GENERAL MOTORS
2019 ANNUAL REPORT
2019 ANNUAL REPORT
(cid:55)(cid:68)(cid:69)(cid:79)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:38)(cid:82)(cid:81)(cid:87)(cid:72)(cid:81)(cid:87)(cid:86)(cid:3)
Table of Contents
(cid:3)
(cid:44)(cid:17)(cid:3) (cid:51)(cid:72)(cid:85)(cid:73)(cid:82)(cid:85)(cid:80)(cid:68)(cid:81)(cid:70)(cid:72)(cid:3)(cid:42)(cid:85)(cid:68)(cid:83)(cid:75)(cid:3)
I. Performance Graph
(cid:3)
(cid:44)(cid:44)(cid:17)(cid:3) (cid:36)(cid:81)(cid:81)(cid:88)(cid:68)(cid:79)(cid:3)(cid:53)(cid:72)(cid:83)(cid:82)(cid:85)(cid:87)(cid:3)(cid:82)(cid:81)(cid:3)(cid:41)(cid:82)(cid:85)(cid:80)(cid:3)(cid:20)(cid:19)(cid:16)(cid:46)(cid:3)
II. Annual Report on Form 10-K
(cid:3)
(cid:3)
(cid:51)(cid:68)(cid:85)(cid:87)(cid:3)(cid:44)(cid:29)(cid:3)(cid:3)(cid:3)
Part I:
(cid:51)(cid:72)(cid:85)(cid:73)(cid:82)(cid:85)(cid:80)(cid:68)(cid:81)(cid:70)(cid:72)(cid:3)(cid:42)(cid:85)(cid:68)(cid:83)(cid:75)(cid:3)
Performance Graph
(cid:100)(cid:346)(cid:286)(cid:3) (cid:296)(cid:381)(cid:367)(cid:367)(cid:381)(cid:449)(cid:349)(cid:374)(cid:336)(cid:3) (cid:393)(cid:286)(cid:396)(cid:296)(cid:381)(cid:396)(cid:373)(cid:258)(cid:374)(cid:272)(cid:286)(cid:3) (cid:336)(cid:396)(cid:258)(cid:393)(cid:346)(cid:3) (cid:272)(cid:381)(cid:373)(cid:393)(cid:258)(cid:396)(cid:286)(cid:400)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:393)(cid:286)(cid:396)(cid:296)(cid:381)(cid:396)(cid:373)(cid:258)(cid:374)(cid:272)(cid:286)(cid:3) (cid:381)(cid:296)(cid:3) (cid:39)(cid:286)(cid:374)(cid:286)(cid:396)(cid:258)(cid:367)(cid:3) (cid:68)(cid:381)(cid:410)(cid:381)(cid:396)(cid:400)(cid:3) (cid:18)(cid:381)(cid:373)(cid:393)(cid:258)(cid:374)(cid:455)(cid:859)(cid:400)(cid:3) (cid:272)(cid:381)(cid:373)(cid:373)(cid:381)(cid:374)(cid:3)
The following performance graph compares the performance of General Motors Company's common
(cid:400)(cid:346)(cid:258)(cid:396)(cid:286)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:94)(cid:410)(cid:258)(cid:374)(cid:282)(cid:258)(cid:396)(cid:282)(cid:3)(cid:920)(cid:3)(cid:87)(cid:381)(cid:381)(cid:396)(cid:859)(cid:400)(cid:3)(cid:1009)(cid:1004)(cid:1004)(cid:3)(cid:94)(cid:410)(cid:381)(cid:272)(cid:364)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:24)(cid:381)(cid:449)(cid:3)(cid:58)(cid:381)(cid:374)(cid:286)(cid:400)(cid:3)(cid:4)(cid:437)(cid:410)(cid:381)(cid:373)(cid:381)(cid:271)(cid:349)(cid:367)(cid:286)(cid:3)(cid:920)(cid:3)(cid:87)(cid:258)(cid:396)(cid:410)(cid:400)(cid:3)(cid:100)(cid:349)(cid:410)(cid:258)(cid:374)(cid:3)(cid:1007)(cid:1004)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)(cid:3)
shares to the Standard & Poor's 500 Stock Index and the Dow Jones Automobile & Parts Titan 30 Index
(cid:296)(cid:381)(cid:396)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:367)(cid:258)(cid:400)(cid:410)(cid:3) (cid:296)(cid:349)(cid:448)(cid:286)(cid:3) (cid:455)(cid:286)(cid:258)(cid:396)(cid:400)(cid:856)(cid:3) (cid:47)(cid:410)(cid:3) (cid:258)(cid:400)(cid:400)(cid:437)(cid:373)(cid:286)(cid:400)(cid:3) (cid:936)(cid:1005)(cid:1004)(cid:1004)(cid:3) (cid:449)(cid:258)(cid:400)(cid:3) (cid:349)(cid:374)(cid:448)(cid:286)(cid:400)(cid:410)(cid:286)(cid:282)(cid:3) (cid:381)(cid:374)(cid:3) (cid:24)(cid:286)(cid:272)(cid:286)(cid:373)(cid:271)(cid:286)(cid:396)(cid:3) (cid:1007)(cid:1005)(cid:853)(cid:3) (cid:1006)(cid:1004)(cid:1005)(cid:1008)(cid:853)(cid:3) (cid:449)(cid:349)(cid:410)(cid:346)(cid:3) (cid:282)(cid:349)(cid:448)(cid:349)(cid:282)(cid:286)(cid:374)(cid:282)(cid:400)(cid:3) (cid:271)(cid:286)(cid:349)(cid:374)(cid:336)(cid:3)
for the last five years. It assumes $100 was invested on December 31, 2014, with dividends being
(cid:396)(cid:286)(cid:349)(cid:374)(cid:448)(cid:286)(cid:400)(cid:410)(cid:286)(cid:282)(cid:856)(cid:3)
reinvested.
(cid:87)(cid:286)(cid:396)(cid:296)(cid:381)(cid:396)(cid:373)(cid:258)(cid:374)(cid:272)(cid:286)(cid:3)(cid:39)(cid:396)(cid:258)(cid:393)(cid:346)(cid:855)(cid:3)
Performance Graph:
(cid:3)(cid:936)(cid:1006)(cid:1004)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$200.C1
(cid:3)(cid:936)(cid:1005)(cid:1012)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$180.00
(cid:3)(cid:936)(cid:1005)(cid:1010)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$160.00
(cid:3)(cid:936)(cid:1005)(cid:1008)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$140.00
(cid:3)(cid:936)(cid:1005)(cid:1006)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$120.00
(cid:3)(cid:936)(cid:1005)(cid:1004)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$100.00
(cid:3)(cid:936)(cid:1012)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$80.00
(cid:3)(cid:936)(cid:1010)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$60.00
(cid:3)(cid:936)(cid:1008)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$40.00
(cid:3)(cid:936)(cid:1006)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$20.00
(cid:3)(cid:936)(cid:882)
$-
(cid:1006)(cid:1004)(cid:1005)(cid:1008)
(cid:1006)(cid:1004)(cid:1005)(cid:1013)
2014 2015 2016 2017 2018 2019
(cid:1006)(cid:1004)(cid:1005)(cid:1012)
(cid:1006)(cid:1004)(cid:1005)(cid:1009)
(cid:1006)(cid:1004)(cid:1005)(cid:1010)
(cid:1006)(cid:1004)(cid:1005)(cid:1011)
(cid:39)(cid:286)(cid:374)(cid:286)(cid:396)(cid:258)(cid:367)(cid:3)(cid:68)(cid:381)(cid:410)(cid:381)(cid:396)(cid:400)(cid:3)(cid:18)(cid:381)(cid:373)(cid:393)(cid:258)(cid:374)(cid:455)
General Motors Company
(cid:94)(cid:920)(cid:87)(cid:3)(cid:1009)(cid:1004)(cid:1004)(cid:3)(cid:94)(cid:410)(cid:381)(cid:272)(cid:364)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)
,S&P 500 Stock Index
(cid:24)(cid:381)(cid:449)(cid:3)(cid:58)(cid:381)(cid:374)(cid:286)(cid:400)(cid:3)(cid:4)(cid:437)(cid:410)(cid:381)(cid:373)(cid:381)(cid:271)(cid:349)(cid:367)(cid:286)(cid:3)(cid:920)(cid:3)(cid:87)(cid:258)(cid:396)(cid:410)(cid:400)(cid:3)(cid:100)(cid:349)(cid:410)(cid:258)(cid:374)(cid:400)(cid:3)(cid:1007)(cid:1004)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)
Dow Jones Automobile & Parts Titans 30 Index
(cid:3)
(cid:3)
(cid:24)(cid:258)(cid:410)(cid:258)(cid:3)(cid:87)(cid:381)(cid:349)(cid:374)(cid:410)(cid:400)(cid:3)(cid:349)(cid:374)(cid:3)(cid:24)(cid:381)(cid:367)(cid:367)(cid:258)(cid:396)(cid:400)(cid:855)(cid:3)
Data Points in Dollars:
(cid:3)
(cid:1006)(cid:1004)(cid:1005)(cid:1008)(cid:3)
(cid:3)
2014
(cid:936)(cid:1005)(cid:1004)(cid:1004)(cid:856)(cid:1004)(cid:1004)
(cid:39)(cid:286)(cid:374)(cid:286)(cid:396)(cid:258)(cid:367)(cid:3)(cid:68)(cid:381)(cid:410)(cid:381)(cid:396)(cid:400)(cid:3)(cid:18)(cid:381)(cid:373)(cid:393)(cid:258)(cid:374)(cid:455)(cid:3)
$100.00
General Motors Company
(cid:94)(cid:920)(cid:87)(cid:3)(cid:1009)(cid:1004)(cid:1004)(cid:3)(cid:94)(cid:410)(cid:381)(cid:272)(cid:364)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)(cid:3)
(cid:936)(cid:1005)(cid:1004)(cid:1004)(cid:856)(cid:1004)(cid:1004)
$100.00
S&P 500 Stock Index
(cid:936)(cid:1005)(cid:1004)(cid:1004)(cid:856)(cid:1004)(cid:1004)
(cid:24)(cid:381)(cid:449)(cid:3)(cid:58)(cid:381)(cid:374)(cid:286)(cid:400)(cid:3)(cid:4)(cid:437)(cid:410)(cid:381)(cid:373)(cid:381)(cid:271)(cid:349)(cid:367)(cid:286)(cid:3)(cid:920)(cid:3)(cid:87)(cid:258)(cid:396)(cid:410)(cid:400)(cid:3)(cid:100)(cid:349)(cid:410)(cid:258)(cid:374)(cid:400)(cid:3)(cid:1007)(cid:1004)(cid:3)(cid:47)(cid:374)(cid:282)(cid:286)(cid:454)
DowJones Automobile & Parts Titans 30 Index $100.00
(cid:122)(cid:286)(cid:258)(cid:396)(cid:3)(cid:286)(cid:374)(cid:282)(cid:286)(cid:282)(cid:3)(cid:24)(cid:286)(cid:272)(cid:286)(cid:373)(cid:271)(cid:286)(cid:396)(cid:3)(cid:1007)(cid:1005)(cid:3)
Year ended December 31
(cid:1006)(cid:1004)(cid:1005)(cid:1009)(cid:3)
2015
(cid:936)(cid:1005)(cid:1004)(cid:1005)(cid:856)(cid:1008)(cid:1008)
$101.44
(cid:936)(cid:1005)(cid:1004)(cid:1005)(cid:856)(cid:1007)(cid:1012)
$101.38
(cid:936)(cid:1013)(cid:1013)(cid:856)(cid:1007)(cid:1006)
$99.32
(cid:1006)(cid:1004)(cid:1005)(cid:1010)(cid:3)
2016
(cid:936)(cid:1005)(cid:1004)(cid:1012)(cid:856)(cid:1013)(cid:1008)
$108.94
(cid:936)(cid:1005)(cid:1005)(cid:1007)(cid:856)(cid:1009)(cid:1005)
$113.51
(cid:936)(cid:1013)(cid:1011)(cid:856)(cid:1004)(cid:1009)
$97.05
(cid:1006)(cid:1004)(cid:1005)(cid:1013)(cid:3)
(cid:1006)(cid:1004)(cid:1005)(cid:1011)(cid:3)
(cid:1006)(cid:1004)(cid:1005)(cid:1012)(cid:3)
2019
2018
2017
(cid:936)(cid:1005)(cid:1007)(cid:1007)(cid:856)(cid:1008)(cid:1011)(cid:3) (cid:936)(cid:1005)(cid:1005)(cid:1007)(cid:856)(cid:1009)(cid:1009)(cid:3) (cid:936)(cid:1005)(cid:1006)(cid:1013)(cid:856)(cid:1008)(cid:1007)
$129.43
$113.55
$133.47
(cid:936)(cid:1005)(cid:1007)(cid:1012)(cid:856)(cid:1006)(cid:1013)(cid:3) (cid:936)(cid:1005)(cid:1007)(cid:1006)(cid:856)(cid:1006)(cid:1007)(cid:3) (cid:936)(cid:1005)(cid:1011)(cid:1007)(cid:856)(cid:1012)(cid:1010)
$173.86
$132.23
$138.29
(cid:936)(cid:1005)(cid:1004)(cid:1009)(cid:856)(cid:1006)(cid:1013)
(cid:936)(cid:1013)(cid:1006)(cid:856)(cid:1008)(cid:1005)(cid:3)
(cid:936)(cid:1005)(cid:1005)(cid:1011)(cid:856)(cid:1010)(cid:1008)(cid:3)
$105.29
$92.41
$117.64
(cid:3)
(cid:3)
(cid:3)
(cid:51)(cid:68)(cid:85)(cid:87)(cid:3)(cid:44)(cid:44)(cid:29)(cid:3)
Part Il:
(cid:36)(cid:81)(cid:81)(cid:88)(cid:68)(cid:79)(cid:3)(cid:53)(cid:72)(cid:83)(cid:82)(cid:85)(cid:87)(cid:3)(cid:82)(cid:81)(cid:3)(cid:41)(cid:82)(cid:85)(cid:80)(cid:3)(cid:20)(cid:19)(cid:16)(cid:46)(cid:3)(cid:3)
Annual Report on Form 10-K
(cid:73)(cid:82)(cid:85)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:92)(cid:72)(cid:68)(cid:85)(cid:3)(cid:72)(cid:81)(cid:71)(cid:72)(cid:71)(cid:3)(cid:39)(cid:72)(cid:70)(cid:72)(cid:80)(cid:69)(cid:72)(cid:85)(cid:3)(cid:22)(cid:20)(cid:15)(cid:3)(cid:21)(cid:19)(cid:20)(cid:28)(cid:3)
for the year ended December 31, 2019
(cid:3)
(cid:3)
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549-1004
Washington, DC 20549-1004
Form 10-K
Form 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2019
For the fiscal year ended December 31, 2019
OR
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
1934
For the transition period from to
For the transition period from to
Commission file number 001-34960
Commission file number 001-34960
GENERAL MOTORS COMPANY
GENERAL MOTORS COMPANY
(Exact name of registrant as specified in its charter)
(Exact name of registrant as specified in its charter)
Delaware
27-0756180
Delaware 27-0756180
(State or other jurisdiction of
(State or other jurisdiction of
incorporation or organization)
incorporation or organization)
300 Renaissance Center, Detroit, Michigan
300 Renaissance Center, Detroit, Michigan
(Address of principal executive offices)
(Address of principal executive offices)
(I.R.S. Employer
(I.R.S. Employer
Identification No.)
