General Motors Corp. posted on Wednesday a big third-quarter lost, of $38.96 billion due to tax credits and GMAC, its former finance subsidiary. The largest U.S. auto maker reported a loss of $38.96 billion, or $68.85 a share, in comparison with the loss of $147 million, or 26 cents a share from last year.

Excluding items GM announced a lost of $1.6 billion or $2.80 a share, from the income of $497 million, or 88 cents a share, from 2006.

GM Chairman and Chief Executive Rick Wagoner said: “We continue to implement the key elements of our North America turnaround strategy, and these initiatives are driving steady improvement in our financial results, despite challenging North America market conditions,” the Wall Street Journal reports.

Company’s revenue fell from $48.9 billion from last year to $43.8 billion.

General Motor’s shares dropped 7% to $34.35 in premarket trading. The company lost 20 percent at stock from October when GM closed a deal with the United Auto Workers union.

Before the results of the third quarter GM said it will book $38.6 billion noncash in order to write down deferred-tax-credits. Announced late Tuesday, the write down is due to losses in North American operations and Germany in the last three years and a weakness at GMAC.

Wall Street analysts forecast a quarterly lost of 36 cents per share.

The downfall reflects losses at the North American and European operations according to GM Chief Financial Officer Fritz Henderson.

Henderson says that the U.S. housing market is to blame for the weak sale in the auto industry, which are to record their lowest annual total in 10 years with 16 million units.

Although it has success in Asia Pacific and Latin America, GM recorded losses from operations in North America, of $247 million and in Europe of $90 million.

Globally its auto operations made a progress in the third quarter.

Net income from continuing operations was recorded at $122 million.