UPDATE 1-GM profit tops estimates but U.S. strike weighs on outlook

Nick Carey and Ben Klayman

DETROIT, Oct 29 (Reuters) - General Motors Co on Tuesday posted a better-than-expected quarterly net profit thanks to robust U.S. sales of high-margin pickup trucks and SUVs, but slashed its full-year earnings forecast citing the impact of a 40-day U.S. labor strike.

Last Friday, the 48,000 United Auto Workers union members at GM ratified a new four-year labor deal with the Detroit company. The 40-day strike cost GM more than $2 billion according to analysts.

The Detroit-based automaker reported a 6% increase in third-quarter U.S. sales, led by its highly-profitable full-size pickup trucks, SUVs and crossovers.

Virtually all of the pre-tax profits came from its North American business and its captive finance arm.

In China, where GM reported a 17.5% drop in third-quarter sales, the company's equity income fell 40% to $300 million.

Last week, GM's smaller U.S. rival, Ford Motor Co, cut its forecast for operating profit for the year after a disappointing quarter hurt by higher warranty costs, bigger discounts and weaker-than-expected performance in China.

GM said the strike by the UAW, which had brought its North American operations to a virtual standstill, had cost it $1 billion on pre-tax profits in the quarter, or 52 cents per share.

The No. 1 U.S. automaker said the full-year impact of the strike would be around $2 per share.

GM said it now expected full-year adjusted earnings per share between $4.50 to $4.80, down from its previous forecast of $6.50 to $7 per share.

The automaker posted net income in the third quarter of $2.3 billion, or $1.60 a share, down from $2.5 billion, or $1.75 a share, a year earlier. Excluding one-time items, GM earned $1.72 a share. Analysts had expected $1.31, on average, according to IBES data from Refinitiv. Revenue fell slightly to $35.47 billion from $35.79 billion, above analysts' estimates of $33.82 billion.

(Reporting By Nick Carey)