Identification No.)
48265 -3000
48265 -3000
(Zip Code)
(Zip Code)
(313) 667-1500
(313) 667-1500
(Registrant’s telephone number, including area code)
(Registrant's telephone number, including area code)
Not applicable
Not applicable
(Former name, former address and former fiscal year, if changed since last report)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Title of each class
Common Stock, $0.01 par value
Common Stock, $0.01 par value
Trading Symbol(s)
( )
g y
Trading Symbol(s)
GM
GM
Name of each exchange on which registered
g
Name of each exchange on which registered
New York Stock Exchange
New York Stock Exchange
g
Securities registered pursuant to Section 12 (g) of the Act: None
Securities registered pursuant to Section 12 (g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes 0 No 10
No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes YY
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes O No 0
No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been
No
subject to such filing requirements for the past 90 days. Yes
subject to such filing requirements for the past 90 days. Yes 0 No
uu
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to
Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required
Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required
No
to submit such files). Yes
to submit such files). Yes 0 No
d
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and
company or an emerging growth company. See the defmitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and
"emerging growth company" in Rule 12b-2 of the Exchange Act.
"emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ga Accelerated filer D Non-accelerated filer Smaller reporting company EI Emerging growth company 13
Large accelerated filer
Smaller reporting company
Emerging growth company
Non-accelerated filer
Accelerated filer
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
ff
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 0
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes D No 21
No N
The aggregate market value of the voting stock held by non-affiliates of the registrant (assuming only for purposes of this computation that
The aggregate market value of the voting stock held by non-affiliates of the registrant (assuming only for purposes of this computation that
m
directors and executive officers may be affiliates) was approximately $54.7 billion as of June 30, 2019.
directors and executive officers may be affiliates) was approximately $54.7 billion as of June 30, 2019.
As of January 24, 2020 there were 1,429,002,063 shares of common stock outstanding.
As of January 24,2020 there were 1,429,002,063 shares of common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's definitive Proxy Statement related to the Annual Stockholders Meeting to be filed subsequently are incorporated
Portions of the registrant's definitive Proxy Statement related to the Annual Stockholders Meeting to be filed subsequently are incorporated
by reference into Part III of this Form 10-K.
by reference into Part III of this Form 10-K.
INDEX
INDEX
Page
Page
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART I
PART I
Item 1.
Item 1. Business 1
1
Item 1A.
Item 1A. Risk Factors 10
10
Item 1B. Unresolved Staff Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1B. Unresolved Staff Comments 17
17
Item 2.
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 2. Properties 17
17
Item 3.
Item 3. Legal Proceedings 17
17
Item 4.
Item 4. Mine Safety Disclosures 17
17
PART II
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Management’s Discussion and Analysis of Financial Condition and Results of Operations. . . . . . . . . . . . . . .
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Securities 18
18
Item 6.
Item 6. Selected Financial Data 19
19
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 19
19
Item 7A. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 39
39
Item 8.
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 8. Financial Statements and Supplementary Data 47
47
Consolidated Income Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Income Statements 47
47
Consolidated Statements of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Comprehensive Income 47
47
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheets 48
48
Consolidated Statements of Cash Flows. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Cash Flows 49
49
Consolidated Statements of Equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Equity 50
50
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes to Consolidated Financial Statements 51
51
Note 1. Nature of Operations and Basis of Presentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 1. Nature of Operations and Basis of Presentation 51
51
Note 2.
Note 2. Significant Accounting Policies 51
51
Significant Accounting Policies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 3. Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 3. Revenue 58
58
Note 4. Marketable and Other Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 4. Marketable and Other Securities 60
60
Note 5. GM Financial Receivables and Transactions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 5. GM Financial Receivables and Transactions 61
61
Note 6.
Note 6. Inventories 63
63
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 7. Equipment on Operating Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 7. Equipment on Operating Leases 63
63
Note 8. Equity in Net Assets of Nonconsolidated Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 8. Equity in Net Assets of Nonconsolidated Affiliates 63
63
Note 9.
Note 9. Property 66
66
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 10. Goodwill and Intangible Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 10. Goodwill and Intangible Assets 66
66
Note 11. Variable Interest Entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 11. Variable Interest Entities 67
67
Note 12. Accrued and Other Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 12. Accrued and Other Liabilities 67
67
Note 13. Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 13. Debt 68
68
Note 14. Derivative Financial Instruments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 14. Derivative Financial Instruments 70
70
Note 15. Pensions and Other Postretirement Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 15. Pensions and Other Postretirement Benefits 71
71
Note 16. Commitments and Contingencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 16. Commitments and Contingencies 77
77
Note 17. Income Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 17_ Income Taxes 82
82
Note 18. Restructuring and Other Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 18. Restructuring and Other Initiatives 84
84
Note 19. Interest Income and Other Non-Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 19. Interest Income and Other Non-Operating Income 85
85
Note 20. Stockholders’ Equity and Noncontrolling Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 20. Stockholders' Equity and Noncontrolling Interests 86
86
Note 21. Earnings Per Share. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 21. Earnings Per Share 88
88
Note 22. Discontinued Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88
Note 22. Discontinued Operations 88
Note 23. Stock Incentive Plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 23. Stock Incentive Plans 89
89
Note 24. Supplementary Quarterly Financial Information (Unaudited). . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 24. Supplementary Quarterly Financial Information (Unaudited) 91
91
Note 25. Segment Reporting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note 25. Segment Reporting 91
91
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Page
Page
Note 26. Supplemental Information for the Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . .
Note 26. Supplemental Information for the Consolidated Statements of Cash Flows 94
94
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. . . . . . . . . . . . . . .
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 95
95
Item 9A.
Item 9A. Controls and Procedures 95
95
Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 9B. Other Information 96
96
PART III
PART LII
Item 10.
Item 10. Directors, Executive Officers and Corporate Governance 96
96
Item 11.
Item 11. Executive Compensation 96
96
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 96
96
Item 13.
Item 13. Certain Relationships and Related Transactions, and Director Independence 96
96
Item 14.
Item 14. Principal Accounting Fees and Services 96
96
PART IV
PART IV
Item 15.
Item 15. Exhibits 96
96
Item 16.
Form 10-K Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 16. Form 10-K Summary 99
99
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Signatures 100
100
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . . . . .
Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain Relationships and Related Transactions, and Director Independence . . . . . . . . . . . . . . . . . . . . . . . . . .
Principal Accounting Fees and Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
PART I
PART I
Item 1. Business
Item 1. Business
General Motors Company (sometimes referred to as we, our, us, ourselves, the Company, General Motors, or GM) was
General Motors Company (sometimes referred to as we, our, us, ourselves, the Company, General Motors, or GM) was
incorporated as a Delaware corporation in 2009. We design, build and sell trucks, crossovers, cars and automobile parts worldwide.
incorporated as a Delaware corporation in 2009. We design, build and sell trucks, crossovers, cars and automobile parts worldwide.
Cruise, formerly GM Cruise, is our global segment responsible for the development and commercialization of autonomous vehicle
Cruise, formerly GM Cruise, is our global segment responsible for the development and commercialization of autonomous vehicle
technology. We also provide automotive financing services through General Motors Financial Company, Inc. (GM Financial).
technology. We also provide automotive fmancing services through General Motors Financial Company, Inc. (GM Financial).
Except for per share amounts or as otherwise specified, amounts presented within tables are stated in millions.
Except for per share amounts or as otherwise specified, amounts presented within tables are stated in millions.
On July 31, 2017 we closed the sale of the Opel and Vauxhall businesses and certain other assets in Europe (the Opel/Vauxhall
On July 31, 2017 we closed the sale of the Opel and Vauxhall businesses and certain other assets in Europe (the Opel/Vauxhall
Business) to Peugeot, S.A. (PSA Group). On October 31, 2017 we closed the sale of the European financing subsidiaries and
Business) to Peugeot, S.A. (PSA Group). On October 31, 2017 we closed the sale of the European fmancing subsidiaries and
branches (the Fincos, and together with the Opel/Vauxhall Business, the European Business) to Banque PSA Finance S.A. and
branches (the Fincos, and together with the Opel/Vauxhall Business, the European Business) to Banque PSA Finance S.A. and
BNP Paribas Personal Finance S.A. The European Business is presented as discontinued operations in our consolidated financial
BNP Paribas Personal Finance S.A. The European Business is presented as discontinued operations in our consolidated fmancial
statements for all periods presented. Unless otherwise indicated, information in this report relates to our continuing operations.
statements for all periods presented. Unless otherwise indicated, information in this report relates to our continuing operations.
Automotive Our automotive operations meet the demands of our customers through our automotive segments: GM North America
Automotive Our automotive operations meet the demands of our customers through our automotive segments: GM North America
(GMNA) and GM International (GMI). GMNA meets the demands of customers in North America with vehicles developed,
(GMNA) and GM International (GMI). GMNA meets the demands of customers in North America with vehicles developed,
manufactured and/or marketed under the Buick, Cadillac, Chevrolet and GMC brands. GMI primarily meets the demands of
manufactured and/or marketed under the Buick, Cadillac, Chevrolet and GMC brands. GMI primarily meets the demands of
customers outside North America with vehicles developed, manufactured and/or marketed under the Buick, Cadillac, Chevrolet,
customers outside North America with vehicles developed, manufactured and/or marketed under the Buick, Cadillac, Chevrolet,
GMC and Holden brands. We also have equity ownership stakes in entities that meet the demands of customers in other countries,
GMC and Holden brands. We also have equity ownership stakes in entities that meet the demands of customers in other countries,
primarily in China, with vehicles developed, manufactured and/or marketed under the Baojun, Buick, Cadillac, Chevrolet and
primarily in China, with vehicles developed, manufactured and/or marketed under the Baojun, Buick, Cadillac, Chevrolet and
Wuling brands.
Wuling brands.
In addition to the vehicles we sell through our dealer network to retail customers, we also sell vehicles directly or through our
In addition to the vehicles we sell through our dealer network to retail customers, we also sell vehicles directly or through our
dealer network to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies and
dealer network to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies and
governments. Our customers can obtain a wide range of aftersale vehicle services and products through our dealer network, such
governments. Our customers can obtain a wide range of aftersale vehicle services and products through our dealer network, such
as maintenance, light repairs, collision repairs, vehicle accessories and extended service warranties.
as maintenance, light repairs, collision repairs, vehicle accessories and extended service warranties.
Competitive Position and Vehicle Sales The principal factors that determine consumer vehicle preferences in the markets in
Competitive Position and Vehicle Sales The principal factors that determine consumer vehicle preferences in the markets in
which we operate include overall vehicle design, price, quality, available options, safety, reliability, fuel economy and functionality.
which we operate include overall vehicle design, price, quality, available options, safety, reliability, fuel economy and functionality.
Market leadership in individual countries in which we compete varies widely.
Market leadership in individual countries in which we compete varies widely.
We present both wholesale and total vehicle sales data to assist in the analysis of our revenue and our market share. Wholesale
We present both wholesale and total vehicle sales data to assist in the analysis of our revenue and our market share. Wholesale
vehicle sales data consists of sales to GM's dealers and distributors as well as sales to the U.S. Government and excludes vehicles
vehicle sales data consists of sales to GM's dealers and distributors as well as sales to the U.S. Government and excludes vehicles
sold by our joint ventures. Wholesale vehicle sales data correlates to our revenue recognized from the sale of vehicles, which is
sold by our joint ventures. Wholesale vehicle sales data correlates to our revenue recognized from the sale of vehicles, which is
the largest component of Automotive net sales and revenue. In the year ended December 31, 2019, 34% of our wholesale vehicle
the largest component of Automotive net sales and revenue. In the year ended December 31, 2019, 34% of our wholesale vehicle
sales volume was generated outside the U.S. The following table summarizes wholesale vehicle sales by automotive segment
sales volume was generated outside the U.S. The following table summarizes wholesale vehicle sales by automotive segment
(vehicles in thousands):
(vehicles in thousands):
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
GMNA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GMNA 3,214
3,214
GMI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GMI 995
995
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total 4,209
4,209
76.4% 3,555
3,555
76.4%
23.6% 1,152
1,152
23.6%
100.0% 4,707
4,707
100.0%
75.5%
75.5%
24.5%
24.5%
100.0%
100.0%
Discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Discontinued operations
—
—
73.5%
73.5%
26.5%
26.5%
100.0%
100.0%
3,511
3,511
1,267
1,267
4,778
4,778
696
696
Total vehicle sales data represents: (1) retail sales (i.e., sales to consumers who purchase new vehicles from dealers or distributors);
Total vehicle sales data represents: (1) retail sales (i.e., sales to consumers who purchase new vehicles from dealers or distributors);
(2) fleet sales, such as sales to large and small businesses, governments, and daily rental car companies; and (3) vehicles used by
(2) fleet sales, such as sales to large and small businesses, governments, and daily rental car companies; and (3) vehicles used by
dealers in their businesses, including courtesy transportation vehicles. Total vehicle sales data includes all sales by joint ventures
dealers in their businesses, including courtesy transportation vehicles. Total vehicle sales data includes all sales by joint ventures
on a total vehicle basis, not based on our percentage ownership interest in the joint venture. Certain joint venture agreements in
on a total vehicle basis, not based on our percentage ownership interest in the joint venture. Certain joint venture agreements in
China allow for the contractual right to report vehicle sales of non-GM trademarked vehicles by those joint ventures, which are
China allow for the contractual right to report vehicle sales of non-GM trademarked vehicles by those joint ventures, which are
included in the total vehicle sales we report for China. While total vehicle sales data does not correlate directly to the revenue we
included in the total vehicle sales we report for China. While total vehicle sales data does not correlate directly to the revenue we
recognize during a particular period, we believe it is indicative of the underlying demand for our vehicles. Total vehicle sales data
recognize during a particular period, we believe it is indicative of the underlying demand for our vehicles. Total vehicle sales data
represents management's good faith estimate based on sales reported by GM's dealers, distributors, and joint ventures, commercially
represents management's good faith estimate based on sales reported by GM's dealers, distributors, and joint ventures, commercially
available data sources such as registration and insurance data, and internal estimates and forecasts when other data is not available.
available data sources such as registration and insurance data, and internal estimates and forecasts when other data is not available.
