.

'Challenging' year ahead

"Overall, 2002 will be a very challenging year for the industry," said GM's Chief Financial Officer John Devine said in a statement.

"At GM, we are determined to continue building momentum."

GM saw its market share in the US rise during 2001 for the first time in many years.

Along with the other main US car makers, GM went all out to maintain sales levels in the wake of the 11 September terror attacks.

The car maker saw sales rise to near record levels after offering zero-financing deals on most of its cars and trucks, and it has continued to offer generous deals to buyers.

Strong sales in North America have enabled GM to raise its forecast for fourth-quarter earnings from 50 cents a share to 60 cents - which was better than analysts' expectations.

It is now forecasting earnings of $3 a share for 2002, against analyst forecast of about $1.93.

Peso devaluation hits earnings

GM said its fourth-quarter earnings' forecast would have been even higher but for Argentina's decision to devalue the peso. GM has one assembly plant in the country.

"Improved profits generated by strong North American vehicle sales will be partially offset by the unfavourable effect of the currency devaluation in Argentina," said Mr Devine.

The devaluation is expected to cost GM about 10 cents a share.

Despite the generally upbeat message from GM, on Wall Street its shares closed down 17 cents at $50.07.