1
1
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table summarizes total industry vehicle sales and our related competitive position by geographic region (vehicles
The following table summarizes total industry vehicle sales and our related competitive position by geographic region (vehicles
in thousands):
in thousands):
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Industry
Industry
GM
GM
Market
Market
Share
Share
Industry
Industry
GM
GM
Market
Market
Share
Share
Industry
Industry
GM
GM
Market
Market
Share
Share
North America
North America
United States . . . . . . . . . . . . . . . . . . . 17,533
United States 17,533
3,642
Other . . . . . . . . . . . . . . . . . . . . . . . . .
Other 3,642
Total North America . . . . . . . . . . . . . 21,175
Total North America 21,175
Asia/Pacific, Middle East and
Asia/Pacific, Middle East and
Africa
Africa
China(a) . . . . . . . . . . . . . . . . . . . . . . . 25,398
China(a) 25,398
Other(b) . . . . . . . . . . . . . . . . . . . . . . . 21,503
Other(b) 21,503
Total Asia/Pacific, Middle East and
Total Asia/Pacific, Middle East and
Africa . . . . . . . . . . . . . . . . . . . . . . . 46,901
Africa 46,901
2,887
2,887
480
480
3,367
3,367
16.5% 17,721
16.5% 17,721
13.2% 3,839
3,839
13.2%
15.9% 21,560
15.9% 21,560
2,954
2,954
536
536
3,490
3,490
16.7% 17,570
16.7% 17,570
14.0% 3,980
3,980
14.0%
16.2% 21,550
16.2% 21,550
3,002
3,002
574
574
3,576
3,576
17.1%
17.1%
14.4%
14.4%
16.6%
16.6%
3,094
3,094
584
584
12.2% 26,519
12.2% 26,519
2.7% 22,258
2.7% 22,258
3,645
3,645
557
557
13.7% 28,231
13.7% 28,231
2.5% 21,288
2.5% 21,288
4,041
4,041
629
629
14.3%
14.3%
3.0%
3.0%
3,678
3,678
7.8% 48,777
7.8% 48,777
4,202
4,202
8.6% 49,519
8.6% 49,519
4,670
4,670
9.4%
9.4%
476
476
193
193
669
669
7,714
7,714
4
4
7,718
7,718
South America
South America
Brazil . . . . . . . . . . . . . . . . . . . . . . . . .
2,787
Brazil 2,787
Other . . . . . . . . . . . . . . . . . . . . . . . . .
1,531
Other 1,531
Total South America . . . . . . . . . . . . .
4,318
Total South America 4,318
Total in GM markets . . . . . . . . . . . . 72,394
Total in GM markets 72,394
Total Europe . . . . . . . . . . . . . . . . . . . 18,876
Total Europe 18,876
Total Worldwide(c) . . . . . . . . . . . . . 91,270
Total Worldwide(c) 91,270
United States
United States
Cars . . . . . . . . . . . . . . . . . . . . . . . . . .
Cars 4,842
4,842
Trucks(d) . . . . . . . . . . . . . . . . . . . . . .
Trucks(d) 4,496
4,496
Crossovers(d). . . . . . . . . . . . . . . . . . .
Crossovers(d) 8,195
8,195
Total United States . . . . . . . . . . . . . . 17,533
Total United States 17,533
China(a)
China(a)
SGMS . . . . . . . . . . . . . . . . . . . . . . . .
SGMS 1,482
1,482
SGMW. . . . . . . . . . . . . . . . . . . . . . . .
SGMW 1,612
1,612
Total China . . . . . . . . . . . . . . . . . . . . 25,398
Total China 25,398
3,094
3,094
389
389
1,332
1,332
1,166
1,166
2,887
2,887
17.1% 2,566
2,566
17.1%
12.6% 1,925
1,925
12.6%
15.5% 4,491
4,491
15.5%
10.7% 74,828
10.7% 74,828
—% 18,928
-% 18,928
8.5% 93,756
8.5% 93,756
8.0% 5,389
5,389
8.0%
29.6% 4,215
4,215
29.6%
14.2% 8,117
8,117
14.2%
16.5% 17,721
16.5% 17,721
12.2% 26,519
12.2% 26,519
434
434
256
256
690
690
8,382
8,382
4
4
8,386
8,386
560
560
1,360
1,360
1,034
1,034
2,954
2,954
1,749
1,749
1,896
1,896
3,645
3,645
16.9% 2,239
2,239
16.9%
13.3% 1,928
1,928
13.3%
15.4% 4,167
4,167
15.4%
11.2% 75,236
11.2% 75,236
—% 19,190
-% 19,190
8.9% 94,426
8.9% 94,426
10.4% 6,145
6,145
10.4%
32.3% 4,004
4,004
32.3%
12.7% 7,421
7,421
12.7%
16.7% 17,570
16.7% 17,570
13.7% 28,231
13.7% 28,231
394
394
275
275
669
669
8,915
8,915
685
685
9,600
9,600
709
709
1,328
1,328
965
965
3,002
3,002
1,906
1,906
2,135
2,135
4,041
4,041
17.6%
17.6%
14.3%
14.3%
16.1%
16.1%
11.8%
11.8%
3.6%
3.6%
10.2%
10.2%
11.5%
11.5%
33.2%
33.2%
13.0%
13.0%
17.1%
17.1%
14.3%
14.3%
__________
(a) Includes sales by our Automotive China Joint Ventures (Automotive China JVs): SAIC General Motors Sales Co., Ltd. (SGMS) and SAIC
(a) Includes sales by our Automotive China Joint Ventures (Automotive China JVs): SAIC General Motors Sales Co., Ltd. (SGMS) and SAIC
GM Wuling Automobile Co., Ltd. (SGMW).
GM Wuling Automobile Co., Ltd. (SGMW).
(b) Includes Industry and GM sales in India and South Africa where we ceased vehicle sales for those domestic markets as of December 31,
(b) Includes Industry and GM sales in India and South Africa where we ceased vehicle sales for those domestic markets as of December 31,
2017.
2017.
(c) Cuba, Iran, North Korea, Sudan and Syria are subject to broad economic sanctions. Accordingly these countries are excluded from industry
(c) Cuba, Iran, North Korea, Sudan and Syria are subject to broad economic sanctions. Accordingly these countries are excluded from industry
sales data and corresponding calculation of market share.
sales data and corresponding calculation of market share.
(d) Certain industry vehicles have been reclassified between these vehicle segments. GM vehicles were not impacted by this change. The prior
(d) Certain industry vehicles have been reclassified between these vehicle segments. GM vehicles were not impacted by this change. The prior
period has been recast to reflect the changes.
period has been recast to reflect the changes.
In the year ended December 31, 2019, we estimate we were the market share leader in each of North America and South America,
In the year ended December 31,2019, we estimate we were the market share leader in each of North America and South America,
and had the number four market share in the Asia/Pacific, Middle East and Africa region, which included the number two market
and had the number four market share in the Asia/Pacific, Middle East and Africa region, which included the number two market
share in China. Refer to the Overview in Management's Discussion and Analysis of Financial Condition and Results of Operations
share in China. Refer to the Overview in Management's Discussion and Analysis of Financial Condition and Results of Operations
(MD&A) for discussion on changes in market share by region.
(MD&A) for discussion on changes in market share by region.
2
2
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
As discussed above, total vehicle sales and market share data provided in the table above includes fleet vehicles. Certain fleet
As discussed above, total vehicle sales and market share data provided in the table above includes fleet vehicles. Certain fleet
transactions, particularly sales to daily rental car companies, are generally less profitable than retail sales to end customers. The
transactions, particularly sales to daily rental car companies, are generally less profitable than retail sales to end customers. The
following table summarizes estimated fleet sales and those sales as a percentage of total vehicle sales (vehicles in thousands):
following table summarizes estimated fleet sales and those sales as a percentage of total vehicle sales (vehicles in thousands):
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
GMNA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
741
GMNA 741
GMI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
498
GMI 498
Total fleet sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,239
Total fleet sales 1,239
740
740
478
478
1,218
1,218
691
691
541
541
1,232
1,232
Fleet sales as a percentage of total vehicle sales . . . . . . . . . . . . . . . . .
16.1%
Fleet sales as a percentage of total vehicle sales 16.1%
14.5%
14.5%
13.8%
13.8%
Product Pricing Several methods are used to promote our products, including the use of dealer, retail and fleet incentives such
Product Pricing Several methods are used to promote our products, including the use of dealer, retail and fleet incentives such
as customer rebates and finance rate support. The level of incentives is dependent upon the level of competition in the markets in
as customer rebates and fmance rate support. The level of incentives is dependent upon the level of competition in the markets in
which we operate and the level of demand for our products.
which we operate and the level of demand for our products.
Cyclical and Seasonal Nature of Business The market for vehicles is cyclical and depends in part on general economic
Cyclical and Seasonal Nature of Business The market for vehicles is cyclical and depends in part on general economic
conditions, credit availability and consumer spending. Vehicle markets are also seasonal. Production varies from month to month.
conditions, credit availability and consumer spending. Vehicle markets are also seasonal. Production varies from month to month.
Vehicle model changeovers occur throughout the year as a result of new market entries.
Vehicle model changeovers occur throughout the year as a result of new market entries.
Relationship with Dealers We market vehicles and automotive parts worldwide primarily through a network of independent
Relationship with Dealers We market vehicles and automotive parts worldwide primarily through a network of independent
authorized retail dealers. These outlets include distributors, dealers and authorized sales, service and parts outlets. The number of
authorized retail dealers. These outlets include distributors, dealers and authorized sales, service and parts outlets. The number of
authorized dealerships were 4,743 in GMNA and 7,907 in GMI at December 31, 2019.
authorized dealerships were 4,743 in GMNA and 7,907 in GMI at December 31, 2019.
m
We and our joint ventures enter into a contract with each authorized dealer agreeing to sell to the dealer one or more specifie
d
We and our joint ventures enter into a contract with each authorized dealer agreeing to sell to the dealer one or more specified
product lines at wholesale prices and granting the dealer the right to sell those vehicles to retail customers from an approved
product lines at wholesale prices and granting the dealer the right to sell those vehicles to retail customers from an approved
location. Our dealers often offer more than one GM brand at a single dealership in a number of our markets. Authorized dealers
location. Our dealers often offer more than one GM brand at a single dealership in a number of our markets. Authorized dealers
offer parts, accessories, service and repairs for GM vehicles in the product lines that they sell using GM parts and accessories. Our
offer parts, accessories, service and repairs for GM vehicles in the product lines that they sell using GM parts and accessories. Our
dealers are authorized to service GM vehicles under our limited warranty program, and those repairs are made only with GM parts.
dealers are authorized to service GM vehicles under our limited warranty program, and those repairs are made only with GM parts.
Our dealers generally provide their customers with access to credit or lease financing, vehicle insurance and extended service
Our dealers generally provide their customers with access to credit or lease fmancing, vehicle insurance and extended service
contracts provided by GM Financial and other financial institutions.
contracts provided by GM Financial and other fmancial institutions.
tt
The quality of GM dealerships and our relationship with our dealers and distributors are critical to our success given that dealers
The quality of GM dealerships and our relationship with our dealers and distributors are critical to our success given that dealers
maintain the primary sales and service interface with the end consumer of our products. In addition to the terms of our contracts
maintain the primary sales and service interface with the end consumer of our products. In addition to the terms of our contracts
with our dealers, we are regulated by various country and state franchise laws and regulations that may supersede those contractual
with our dealers, we are regulated by various country and state franchise laws and regulations that may supersede those contractual
terms and impose specific regulatory requirements and standards for initiating dealer network changes, pursuing terminations for
terms and impose specific regulatory requirements and standards for initiating dealer network changes, pursuing terminations for
cause and other contractual matters.
cause and other contractual matters.
Research, Product and Business Development and Intellectual Property Costs for research, manufacturing engineering,
Research, Product and Business Development and Intellectual Property Costs for research, manufacturing engineering,
product engineering and design and development activities primarily relate to developing new products or services or improving
product engineering and design and development activities primarily relate to developing new products or services or improving
existing products or services, including activities related to vehicle and greenhouse gas (GHG) emissions control, improved fuel
existing products or services, including activities related to vehicle and greenhouse gas (GHG) emissions control, improved fuel
economy, electrification, autonomous vehicles, the safety of drivers and passengers, and urban mobility. Research and development
economy, electrification, autonomous vehicles, the safety of drivers and passengers, and urban mobility. Research and development
expenses were $6.8 billion, $7.8 billion and $7.3 billion in the years ended December 31, 2019, 2018 and 2017.
expenses were $6.8 billion, $7.8 billion and $7.3 billion in the years ended December 31, 2019, 2018 and 2017.
Product Development The Product Development organization is responsible for designing and integrating vehicle and propulsion
Product Development The Product Development organization is responsible for designing and integrating vehicle and propulsion
components to maximize part sharing across multiple vehicle segments. Global teams in Design, Program Management, Component
components to maximize part sharing across multiple vehicle segments. Global teams in Design, Program Management, Component
& Subsystem Engineering, Product Integrity, Safety, Propulsion Systems and Purchasing & Supply Chain collaborate to meet
& Subsystem Engineering, Product Integrity, Safety, Propulsion Systems and Purchasing & Supply Chain collaborate to meet
customer requirements and maximize global economies of scale.
customer requirements and maximize global economies of scale.
Our global vehicle architecture development is headquartered at our Global Technical Center in Warren, Michigan. Cross-
Our global vehicle architecture development is headquartered at our Global Technical Center in Warren, Michigan. Cross-
segment part sharing is an essential enabler to optimize our current vehicle portfolio, as we expect that more than 75% of our
segment part sharing is an essential enabler to optimize our current vehicle portfolio, as we expect that more than 75% of our
global sales volume will come from five vehicle architectures by mid-decade. We will continue to leverage our current architecture
global sales volume will come from five vehicle architectures by mid-decade. We will continue to leverage our current architecture
portfolio to accommodate our customers around the world while achieving our financial goals.
portfolio to accommodate our customers around the world while achieving our fmancial goals.
tt
Battery Electric Vehicles We have committed to an all-electric future and are investing in multiple technologies offering increasing
Battery Electric Vehicles We have committed to an all-electric future and are investing in multiple technologies offering increasing
levels of vehicle electrification with a core focus on zero emission battery electric vehicles as part of our long-term strategy to
levels of vehicle electrification with a core focus on zero emission battery electric vehicles as part of our long-term strategy to
reduce petroleum consumption and GHG emissions. We currently offer the Chevrolet Bolt EV, which recently improved to 259
reduce petroleum consumption and GHG emissions. We currently offer the Chevrolet Bolt EV, which recently improved to 259
3
3
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
miles of range with the 2020 model year. We have also announced our all-new battery electric architecture that will launch on an aa
miles of range with the 2020 model year. We have also announced our all-new battery electric architecture that will launch on an
upcoming Cadillac model. The new platform will be flexible, allowing quick response to customer preferences with a relatively
upcoming Cadillac model. The new platform will be flexible, allowing quick response to customer preferences with a relatively
short design and development lead time. It will be leveraged across multiple brands and vehicle sizes, styles and drive configurations.
short design and development lead time. It will be leveraged across multiple brands and vehicle sizes, styles and drive configurations.
We confirmed the GMC Hummer EV, an upcoming battery electric truck, will be built at Detroit-Hamtramck Assembly, which is
We confirmed the GMC Hummer EV, an upcoming battery electric truck, will be built at Detroit-Hamtramck Assembly, which is
being re-tooled into a fully-dedicated electric vehicle facility. In addition, we have announced plans to mass-produce battery cells
being re-tooled into a fully-dedicated electric vehicle facility. In addition, we have announced plans to mass-produce battery cells
for future battery electric vehicles through an equally owned joint venture with LG Chem, Ltd.
for future battery electric vehicles through an equally owned joint venture with LG Chem, Ltd.
u
To support mass market adoption of electric vehicles, we are working to ensure that our customers will have access to a robust,
To support mass market adoption of electric vehicles, we are working to ensure that our customers will have access to a robust,
ubiquitous and seamless charging infrastructure. For personal vehicles, this means strategically addressing charging needs at home,
ubiquitous and seamless charging infrastructure. For personal vehicles, this means strategically addressing charging needs at home,
the workplace and in public locations. We have announced collaborative work with several charge network operators to provide
the workplace and in public locations. We have announced collaborative work with several charge network operators to provide
real-time data on their respective networks and charge station health to filter into our Energy Assist feature within the myChevrolet
real-time data on their respective networks and charge station health to filter into our Energy Assist feature within the myChevrolet
app, currently available to Chevrolet Bolt EV drivers. This collaboration will enable access to the largest collective electric vehicle
app, currently available to Chevrolet Bolt EV drivers. This collaboration will enable access to the largest collective electric vehicle
charging network in the U.S.
charging network in the U.S.
Car- and Ride-Sharing Maven is a shared vehicle marketplace that leverages a versatile software and operational platform to
Car- and Ride-Sharing Maven is a shared vehicle marketplace that leverages a versatile software and operational platform to
provide members with on-demand access to vehicles through two primary services, Maven Gig and Maven Car Sharing. Maven
provide members with on-demand access to vehicles through two primary services, Maven Gig and Maven Car Sharing. Maven
Gig allows members to access vehicles that can be used in ride-sharing and delivery with companies such as Uber Technologies
Gig allows members to access vehicles that can be used in ride-sharing and delivery with companies such as Uber Technologies
Inc. and GrubHub Inc. Maven Car Sharing is a consumer service that provides on-demand access to Maven-owned and peer-owned
Inc. and GrubHub Inc. Maven Car Sharing is a consumer service that provides on-demand access to Maven-owned and peer-owned
vehicles. Maven is available in 15 cities in the U.S., Canada and Australia at December 31, 2019.
vehicles. Maven is available in 15 cities in the U.S., Canada and Australia at December 31, 2019.
Autonomous Technology We expect autonomous technology to lead to a future of zero crashes, zero emissions and zero
Autonomous Technology We expect autonomous technology to lead to a future of zero crashes, zero emissions and zero
congestion. We are among the leaders in the industry with significant global real-world experience in delivering connectivity and
congestion. We are among the leaders in the industry with significant global real-world experience in delivering connectivity and
advanced safety features that are the building blocks to more advanced automation features that are driving our leadership position
advanced safety features that are the building blocks to more advanced automation features that are driving our leadership position
in the development of autonomous technology. An example of our advanced technology is Super Cruise, a driver assistance feature
in the development of autonomous technology. An example of our advanced technology is Super Cruise, a driver assistance feature
that enables hands-free driving on the highway, which will be expanded to all Cadillac models. We are actively testing autonomous
that enables hands-free driving on the highway, which will be expanded to all Cadillac models. We are actively testing autonomous
vehicles in the U.S. Gated by safety and regulation, we continue to make significant progress toward commercialization of a
vehicles in the U.S. Gated by safety and regulation, we continue to make significant progress toward commercialization of a
network of on-demand autonomous vehicles in the U.S. The Cruise AV is our production-intent self-driving vehicle that was
network of on-demand autonomous vehicles in the U.S. The Cruise AV is our production-intent self-driving vehicle that was
engineered from the start to operate safely on its own, with no driver.
engineered from the start to operate safely on its own, with no driver.
a
Alternative Fuel Vehicles We believe alternative fuels offer significant potential to reduce petroleum consumption and resulting
Alternative Fuel Vehicles We believe alternative fuels offer significant potential to reduce petroleum consumption and resulting
GHG emissions in the transportation sector. By leveraging experience and capability developed around these technologies in our
GHG emissions in the transportation sector. By leveraging experience and capability developed around these technologies in our
global operations, we continue to develop FlexFuel vehicles that can run on ethanol-gasoline blend fuels as well as technologies
global operations, we continue to develop FlexFuel vehicles that can run on ethanol-gasoline blend fuels as well as technologies
that support compressed natural gas and liquefied petroleum gas. We offer several 2020 model year FlexFuel vehicles in the U.S.
that support compressed natural gas and liquefied petroleum gas. We offer several 2020 model year FlexFuel vehicles in the U.S.
and Canada to retail and fleet customers capable of operating on gasoline, E85 ethanol or any combination of the two. We also
and Canada to retail and fleet customers capable of operating on gasoline, E85 ethanol or any combination of the two. We also
support the development of biodiesel blend fuels, which are alternative diesel fuels produced from renewable sources.
support the development of biodiesel blend fuels, which are alternative diesel fuels produced from renewable sources.
Hydrogen Fuel Cell Technology Another part of our long-term strategy to reduce petroleum consumption and GHG emissions
Hydrogen Fuel Cell Technology Another part of our long-term strategy to reduce petroleum consumption and GHG emissions
is our commitment to the development of our hydrogen fuel cell technology. Our Chevrolet Equinox fuel cell electric vehicle
is our commitment to the development of our hydrogen fuel cell technology. Our Chevrolet Equinox fuel cell electric vehicle
demonstration programs, such as Project Driveway, have accumulated more than three million miles of real-world driving. These
demonstration programs, such as Project Driveway, have accumulated more than three million miles of real-world driving. These
programs are helping us identify consumer and infrastructure needs to understand the business case for potential production of
programs are helping us identify consumer and infrastructure needs to understand the business case for potential production of
vehicles with this technology. We are exploring non-traditional automotive uses for fuel cells in several areas, including
vehicles with this technology. We are exploring non-traditional automotive uses for fuel cells in several areas, including
demonstrations with the U.S. Army and U.S. Navy. In addition, we signed a co-development agreement and established a
demonstrations with the U.S. Army and U.S. Navy. In addition, we signed a co-development agreement and established a
nonconsolidated joint venture with Honda Motor Co., Ltd. (Honda) for a next-generation fuel cell system and hydrogen storage
nonconsolidated joint venture with Honda Motor Co., Ltd. (Honda) for a next-generation fuel cell system and hydrogen storage
technologies, aiming for commercialization in the early 2020s.
technologies, aiming for commercialization in the early 2020s.
OnStar and Vehicle Connectivity We offer OnStar and connected services to more than 22 million connected vehicles globally
OnStar and Vehicle Connectivity We offer OnStar and connected services to more than 22 million connected vehicles globally
through subscription-based and complimentary services. OnStar provides safety and security services for retail and fleet customers,
through subscription-based and complimentary services. OnStar provides safety and security services for retail and fleet customers,
including automatic crash response, emergency services, roadside assistance, crisis assist, stolen vehicle assistance and turn-by-
including automatic crash response, emergency services, roadside assistance, crisis assist, stolen vehicle assistance and turn-by-
turn navigation. We also offer a variety of connected services, including mobile applications for owners to remotely control their
turn navigation. We also offer a variety of connected services, including mobile applications for owners to remotely control their
vehicles and electric vehicle owners to locate charging stations, on-demand vehicle diagnostics, GM Smart Driver, GM Marketplace
vehicles and electric vehicle owners to locate charging stations, on-demand vehicle diagnostics, GM Smart Driver, GM Marketplace
in-vehicle commerce, connected navigation, SiriusXM with 360L and 4G LTE wireless connectivity. Additionally, we have
in-vehicle commerce, connected navigation, SiriusXM with 360L and 4G LTE wireless connectivity. Additionally, we have
announced plans to integrate an in-vehicle Alexa experience through Amazon.com to millions of eligible model year 2018 and
announced plans to integrate an in-vehicle Alexa experience through Amazon.com to millions of eligible model year 2018 and
newer vehicles in 2020, and integrate Google Voice Assistant, navigation and app ecosystem into GM infotainment systems
newer vehicles in 2020, and integrate Google Voice Assistant, navigation and app ecosystem into GM infotainment systems
beginning in 2021.
beginning in 2021.
Intellectual Property We are constantly innovating and hold a significant number of patents, copyrights, trade secrets and other
Intellectual Property We are constantly innovating and hold a significant number of patents, copyrights, trade secrets and other
intellectual property that protect those innovations in numerous countries. While no single piece of intellectual property is
intellectual property that protect those innovations in numerous countries. While no single piece of intellectual property is
4
4
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
individually material to our business as a whole, our intellectual property is important to our operations and continued technological
individually material to our business as a whole, our intellectual property is important to our operations and continued technological
development. Additionally, we hold a number of trademarks and service marks that are very important to our identity and recognition
development. Additionally, we hold a number of trademarks and service marks that are very important to our identity and recognition
in the marketplace.
in the marketplace.
Raw Materials, Services and Supplies We purchase a wide variety of raw materials, parts, supplies, energy, freight, transportation
Raw Materials, Services and Supplies We purchase a wide variety ofraw materials, parts, supplies, energy, freight, transportation
and other services from numerous suppliers to manufacture our products. The raw materials primarily include steel, aluminum,
and other services from numerous suppliers to manufacture our products. The raw materials primarily include steel, aluminum,
resins, copper, lead and platinum group metals. We have not experienced any significant shortages of raw materials and normally
resins, copper, lead and platinum group metals. We have not experienced any significant shortages of raw materials and normally
do not carry substantial inventories of such raw materials in excess of levels reasonably required to meet our production
do not carry substantial inventories of such raw materials in excess of levels reasonably required to meet our production
requirements. Costs are expected to remain elevated due to the price of commodities and the continuing existence of tariffs.
requirements. Costs are expected to remain elevated due to the price of commodities and the continuing existence of tariffs.
In some instances, we purchase systems, components, parts and supplies from a single source and may be at an increased risk
In some instances, we purchase systems, components, parts and supplies from a single source and may be at an increased risk
for supply disruptions. The inability or unwillingness of these sources to supply us with parts and supplies could have a material
for supply disruptions. The inability or unwillingness of these sources to supply us with parts and supplies could have a material
adverse effect on our production capacity. Combined purchases from our two largest suppliers were 11% of our total purchases in
adverse effect on our production capacity. Combined purchases from our two largest suppliers were 11% of our total purchases in
the year ended December 31, 2019 and 12% of our total purchases in each of the years ended December 31, 2018 and 2017. Refer
the year ended December 31, 2019 and 12% of our total purchases in each of the years ended December 31, 2018 and 2017. Refer
to Item 1A. Risk Factors for further discussion of these risks.
to Item 1A. Risk Factors for further discussion of these risks.
Environmental and Regulatory Matters
Environmental and Regulatory Matters
Automotive Criteria Emissions Control Our products are subject to laws and regulations globally that require us to control
Automotive Criteria Emissions Control Our products are subject to laws and regulations globally that require us to control
certain non-GHG automotive emissions, including vehicle and engine exhaust emission standards, vehicle evaporative emission
certain non-GHG automotive emissions, including vehicle and engine exhaust emission standards, vehicle evaporative emission
standards and onboard diagnostic (OBD) system requirements. Emission requirements have become more stringent as a result of
standards and onboard diagnostic (OBD) system requirements. Emission requirements have become more stringent as a result of
stricter standards and new diagnostic requirements that have come into force in many markets around the world, often with very
stricter standards and new diagnostic requirements that have come into force in many markets around the world, often with very
little harmonization. While we believe all of our products are designed and manufactured in material compliance with substantially
little harmonization. While we believe all of our products are designed and manufactured in material compliance with substantially
all vehicle emissions requirements, regulatory authorities may conduct ongoing evaluations of products from all manufacturers.
all vehicle emissions requirements, regulatory authorities may conduct ongoing evaluations of products from all manufacturers.
The U.S. federal government, through the Environmental Protection Agency (EPA), imposes stringent exhaust and evaporative
The U.S. federal government, through the Environmental Protection Agency (EPA), imposes stringent exhaust and evaporative
emission control requirements on vehicles sold in the U.S. The California Air Resources Board (CARB) likewise imposes stringent
emission control requirements on vehicles sold in the U.S. The California Air Resources Board (CARB) likewise imposes stringent
exhaust and evaporative emission standards. These emission control standards will likely increase the time and mileage periods
exhaust and evaporative emission standards. These emission control standards will likely increase the time and mileage periods
over which manufacturers are responsible for a vehicle's emission performance. The Clean Air Act permits states that have areas
over which manufacturers are responsible for a vehicle's emission performance. The Clean Air Act permits states that have areas
with air quality compliance issues to adopt California emission standards in lieu of federal requirements. Fourteen states and the
with air quality compliance issues to adopt California emission standards in lieu of federal requirements. Fourteen states and the
District of Columbia have adopted California emission standards, and there is a possibility that additional U.S. jurisdictions could
District of Columbia have adopted California emission standards, and there is a possibility that additional U.S. jurisdictions could
adopt California emission requirements in the future.
adopt California emission requirements in the future.
The Canadian federal government's current vehicle pollutant emission requirements are generally aligned with those of the U.S.
The Canadian federal government's current vehicle pollutant emission requirements are generally aligned with those of the U.S.
federal requirements.
federal requirements.
Each model year we must obtain certification that our vehicles and heavy-duty engines will meet emission requirements of the
Each model year we must obtain certification that our vehicles and heavy-duty engines will meet emission requirements of the
EPA before we can sell vehicles in the U.S. and Canada, and of CARB before we can sell vehicles in California and other states
EPA before we can sell vehicles in the U.S. and Canada, and of CARB before we can sell vehicles in California and other states
that have adopted the California emission requirements.
that have adopted the California emission requirements.
In 2019, certain areas within China began implementation of the China 6 emission standard (China 6) requirements. China 6
In 2019, certain areas within China began implementation of the China 6 emission standard (China 6) requirements. China 6
combines elements of both European Union (EU) and U.S. standards and increases the time and mileage periods over which
combines elements of both European Union (EU) and U.S. standards and increases the time and mileage periods over which
manufacturers are responsible for a vehicle's emission performance. Nationwide implementation of China 6a for new registrations
manufacturers are responsible for a vehicle's emission performance. Nationwide implementation of China 6a for new registrations
is expected in July 2020, and the more stringent China 6b is expected to be implemented in July 2023. Localities can implement
is expected in July 2020, and the more stringent China 6b is expected to be implemented in July 2023. Localities can implement
China 6 requirements earlier than the nationwide deadlines if certain enabling criteria are met. For additional information, refer
China 6 requirements earlier than the nationwide deadlines if certain enabling criteria are met. For additional information, refer
to Item 1A. Risk Factors.
to Item 1A. Risk Factors.
Brazil has recently approved a new set of national emissions standards named L7, to be implemented in 2022, and L8, to be
Brazil has recently approved a new set of national emissions standards named L7, to be implemented in 2022, and L8, to be
implemented in 2025. L7 standards include exhaust, durability, evaporative and noise limits, new OBD requirements and a phase-
implemented in 2025. L7 standards include exhaust, durability, evaporative and noise limits, new OBD requirements and a phase-
in for onboard refueling vapor recovery systems. L8 standards include emission targets for real driving emissions and reduce
in for onboard refueling vapor recovery systems. L8 standards include emission targets for real driving emissions and reduce
exhaust limits every two years until 2031. Many of the requirements are aligned with those of the EPA.
exhaust limits every two years until 2031. Many of the requirements are aligned with those of the EPA.
As a result of the sale of the Opel/Vauxhall Business, GM’s vehicle presence in Europe is smaller, but GM may still be affected
As a result of the sale of the Opel/Vauxhall Business, GM's vehicle presence in Europe is smaller, but GM may still be affected
by actions taken by regulators related both to Opel/Vauxhall vehicles sold before the sale of the Opel/Vauxhall Business as well
by actions taken by regulators related both to Opel/Vauxhall vehicles sold before the sale of the Opel/Vauxhall Business as well
as to other vehicles GM continues to sell in Europe. In the EU, increased scrutiny of compliance with emissions standards may
as to other vehicles GM continues to sell in Europe. In the EU, increased scrutiny of compliance with emissions standards may
result in changes to these standards, including implementation of real driving emissions tests, as well as stricter interpretations or
result in changes to these standards, including implementation of real driving emissions tests, as well as stricter interpretations or
redefinition of these standards and more rigorous enforcement. For example, our former German subsidiary has participated in
redefinition of these standards and more rigorous enforcement. For example, our former German subsidiary has participated in
5
5
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
continuing discussions with German and European authorities concerning emissions control systems. For additional information,
continuing discussions with German and European authorities concerning emissions control systems. For additional information,
refer to Note 22 to our consolidated financial statements.
refer to Note 22 to our consolidated financial statements.
Automotive Fuel Economy and Greenhouse Gas Emissions In the U.S., the National Highway Traffic Safety Administration
Automotive Fuel Economy and Greenhouse Gas Emissions In the U.S., the National Highway Traffic Safety Administration
(NHTSA) promulgates and enforces Corporate Average Fuel Economy (CAFE) standards for three separate fleets: domestically
(NHTSA) promulgates and enforces Corporate Average Fuel Economy (CAFE) standards for three separate fleets: domestically
produced cars, imported cars and light-duty trucks. Manufacturers are subject to substantial civil penalties if they fail to meet the
produced cars, imported cars and light-duty trucks. Manufacturers are subject to substantial civil penalties if they fail to meet the
applicable CAFE standard in any model year, after considering all available credits for the preceding five model years, expected
applicable CAFE standard in any model year, after considering all available credits for the preceding five model years, expected
credits for the three succeeding model years and credits obtained from other manufacturers. The amount of these civil penalties
credits for the three succeeding model years and credits obtained from other manufacturers. The amount of these civil penalties
is the subject of litigation currently pending in the U.S. Court of Appeals for the Second Circuit. In addition to federal CAFE
is the subject of litigation currently pending in the U.S. Court of Appeals for the Second Circuit. In addition to federal CAFE
standards, the EPA promulgates and enforces GHG emission standards, which are effectively fuel economy standards because the
standards, the EPA promulgates and enforces GHG emission standards, which are effectively fuel economy standards because the
majority of vehicle GHG emissions are carbon dioxide emissions that are emitted in direct proportion to the amount of fuel
majority of vehicle GHG emissions are carbon dioxide emissions that are emitted in direct proportion to the amount of fuel
consumed by a vehicle. The EPA and NHTSA also regulate the fuel efficiency and GHG emissions of medium- and heavy-duty
consumed by a vehicle. The EPA and NHTSA also regulate the fuel efficiency and GHG emissions of medium- and heavy-duty
vehicles, imposing more stringent standards over time.
vehicles, imposing more stringent standards over time.
In addition, CARB has asserted the right to promulgate and enforce its own state GHG standards for motor vehicles, and other
In addition, CARB has asserted the right to promulgate and enforce its own state GHG standards for motor vehicles, and other
states have asserted the right to adopt CARB's standards. CARB regulations previously stated that compliance with the EPA light-
states have asserted the right to adopt CARB's standards. CARB regulations previously stated that compliance with the EPA light-
duty program is deemed compliance with CARB standards. However, on December 12, 2018, CARB amended this regulation to
duty program is deemed compliance with CARB standards. However, on December 12, 2018, CARB amended this regulation to
state that, in the event the EPA alters federal GHG stringency, compliance with the EPA's GHG emissions standards will no longer
state that, in the event the EPA alters federal GHG stringency, compliance with the EPA's GHG emissions standards will no longer
be deemed compliance with CARB's separate requirements. Likewise, NHTSA and the EPA have recently issued a rule asserting
be deemed compliance with CARB's separate requirements. Likewise, NHTSA and the EPA have recently issued a rule asserting
that California is preempted from regulating GHG emissions, which is currently being challenged through litigation. As a result,
that California is preempted from regulating GHG emissions, which is currently being challenged through litigation. As a result,
depending on the outcome of the federal CAFE and GHG rulemaking and related litigation and the finality of CARB's regulatory
depending on the outcome of the federal CAFE and GHG rulemaking and related litigation and the finality of CARB's regulatory
amendment, in the future GM might be required to meet California GHG standards that are different than the EPA standards.
amendment, in the future GM might be required to meet California GHG standards that are different than the EPA standards.
CARB has also imposed the requirement that increasing percentages of Zero Emission Vehicles (ZEVs) must be sold in California.
CARB has also imposed the requirement that increasing percentages of Zero Emission Vehicles (ZEVs) must be sold in California.
The Clean Air Act permits states to adopt California emission standards, and 11 have adopted the ZEV requirements. The EPA has
The Clean Air Act permits states to adopt California emission standards, and 11 have adopted the ZEV requirements. The EPA has
recently revoked the waiver it had granted to California that permitted its ZEV program. Depending on the finality of that revocation,
recently revoked the waiver it had granted to California that permitted its ZEV program. Depending on the fmality of that revocation,
there is a possibility that additional U.S. jurisdictions could adopt California ZEV requirements in the future.
there is a possibility that additional U.S. jurisdictions could adopt California ZEV requirements in the future.
In Canada, light- and heavy-duty GHG regulations are currently patterned after the EPA GHG emissions standards. However,
In Canada, light- and heavy-duty GHG regulations are currently patterned after the EPA GHG emissions standards. However,
the Canadian government will be conducting a mid-term review of its 2022 to 2025 model year light-duty GHG standards and
the Canadian government will be conducting a mid-term review of its 2022 to 2025 model year light-duty GHG standards and
there is an increased risk that future Canadian light-duty GHG regulations may not be aligned with the EPA regulations. In addition,
there is an increased risk that future Canadian light-duty GHG regulations may not be aligned with the EPAregulations. In addition,
the Canadian province of Quebec has adopted ZEV requirements for the 2018 to 2025 model years largely based on California
the Canadian province of Quebec has adopted ZEV requirements for the 2018 to 2025 model years largely based on California
program requirements. The province of British Columbia also passed legislation in May 2019 to enable similar ZEV regulations
program requirements. The province of British Columbia also passed legislation in May 2019 to enable similar ZEV regulations
in the near term, and governments in Canada could adopt additional ZEV requirements in the future.
in the near term, and governments in Canada could adopt additional ZEV requirements in the future.
China has two fuel economy requirements for passenger vehicles: an individual vehicle pass-fail type approval requirement and
China has two fuel economy requirements for passenger vehicles: an individual vehicle pass-fail type approval requirement and
a fleet average fuel consumption requirement. With a focus on the fleet average program, the current China Phase 4 fleet average
a fleet average fuel consumption requirement. With a focus on the fleet average program, the current China Phase 4 fleet average
fuel consumption requirement, which went into effect in 2016, is based on curb weight with full compliance required by 2020.
fuel consumption requirement, which went into effect in 2016, is based on curb weight with full compliance required by 2020.
China Phase 4 has continued subsidies for plug-in hybrid, battery electric and fuel cell vehicles, which are referred to as New
China Phase 4 has continued subsidies for plug-in hybrid, battery electric and fuel cell vehicles, which are referred to as New
Energy Vehicles (NEVs). China Phase 5 has been developed with a planned start in 2021 and full compliance is required by 2025.
Energy Vehicles (NEVs). China Phase 5 has been developed with a planned start in 2021 and full compliance is required by 2025.
In addition, China has established an NEV Mandate that will require passenger car manufacturers to produce a certain volume of
In addition, China has established an NEV Mandate that will require passenger car manufacturers to produce a certain volume of
NEVs to generate credits in 2019 and beyond to offset internal combustion engine vehicle production volume. The number of
NEVs to generate credits in 2019 and beyond to offset internal combustion engine vehicle production volume. The number of
credits per car is based on the level of electric range and energy efficiency, with the goal of increasing NEV volume penetrations.
credits per car is based on the level of electric range and energy efficiency, with the goal of increasing NEV volume penetrations.
Uncommitted NEV credits may be used to assist compliance with the fleet average fuel consumption requirement. China has set
Uncommitted NEV credits may be used to assist compliance with the fleet average fuel consumption requirement. China has set
forth NEV credit targets for 2019 and 2020 and is setting forth new NEV credit targets aiming at further increasing volumes of
forth NEV credit targets for 2019 and 2020 and is setting forth new NEV credit targets aiming at further increasing volumes of
NEVs between 2021 and 2025.
NEVs between 2021 and 2025.
In Brazil, the Secretary of Industry and Development promulgates and enforces CAFE standards and has recently enforced a
In Brazil, the Secretary of Industry and Development promulgates and enforces CAFE standards and has recently enforced a
new CAFE program for the period October 2020 to September 2026 and October 2026 to September 2032 for light-duty and mid-
new CAFE program for the period October 2020 to September 2026 and October 2026 to September 2032 for light-duty and mid-
size trucks and sport utility vehicles (SUVs), including diesel vehicles, imposing more stringent standards for each period.
size trucks and sport utility vehicles (SUVs), including diesel vehicles, imposing more stringent standards for each period.
Regulators in other jurisdictions have already adopted or are developing fuel economy or carbon dioxide regulations. If regulators
Regulators in other jurisdictions have already adopted or are developing fuel economy or carbon dioxide regulations. If regulators
in these jurisdictions seek to impose and enforce standards that are misaligned with market conditions, we may be forced to take
in these jurisdictions seek to impose and enforce standards that are misaligned with market conditions, we may be forced to take
various actions to increase market support programs for certain vehicles and curtail production of others in order to achieve
various actions to increase market support programs for certain vehicles and curtail production of others in order to achieve
compliance. We regularly evaluate our current and future product plans and strategies for compliance with fuel economy and GHG
compliance. We regularly evaluate our current and future product plans and strategies for compliance with fuel economy and GHG
regulations.
regulations.
6
6
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Industrial Environmental Controll Our operations are subject to a wide range of environmental protection laws including those
Industrial Environmental Control Our operations are subject to a wide range of environmental protection laws including those
regulating air emissions, water discharge, waste management and environmental cleanup. Certain environmental statutes require
regulating air emissions, water discharge, waste management and environmental cleanup. Certain environmental statutes require
that responsible parties fund remediation actions regardless of fault, legality of original disposal or ownership of a disposal site.
that responsible parties fund remediation actions regardless of fault, legality of original disposal or ownership of a disposal site.
Under certain circumstances these laws impose joint and several liability as well as liability for related damages to natural resources.
Under certain circumstances these laws impose joint and several liability as well as liability for related damages to natural resources.
To mitigate the effects of our worldwide operations on the environment, we are converting as many of our worldwide operations
To mitigate the effects of our worldwide operations on the environment, we are converting as many of our worldwide operations
as practicable to landfill-free operations, which reduces GHG emissions associated with waste disposal. At December 31, 2019,
as practicable to landfill-free operations, which reduces GHG emissions associated with waste disposal. At December 31, 2019,
58 (or 45%) of our manufacturing operations and 36 (or 38%) of our non-manufacturing operations were landfill-free. At our
58 (or 45%) of our manufacturing operations and 36 (or 38%) of our non-manufacturing operations were landfill-free. At our
landfill-free manufacturing operations, 90% of waste materials are composted, reused or recycled and 8% are converted to energy
landfill-free manufacturing operations, 90% of waste materials are composted, reused or recycled and 8% are converted to energy
at waste-to-energy facilities. We estimate that our waste reduction program diverted 1.2 million metric tons of waste from landfills
at waste-to-energy facilities. We estimate that our waste reduction program diverted 1.2 million metric tons of waste from landfills
in 2019, resulting in 5.6 million metric tons of GHG emissions avoided in global manufacturing operations, including construction,
in 2019, resulting in 5.6 million metric tons of GHG emissions avoided in global manufacturing operations, including construction,
demolition and remediation wastes.
demolition and remediation wastes.
In addition to minimizing our impact on the environment, our landfill-free program and total waste reduction commitments
In addition to minimizing our impact on the environment, our landfill-free program and total waste reduction commitments
generate income from the sale of production by-products, reduce our use of material and help to reduce the risks and financial
generate income from the sale of production by-products, reduce our use of material and help to reduce the risks and financial
liabilities associated with waste disposal.
liabilities associated with waste disposal.
We continue our efforts to increase our use of renewable energy, improve our energy efficiency and work to drive growth and
We continue our efforts to increase our use of renewable energy, improve our energy efficiency and work to drive growth and
scale of renewables. We are committed to meeting the electricity needs of our operations worldwide with renewable energy by
scale of renewables. We are committed to meeting the electricity needs of our operations worldwide with renewable energy by
2040, pulling forward our previous commitment by 10 years. Through December 31, 2019, we implemented projects and signed
2040, pulling forward our previous commitment by 10 years. Through December 31, 2019, we implemented projects and signed
renewable energy contracts globally that brought our total renewable energy capacity to over 400 megawatts, which represents
renewable energy contracts globally that brought our total renewable energy capacity to over 400 megawatts, which represents
approximately 20% of our global electricity use. In 2019, we executed our largest green tariff to date with DTE Energy Company,
approximately 20% of our global electricity use. In 2019, we executed our largest green tariff to date with DTE Energy Company,
sourcing 300,000 megawatt hours of renewable energy that will begin supplying us in early 2021. We continue to seek opportunities
sourcing 300,000 megawatt hours of renewable energy that will begin supplying us in early 2021. We continue to seek opportunities
for a diversified renewable energy portfolio including wind, solar, and landfill gas. In 2019 Energy Star certified one assembly
for a diversified renewable energy portfolio including wind, solar, and landfill gas. In 2019 Energy Star certified one assembly
plant in Canada through Natural Resources Canada and eight buildings in the U.S. for superior energy management. We also met
plant in Canada through Natural Resources Canada and eight buildings in the U.S. for superior energy management. We also met
the EPA Energy Star Challenge for Industry (EPA Challenge) at two additional sites globally by reducing energy intensity an
the EPA Energy Star Challenge for Industry (EPA Challenge) at two additional sites globally by reducing energy intensity an
average of 11% at these sites within two years. To meet the EPA Challenge, industrial sites must reduce energy intensity by 10%
average of 11% at these sites within two years. To meet the EPA Challenge, industrial sites must reduce energy intensity by 10%
within a five year period. In total, 73 GM-owned manufacturing sites have met the EPA Challenge, with many sites achieving the
within a five year period. In total, 73 GM-owned manufacturing sites have met the EPA Challenge, with many sites achieving the
goal multiple times for a total of 131 recognitions. Additionally, we received recognition from the U.S. Department of Energy
goal multiple times for a total of 131 recognitions. Additionally, we received recognition from the U.S. Department of Energy
(DOE) of 50001 Ready status for 27 facilities. The U.S. DOE 50001 Ready program is a self-guided approach for facilities to
(DOE) of 50001 Ready status for 27 facilities. The U.S. DOE 50001 Ready program is a self-guided approach for facilities to
establish an energy management system and self-attest to the structure of ISO 50001, a voluntary global standard for energy
establish an energy management system and self-attest to the structure of ISO 50001, a voluntary global standard for energy
management systems in industrial, commercial and institutional facilities. These efforts minimize our utility expenses and are part
management systems in industrial, commercial and institutional facilities. These efforts minimize our utility expenses and are part
of our approach to address climate change by setting a GHG emissions reduction target, collecting accurate data, following our
of our approach to address climate change by setting a GHG emissions reduction target, collecting accurate data, following our
business plan to operate more efficiently and publicly reporting progress against our target.
business plan to operate more efficiently and publicly reporting progress against our target.
Chemical Regulations We continually monitor the implementation of chemical regulations to maintain compliance and evaluate
Chemical Regulations We continually monitor the implementation of chemical regulations to maintain compliance and evaluate
their effect on our business, suppliers and the automotive industry.
their effect on our business, suppliers and the automotive industry.
Globally, governmental agencies continue to introduce new legislation and regulations related to the selection and use of chemicals
Globally, governmental agencies continue to introduce new legislation and regulations related to the selection and use of chemicals
by mandating broad prohibitions or restrictions and implementing green chemistry, life cycle analysis and product stewardship
by mandating broad prohibitions or restrictions and implementing green chemistry, life cycle analysis and product stewardship
initiatives. These initiatives give broad regulatory authority to ban or restrict the use of certain chemical substances and potentially
initiatives. These initiatives give broad regulatory authority to ban or restrict the use of certain chemical substances and potentially
affect automobile manufacturers' responsibilities for vehicle components at the end of a vehicle's life, as well as chemical selection
affect automobile manufacturers' responsibilities for vehicle components at the end of a vehicle's life, as well as chemical selection
for product development and manufacturing. Global treaties and initiatives such as the Stockholm, Basel and Rotterdam
for product development and manufacturing. Global treaties and initiatives such as the Stockholm, Basel and Rotterdam
Conventions on Chemicals and Waste and the Minamata Convention on Mercury, are driving chemical regulations across signatory
Conventions on Chemicals and Waste and the Minamata Convention on Mercury, are driving chemical regulations across signatory
countries. In addition, more global jurisdictions are establishing substance standards with regard to Vehicle Interior Air Quality.
countries. In addition, more global jurisdictions are establishing substance standards with regard to Vehicle Interior Air Quality.
Chemical regulations are increasing in North America. In the U.S. the EPA is moving forward with risk analysis and management
Chemical regulations are increasing in North America. In the U.S. the EPA is moving forward with risk analysis and management
of high priority chemicals under the authority of the 2016 Lautenberg Chemical Safety for the 21st Century Act, and several U.S.
of high priority chemicals under the authority of the 2016 Lautenberg Chemical Safety for the 21st Century Act, and several U.S.
states have chemical management regulations that can affect vehicle design such as the California and Washington laws banning
states have chemical management regulations that can affect vehicle design such as the California and Washington laws banning
the use of copper in brake friction material. Chemical restrictions in Canada continue to steadily progress as a result of Environment
the use of copper in brake friction material. Chemical restrictions in Canada continue to steadily progress as a result of Environment
and Climate Change Canada's Chemical Management Plan to assess existing substances and implement risk management controls
and Climate Change Canada's Chemical Management Plan to assess existing substances and implement risk management controls
on any chemical deemed toxic.
on any chemical deemed toxic.
China prohibits the use of several chemical substances in vehicles. There are also various regulations in China stipulating the
China prohibits the use of several chemical substances in vehicles. There are also various regulations in China stipulating the
requirements for chemical management. Among other things, these regulations restrict the use, import and export of various
requirements for chemical management. Among other things, these regulations restrict the use, import and export of various
chemical substances. The failure of our joint venture partners or our suppliers to comply with these regulations could disrupt
chemical substances. The failure of our joint venture partners or our suppliers to comply with these regulations could disrupt
production in China or prevent our joint venture partners from selling the affected products in the China market.
production in China or prevent our joint venture partners from selling the affected products in the China market.
7
7
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
These emerging laws and regulations will potentially lead to increases in costs and supply chain complexity. We believe that
These emerging laws and regulations will potentially lead to increases in costs and supply chain complexity. We believe that
we are materially in compliance with substantially all of these requirements or expect to be materially in compliance by the required
we are materially in compliance with substantially all of these requirements or expect to be materially in compliance by the required
dates.
dates.
Safety In the U.S. the National Traffic and Motor Vehicle Safety Act of 1966 prohibits the sale of any new vehicle or equipment
Safety In the U.S. the National Traffic and Motor Vehicle Safety Act of 1966 prohibits the sale of any new vehicle or equipment
in the U.S. that does not conform to applicable vehicle safety standards established by NHTSA. If we or NHTSA determine that
in the U.S. that does not conform to applicable vehicle safety standards established by NHTSA. If we or NHTSA determine that
either a vehicle or vehicle equipment does not comply with a safety standard or if a vehicle defect creates an unreasonable safety
either a vehicle or vehicle equipment does not comply with a safety standard or if a vehicle defect creates an unreasonable safety
risk, the manufacturer is required to notify owners and provide a remedy. We are required to report certain information relating to
risk, the manufacturer is required to notify owners and provide a remedy. We are required to report certain information relating to
certain customer complaints, warranty claims, field reports and notices and claims involving property damage, injuries and fatalities
certain customer complaints, warranty claims, field reports and notices and claims involving property damage, injuries and fatalities
in the U.S. and claims involving fatalities outside the U.S. We are also required to report certain information concerning safety
in the U.S. and claims involving fatalities outside the U.S. We are also required to report certain information concerning safety
recalls and other safety campaigns outside the U.S.
recalls and other safety campaigns outside the U.S.
ff
Outside the U.S. safety standards and recall regulations often have the same purpose as the U.S. standards but may differ in their
Outside the U.S. safety standards and recall regulations often have the same purpose as the U.S. standards but may differ in their
requirements and test procedures, adding complexity to regulatory compliance.
requirements and test procedures, adding complexity to regulatory compliance.
Automotive Financing - GM Financial GM Financial is our global captive automotive finance company and our global provider
Automotive Financing - GM Financial GM Financial is our global captive automotive fmance company and our global provider
of automobile finance solutions. GM Financial conducts its business in North America, South America and through joint ventures
of automobile fmance solutions. GM Financial conducts its business in North America, South America and through joint ventures
in Asia/Pacific.
in Asia/Pacific.
GM Financial provides retail loan and lease lending across the credit spectrum. Additionally, GM Financial offers commercial
GM Financial provides retail loan and lease lending across the credit spectrum. Additionally, GM Financial offers commercial
lending products to dealers including new and used vehicle inventory floorplan financing and dealer loans, which are loans to
lending products to dealers including new and used vehicle inventory floorplan financing and dealer loans, which are loans to
finance improvements to dealership facilities, to provide working capital, and to purchase and/or finance dealership real estate.
finance improvements to dealership facilities, to provide working capital, and to purchase and/or finance dealership real estate.
Other commercial lending products include financing for parts and accessories, dealer fleets and storage centers.
Other commercial lending products include fmancing for parts and accessories, dealer fleets and storage centers.
In North America, GM Financial offers a sub-prime lending program. The program is primarily offered to consumers with a
In North America, GM Financial offers a sub-prime lending program. The program is primarily offered to consumers with a
FICO score or its equivalent of less than 620 who have limited access to automobile financing through banks and credit unions
FICO score or its equivalent of less than 620 who have limited access to automobile financing through banks and credit unions
and is expected to sustain a higher level of credit losses than prime lending.
and is expected to sustain a higher level of credit losses than prime lending.
GM Financial generally seeks to fund its operations in each country through local sources to minimize currency and country
GM Financial generally seeks to fund its operations in each country through local sources to minimize currency and country
risk. GM Financial primarily finances its loan, lease and commercial origination volume through the use of secured and unsecured
risk. GM Financial primarily finances its loan, lease and commercial origination volume through the use of secured and unsecured
credit facilities, through securitization transactions and through the issuance of unsecured debt in public markets.
credit facilities, through securitization transactions and through the issuance of unsecured debt in public markets.
Employees At December 31, 2019 we employed approximately 95,000 (58%) hourly employees and approximately 69,000 (42%)
Employees At December 31, 2019 we employed approximately 95,000 (58%) hourly employees and approximately 69,000(42%)
salaried employees. At December 31, 2019 approximately 48,000 (50%) of our U.S. employees were represented by unions, a
salaried employees. At December 31, 2019 approximately 48,000 (50%) of our U.S. employees were represented by unions, a
majority of which were represented by the International Union, United Automobile, Aerospace and Agriculture Implement Workers
majority of which were represented by the International Union, United Automobile, Aerospace and Agriculture Implement Workers
of America (UAW). The following table summarizes worldwide employment (in thousands):
of America (UAW). The following table summarizes worldwide employment (in thousands):
December 31, 2019
December 31, 2019
GMNA(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
117
GMNA(a) 117
GMI 37
GMI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
37
GM Financial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
GM Financial 10
164
Total Worldwide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Worldwide 164
U.S. - Salaried . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48
U.S. - Salaried 48
48
U.S. - Hourly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. - Hourly 48
__________
(a) Includes Cruise.
(a) Includes Cruise.
8
8
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Information About our Executive Officers As of February 5, 2020 the names and ages of our executive officers and their
Information About our Executive Officers As of February 5, 2020 the names and ages of our executive officers and their
positions with GM are as follows:
positions with GM are as follows:
Name (Age)
Name (Age)
Mary T. Barra (58)
Mary T. Barra (58)
Barry L. Engle (56)
Barry L. Engle (56)
Craig B. Glidden (62)
Craig_ B. Glidden (62)
Christopher T. Hatto (49)
Christopher T. Hatt° (49)
Gerald Johnson (57)
Gerald Johnson (57)
Randall D. Mott (63)
Randall D. Mott (63)
Douglas L. Parks (58)
Douglas L. Parks (58)
Present GM Position (Effective Date)
Present GM Position (Effective Date)
Chairman and Chief Executive
Chairman and Chief Executive
Officer (2016)
Officer (2016)
Executive Vice President and
Executive Vice President and
President, North America (2019)
President, North America (2019)
Executive Vice President and
Executive Vice President and
General Counsel (2015)
General Counsel (2015)
Vice President, Global Business
Vice President, Global Business
Solutions and Chief Accounting
Solutions and Chief Accounting
Officer (2020)
Officer (2020)
Executive Vice President, Global
Executive Vice President, Global
Manufacturing (2019)
Manufacturing (2019)
Executive Vice President, Global
Executive Vice President, Global
Information Technology and Chief
Information Technology and Chief
Information Officer (2019)
Information Officer (2019)
Executive Vice President, Global
Executive Vice President, Global
Product Development, Purchasing
Product Development, Purchasing
and Supply Chain (2019)
and Supply Chain (2019)
Mark L. Reuss (56)
President (2019)
Mark L. Reuss (56) President (2019)
Dhivya Suryadevara (40)
Dhivya Suryadevara (40)
Executive Vice President and
Executive Vice President and
Chief Financial Officer (2018)
Chief Financial Officer (2018)
Matthew Tsien (59)
Matthew Tsien (59)
Executive Vice President and
Executive Vice President and
President, GM China (2014)
President, GM China (2014)
Positions Held During the Past Five Years (Effective Date)
Positions Held During the Past Five Years (Effective Date)
Chief Executive Officer and Member of the Board of Directors
Chief Executive Officer and Member of the Board of Directors
(2014)
(2014)
Executive Vice President and President, The Americas (2019)
Executive Vice President and President, The Americas (2019)
Executive Vice President and President, GM International (2018)
Executive Vice President and President, GM International (2018)
Executive Vice President and President, South America (2015)
Executive Vice President and President, South America (2015)
Agility Fuel Systems, Chief Executive Officer (2011)
Agility Fuel Systems, Chief Executive Officer (2011)
LyondellBasell, Executive Vice President and Chief Legal Officer
LyondellBasell, Executive Vice President and Chief Legal Officer
(2009)
(2009)
Vice President, Controller and Chief Accounting Officer (2018)
Vice President, Controller and Chief Accounting Officer (2018)
Chief Financial Officer, U.S. Sales Operations (2016)
Chief Financial Officer, U.S. Sales Operations (2016)
Chief Financial Officer, Customer Care and Aftersales (2013)
Chief Financial Officer, Customer Care and Aftersales (2013)
Vice President, North America Manufacturing and Labor Relations
Vice President, North America Manufacturing and Labor Relations
(2017)
(2017)
Vice President of Operational Excellence (2014)
Vice President of Operational Excellence (2014)
Senior Vice President, Global Information Technology and Chief
Senior Vice President, Global Information Technology and Chief
Information Officer (2013)
Information Officer (2013)
Vice President, Autonomous and Electric Vehicles (2017)
Vice President, Autonomous and Electric Vehicles (2017)
Vice President, Autonomous Technology and Vehicle Execution
Vice President, Autonomous Technology and Vehicle Execution
(2016)
(2016)
Vice President, Global Product Programs (2012)
Vice President, Global Product Programs (2012)
Executive Vice President and President, Global Product
Executive Vice President and President, Global Product
Development Group and Cadillac (2018)
Development Group and Cadillac (2018)
Executive Vice President, Global Product Development,
Executive Vice President, Global Product Development,
Purchasing & Supply Chain (2014)
Purchasing & Supply Chain (2014)
Vice President, Corporate Finance (2017)
Vice President, Corporate Finance (2017)
Vice President, Finance and Treasurer (2015)
Vice President, Finance and Treasurer (2015)
Chief Executive Officer, GM Asset Management (2013)
Chief Executive Officer, GM Asset Management (2013)
There are no family relationships between any of the officers named above and there is no arrangement or understanding between
There are no family relationships between any of the officers named above and there is no arrangement or understanding between
any of the officers named above and any other person pursuant to which he or she was selected as an officer. Each of the officers
any of the officers named above and any other person pursuant to which he or she was selected as an officer. Each of the officers
named above was elected by the Board of Directors to hold office until his or her successor is elected and qualified or until his or
named above was elected by the Board of Directors to hold office until his or her successor is elected and qualified or until his or
her earlier resignation or removal.
her earlier resignation or removal.
Website Access to Our Reports Our internet website address is www.gm.com. In addition to the information about us and our
Website Access to Our Reports Our internet website address is www.gm.com. In addition to the information about us and our
subsidiaries contained in this 2019 Form 10-K, information about us can be found on our website including information on our
subsidiaries contained in this 2019 Form 10-K, information about us can be found on our website including information on our
corporate governance principles and practices. Our Investor Relations website at https://investor.gm.com contains a significant
corporate governance principles and practices. Our Investor Relations website at https://investor.gm.com contains a significant
amount of information about us, including financial and other information for investors. We encourage investors to visit our website,
amount of information about us, including fmancial and other information for investors. We encourage investors to visit our website,
as we frequently update and post new information about our company on our website and it is possible that this information could
as we frequently update and post new information about our company on our website and it is possible that this information could
be deemed to be material information. Our website and information included in or linked to our website are not part of this 2019
be deemed to be material information. Our website and information included in or linked to our website are not part of this 2019
Form 10-K.
Form 10-K.
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports
Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports
filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act), are
filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act), are
available free of charge through our website as soon as reasonably practicable after they are electronically filed with or furnished
available free of charge through our website as soon as reasonably practicable after they are electronically filed with or furnished
to the Securities and Exchange Commission (SEC).
to the Securities and Exchange Commission (SEC).
* * * * * * *
* * * * * * *
9
9
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Item 1A. Risk Factors
Item IA. Risk Factors
We have listed below the most significant risk factors applicable to us. These risk factors are not necessarily in the order of
We have listed below the most significant risk factors applicable to us. These risk factors are not necessarily in the order of
importance or probability of occurrence:
importance or probability of occurrence:
If we do not deliver new products, services and customer experiences in response to increased competition in the automotive
If we do not deliver new products, services and customer experiences in response to increased competition in the automotive
industry, our business could suffer. We believe that the automotive industry will continue to experience significant change in the
industry, our business could suffer. We believe that the automotive industry will continue to experience significant change in the
coming years. In addition to our traditional competitors, we must also be responsive to the entrance of non-traditional participants
coming years. In addition to our traditional competitors, we must also be responsive to the entrance of non-traditional participants
in the automotive industry. Industry participants are disrupting the historic business model of our industry through the introduction
in the automotive industry. Industry participants are disrupting the historic business model of our industry through the introduction
of new technologies, products, services and methods of travel and vehicle ownership. It is strategically significant that we succeed
of new technologies, products, services and methods of travel and vehicle ownership. It is strategically significant that we succeed
in leading the technological disruption occurring in our industry, including consumer adoption of electric vehicles and
in leading the technological disruption occurring in our industry, including consumer adoption of electric vehicles and
commercialization of autonomous vehicles in a rideshare environment. To successfully execute our long-term strategy, we must
commercialization of autonomous vehicles in a rideshare environment. To successfully execute our long-term strategy, we must
continue to develop new products and services, including products and services that are outside of our historically core business,
continue to develop new products and services, including products and services that are outside of our historically core business,
such as autonomous and electric vehicles, digital services and transportation as a service. The process of designing and developing
such as autonomous and electric vehicles, digital services and transportation as a service. The process of designing and developing
new technology, products and services is complex, costly and uncertain and requires extensive capital investment and the abilitytt
new technology, products and services is complex, costly and uncertain and requires extensive capital investment and the ability
to retain and recruit talent. There can be no assurance that advances in technology will occur in a timely or feasible way, or that
to retain and recruit talent. There can be no assurance that advances in technology will occur in a timely or feasible way, or that
others will not acquire similar or superior technologies sooner than we do or that we will acquire technologies on an exclusive
others will not acquire similar or superior technologies sooner than we do or that we will acquire technologies on an exclusive
basis or at a significant price advantage. If we do not adequately prepare for and respond to new kinds of technological innovations,
basis or at a significant price advantage. If we do not adequately prepare for and respond to new kinds of technological innovations,
market developments and changing customer needs, our sales, profitability and long-term competitiveness may be harmed.
market developments and changing customer needs, our sales, profitability and long-term competitiveness may be harmed.
dd
Our ability to maintain profitability is dependent upon our ability to timely fund and introduce new and improved vehicle
Our ability to maintain profitability is dependent upon our ability to timely fund and introduce new and improved vehicle
models that are able to attract a sufficient number of consumers. We operate in a very competitive industry with market
models that are able to attract a sufficient number of consumers. We operate in a very competitive industry with market
participants routinely introducing new and improved vehicle models and features designed to meet rapidly evolving consumer
participants routinely introducing new and improved vehicle models and features designed to meet rapidly evolving consumer
expectations. Producing new and improved vehicle models that preserve our reputation for designing, building and selling safe,
expectations. Producing new and improved vehicle models that preserve our reputation for designing, building and selling safe,
high-quality cars and trucks is critical to our long-term profitability. Successful launches of our new vehicles are critical to our
high-quality cars and trucks is critical to our long-term profitability. Successful launches of our new vehicles are critical to our
short-term profitability. It generally takes two years or more to design and develop a new vehicle, and a number of factors may
short-term profitability. It generally takes two years or more to design and develop a new vehicle, and a number of factors may
lengthen that time period. Because of this product development cycle and the various elements that may contribute to consumers’
lengthen that time period. Because of this product development cycle and the various elements that may contribute to consumers'
acceptance of new vehicle designs, including competitors’ product introductions, technological innovations, fuel prices, general
acceptance of new vehicle designs, including competitors' product introductions, technological innovations, fuel prices, general
economic conditions and changes in quality, safety, reliability and styling demands and preferences, an initial product concept or
economic conditions and changes in quality, safety, reliability and styling demands and preferences, an initial product concept or
design may not result in a vehicle that generates sales in sufficient quantities and at high enough prices to be profitable. Our high
design may not result in a vehicle that generates sales in sufficient quantities and at high enough prices to be profitable. Our high
proportion of fixed costs, both due to our significant investment in property, plant and equipment as well as other requirements of
proportion of fixed costs, both due to our significant investment in property, plant and equipment as well as other requirements of
our collective bargaining agreements, which limit our flexibility to adjust personnel costs to changes in demands for our products,
our collective bargaining agreements, which limit our flexibility to adjust personnel costs to changes in demands for our products,
may further exacerbate the risks associated with incorrectly assessing demand for our vehicles.
may further exacerbate the risks associated with incorrectly assessing demand for our vehicles.
uu
t
Our profitability is dependent upon the success of SUVs and full-size pick-up trucks. While we offer a portfolio of cars,
Our profitability is dependent upon the success of SUVs and full-size pick-up trucks. While we offer a portfolio of cars,
crossovers, SUVs and trucks, we generally recognize higher profit margins on our SUVs and trucks. Our success is dependent
crossovers, SUVs and trucks, we generally recognize higher profit margins on our SUVs and trucks. Our success is dependent
upon our ability to sell higher margin vehicles in sufficient volumes. Any shift in consumer preferences toward smaller, more fuel-
upon our ability to sell higher margin vehicles in sufficient volumes. Any shift in consumer preferences toward smaller, more fuel-
efficient vehicles, whether as a result of increases in the price of oil or any sustained shortage of oil, including as a result of global
efficient vehicles, whether as a result of increases in the price of oil or any sustained shortage of oil, including as a result of global
political instability, or other reasons, could weaken the demand for our higher margin vehicles. More stringent fuel economy
political instability, or other reasons, could weaken the demand for our higher margin vehicles. More stringent fuel economy
regulations could also impact our ability to sell these vehicles.
regulations could also impact our ability to sell these vehicles.
ff
We may continue to restructure our operations in the U.S. and various other countries and initiate additional cost reduction
We may continue to restructure our operations in the U.S. and various other countries and initiate additional cost reduction
actions, but we may not succeed in doing so. Since 2017, we have undertaken restructuring actions to lower our operating costs
actions, but we may not succeed in doing so. Since 2017, we have undertaken restructuring actions to lower our operating costs
in response to difficult market and operating conditions in various parts of the world, including the U.S., Canada, Korea and Europe.
in response to difficult market and operating conditions in various parts of the world, including the U.S., Canada, Korea and Europe.
As we continue to assess our performance throughout our regions, we may take additional restructuring actions to rationalize our uu
As we continue to assess our performance throughout our regions, we may take additional restructuring actions to rationalize our
operations, which may result in material asset write-downs or impairments and reduce our profitability in the periods incurred. In
operations, which may result in material asset write-downs or impairments and reduce our profitability in the periods incurred. In
addition, we are continuing to implement a number of operating effectiveness initiatives to improve productivity and reduce costs.
addition, we are continuing to implement a number of operating effectiveness initiatives to improve productivity and reduce costs.
For example, we are continuing to execute on the transformation actions we announced in 2018 to drive significant cost efficiencies
For example, we are continuing to execute on the transformation actions we announced in 2018 to drive significant cost efficiencies
and realign our current manufacturing capacity with demand. While we have achieved significant cost savings, there is no guarantee
and realign our current manufacturing capacity with demand. While we have achieved significant cost savings, there is no guarantee
that we will fully realize the anticipated savings or benefits from past or future restructuring and/or cost reduction actions within
that we will fully realize the anticipated savings or benefits from past or future restructuring and/or cost reduction actions within
the time periods we expect or at all. In addition, these restructuring actions subject us to increased risks of labor unrest or strikes,
the time periods we expect or at all. In addition, these restructuring actions subject us to increased risks of labor unrest or strikes,
supplier, dealer, or other third-party litigation, regulator claims or proceedings, negative publicity and business disruption. Failure
supplier, dealer, or other third-party litigation, regulator claims or proceedings, negative publicity and business disruption. Failure
to realize anticipated savings or benefits from our restructuring and/or cost reduction actions could have a material adverse effect
to realize anticipated savings or benefits from our restructuring and/or cost reduction actions could have a material adverse effect
on our business, prospects, financial condition, liquidity, results of operations and cash flows.
on our business, prospects, fmancial condition, liquidity, results of operations and cash flows.
r
Our electric vehicle strategy is dependent upon our ability to reduce the cost of manufacturing electric vehicles, as well as
Our electric vehicle strategy is dependent upon our ability to reduce the cost of manufacturing electric vehicles, as well as
increased consumer adoption. We anticipate that the production and profitable sale of electric vehicles will become increasingly
increased consumer adoption. We anticipate that the production and profitable sale of electric vehicles will become increasingly
10
10
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
important to our business. If we are unable to reduce the costs associated with the manufacture of battery-electric vehicles, it may
important to our business. If we are unable to reduce the costs associated with the manufacture of battery-electric vehicles, it may
negatively impact our earnings and financial condition. Our ability to benefit from certain government and economic incentives
negatively impact our earnings and financial condition. Our ability to benefit from certain government and economic incentives
supporting the development and sale of electric vehicles has been reduced and, in some jurisdictions, eliminated or exhausted,
supporting the development and sale of electric vehicles has been reduced and, in some jurisdictions, eliminated or exhausted,
which may negatively affect our ability to profitably sell electric vehicles. In addition, our sale of electric vehicles is dependent
which may negatively affect our ability to profitably sell electric vehicles. In addition, our sale of electric vehicles is dependent
on consumer adoption, which could be impacted by numerous factors, including perceptions about electric vehicle features, quality,
on consumer adoption, which could be impacted by numerous factors, including perceptions about electric vehicle features, quality,
safety, performance and cost; perceptions about the range over which electric vehicles may be driven on a single battery charge;
safety, performance and cost; perceptions about the range over which electric vehicles may be driven on a single battery charge;
high fuel-economy internal combustion engine vehicles; volatility in the cost of fuel; government regulations and economic
high fuel-economy internal combustion engine vehicles; volatility in the cost of fuel; government regulations and economic
incentives; and access to charging facilities.
incentives; and access to charging facilities.
Our autonomous vehicle strategy is dependent upon our ability to successfully mitigate unique technological, operational,
Our autonomous vehicle strategy is dependent upon our ability to successfully mitigate unique technological, operational,
and regulatory risks. In recent years, we announced significant investments in autonomous vehicle technologies, including in
and regulatory risks. In recent years, we announced significant investments in autonomous vehicle technologies, including in
GM Cruise Holdings LLC (Cruise Holdings), our majority-owned subsidiary that is responsible for the development and
GM Cruise Holdings LLC (Cruise Holdings), our majority-owned subsidiary that is responsible for the development and
commercialization of autonomous vehicle technology. Our autonomous vehicle operations are capital intensive and subject to a
commercialization of autonomous vehicle technology. Our autonomous vehicle operations are capital intensive and subject to a
variety of risks inherent with the development of new technologies, including our ability to continue to develop self-driving software
variety of risks inherent with the development ofnew technologies, including our ability to continue to develop self-driving software
and hardware, such as Light Detection and Ranging (LiDAR) sensors and other components; access to sufficient capital, including
and hardware, such as Light Detection and Ranging (LiDAR) sensors and other components; access to sufficient capital, including
with respect to additional Softbank funding; risks related to the manufacture of purpose-built autonomous vehicles; and significant
with respect to additional Softbank funding; risks related to the manufacture of purpose-built autonomous vehicles; and significant
competition from both established automotive companies and technology companies, some of which may have more resources
competition from both established automotive companies and technology companies, some of which may have more resources
and capital to devote to autonomous vehicle technologies than we do. In addition, we face risks related to the commercial deployment
and capital to devote to autonomous vehicle technologies than we do. In addition, we face risks related to the commercial deployment
of autonomous vehicles on our targeted timeline or at all, including consumer acceptance, achievement of adequate safety and
of autonomous vehicles on our targeted timeline or at all, including consumer acceptance, achievement of adequate safety and
other performance standards and compliance with uncertain, evolving and potentially conflicting federal and state or provincial
other performance standards and compliance with uncertain, evolving and potentially conflicting federal and state or provincial
regulations. To the extent accidents, cybersecurity breaches or other adverse events associated with our autonomous driving systems
regulations. To the extent accidents, cybersecurity breaches or other adverse events associated with our autonomous driving systems
occur, we could be subject to liability, government scrutiny and further regulation. Any of the foregoing could materially and
occur, we could be subject to liability, government scrutiny and further regulation. Any of the foregoing could materially and
adversely affect our results of operations, financial condition and growth prospects.
adversely affect our results of operations, financial condition and growth prospects.
Our business is highly dependent upon global automobile market sales volume, which can be volatile. Because we have a
Our business is highly dependent upon global automobile market sales volume, which can be volatile Because we have a
high proportion of relatively fixed structural costs, small changes in sales volume can have a disproportionately large effect on
high proportion of relatively fixed structural costs, small changes in sales volume can have a disproportionately large effect on
our profitability. A number of economic and market conditions drive changes in vehicle sales, including real estate values, the
our profitability. A number of economic and market conditions drive changes in vehicle sales, including real estate values, the
availability and prices of used vehicles, levels of unemployment, availability of affordable financing, fluctuations in the cost of
availability and prices of used vehicles, levels of unemployment, availability of affordable fmancing, fluctuations in the cost of
fuel, consumer confidence, political unrest, the occurrence of a contagious disease or illness, such as the novel coronavirus, barriers
fuel, consumer confidence, political unrest, the occurrence of a contagious disease or illness, such as the novel coronavirus, barriers
to trade and other global economic conditions. While we cannot predict future economic and market conditions with certainty, we
to trade and other global economic conditions. While we cannot predict future economic and market conditions with certainty, we
expect U.S. and China industry sales volumes to be lower in 2020 relative to 2019. For a discussion of economic and market trends,
expect U.S. and China industry sales volumes to be lower in 2020 relative to 2019. For a discussion of economic and market trends,
see the Overview section of the MD&A.
see the Overview section of the MD&A.
Our significant business in China subjects us to unique operational, competitive and regulatory risks. Maintaining a strong
Our significant business in China subjects us to unique operational, competitive and regulatory risks. Maintaining a strong
position in the Chinese market is a key component of our global growth strategy. Our business in China is subject to aggressive
position in the Chinese market is a key component of our global growth strategy. Our business in China is subject to aggressive
competition from many of the largest global manufacturers and numerous domestic manufacturers as well as non-traditional market
competition from many of the largest global manufacturers and numerous domestic manufacturers as well as non-traditional market
participants, such as domestic technology companies. In addition, our success in China depends upon our ability to adequately
participants, such as domestic technology companies. In addition, our success in China depends upon our ability to adequately
address unique market and consumer preferences driven by advancements related to infotainment and other new technologies.
address unique market and consumer preferences driven by advancements related to infotainment and other new technologies.
Increased competition, increased U.S.-China trade restrictions and weakening economic conditions in China, among other things,
Increased competition, increased U.S.-China trade restrictions and weakening economic conditions in China, among other things,
may result in price reductions, reduced sales, profitability and margins, and challenges to gain or hold market share. Chinese
may result in price reductions, reduced sales, profitability and margins, and challenges to gain or hold market share. Chinese
regulators have implemented increasingly aggressive “green” policy initiatives and recommended quotas for the sale of electric
regulators have implemented increasingly aggressive "green" policy initiatives and recommended quotas for the sale of electric
vehicles, which have challenging lead times.
vehicles, which have challenging lead times.
Certain risks and uncertainties of doing business in China are solely within the control of the Chinese government, and Chinese
Certain risks and uncertainties of doing business in China are solely within the control of the Chinese government, and Chinese
law regulates the scope of our investments and business conducted within China. In order to maintain access to the Chinese market,
law regulates the scope of our investments and business conducted within China. In order to maintain access to the Chinese market,
we may be required to comply with significant technical and other regulatory requirements that are unique to the Chinese market,
we may be required to comply with significant technical and other regulatory requirements that are unique to the Chinese market,
at times with challenging lead times to implement such requirements. These actions may increase the cost of doing business in
at times with challenging lead times to implement such requirements. These actions may increase the cost of doing business in
China and reduce our profitability.
China and reduce our profitability.
A significant amount of our operations are conducted by joint ventures that we cannot operate solely for our benefit. Many
A significant amount of our operations are conducted by joint ventures that we cannot operate solely for our benefit. Many
of our operations, primarily in China and Korea, are carried out by joint ventures. In joint ventures we share ownership and
of our operations, primarily in China and Korea, are carried out by joint ventures. In joint ventures we share ownership and
management of a company with one or more parties who may not have the same goals, strategies, priorities or resources as we do
management of a company with one or more parties who may not have the same goals, strategies, priorities or resources as we do
and may compete with us outside the joint venture. Joint ventures are intended to be operated for the equal benefit of all co-owners,
and may compete with us outside the joint venture. Joint ventures are intended to be operated for the equal benefit of all co-owners,
rather than for our exclusive benefit. Operating a business as a joint venture often requires additional organizational formalities
rather than for our exclusive benefit. Operating a business as a joint venture often requires additional organizational formalities
as well as time-consuming procedures for sharing information and making decisions that must further take into consideration our
as well as time-consuming procedures for sharing information and making decisions that must further take into consideration our
partners' interests. In joint ventures we are required to foster our relationships with our co-owners as well as promote the overall
partners' interests. In joint ventures we are required to foster our relationships with our co-owners as well as promote the overall
success of the joint venture, and if a co-owner changes, relationships deteriorate or strategic objectives diverge, our success in the
success of the joint venture, and if a co-owner changes, relationships deteriorate or strategic objectives diverge, our success in the
11
11
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
joint venture may be materially adversely affected. The benefits from a successful joint venture are shared among the co-owners,
joint venture may be materially adversely affected. The benefits from a successful joint venture are shared among the co-owners,
therefore we do not receive all the benefits from our successful joint ventures.
therefore we do not receive all the benefits from our successful joint ventures.
In addition, because we share ownership and management with one or more parties, we may have limited control over the actions
In addition, because we share ownership and management with one or more parties, we may have limited control over the actions
of a joint venture, particularly when we own a minority interest. As a result, we may be unable to prevent violations of applicable
of a joint venture, particularly when we own a minority interest. As a result, we may be unable to prevent violations of applicable
laws or other misconduct by a joint venture or the failure to satisfy contractual obligations by one or more parties. Moreover, a
laws or other misconduct by a joint venture or the failure to satisfy contractual obligations by one or more parties. Moreover, a
joint venture may not follow the same requirements regarding compliance, internal controls and internal control over financial
joint venture may not follow the same requirements regarding compliance, internal controls and internal control over financial
reporting that we follow. To the extent another party makes decisions that negatively impact the joint venture or internal control
reporting that we follow. To the extent another party makes decisions that negatively impact the joint venture or internal control
issues arise within the joint venture, we may have to take responsive or other actions or we may be subject to penalties, fines or
issues arise within the joint venture, we may have to take responsive or other actions or we may be subject to penalties, fmes or
other related actions for these activities.
other related actions for these activities.
tt
The international scale and footprint of our operations expose us to additional risks. We manufacture, sell and service products
The international scale and footprint of our operations expose us to additional risks. We manufacture, sell and service products
globally and rely upon an integrated global supply chain to deliver the raw materials, components, systems and parts that we need
globally and rely upon an integrated global supply chain to deliver the raw materials, components, systems and parts that we need
to manufacture our products. Our global operations subject us to extensive domestic and foreign legal and regulatory requirements,
to manufacture our products. Our global operations subject us to extensive domestic and foreign legal and regulatory requirements,
and a variety of other political, economic and regulatory risks including: (1) changes in government leadership; (2) changes in
and a variety of other political, economic and regulatory risks including: (1) changes in government leadership; (2) changes in
labor, employment, tax, privacy, environmental and other laws, regulations or government policies impacting our overall business
labor, employment, tax, privacy, environmental and other laws, regulations or government policies impacting our overall business
model or practices or restricting our ability to manufacture, purchase or sell products consistent with market demand and our
model or practices or restricting our ability to manufacture, purchase or sell products consistent with market demand and our
business objectives; (3) political pressures to change any aspect of our business model or practices or that impair our ability toy
business objectives; (3) political pressures to change any aspect of our business model or practices or that impair our ability to
source raw materials, services, components, systems and parts, or manufacture products on competitive terms in a manner consistent
source raw materials, services, components, systems and parts, or manufacture products on competitive terms in a manner consistent
with our business objectives; (4) political instability, civil unrest or government controls over certain sectors; (5) political and
with our business objectives; (4) political instability, civil unrest or government controls over certain sectors; (5) political and
economic tensions between governments and changes in international trade policies, including restrictions on the repatriation of
economic tensions between governments and changes in international trade policies, including restrictions on the repatriation of
dividends, especially between China or Canada and the U.S.; (6) more detailed inspections or new or higher tariffs, for example,
dividends, especially between China or Canada and the U.S.; (6) more detailed inspections or new or higher tariffs, for example,
on products imported into or exported from the U.S., including under Section 232 of the Trade Expansion Act of 1962, Section
on products imported into or exported from the U.S., including under Section 232 of the Trade Expansion Act of 1962, Section
301 of the U.S. Trade Act of 1974, or other trade measures; (7) new barriers to entry or domestic preference procurement
301 of the U.S. Trade Act of 1974, or other trade measures; (7) new barriers to entry or domestic preference procurement
requirements, including changes to, withdrawals from or impediments to implementing free trade agreements (for example, the
requirements, including changes to, withdrawals from or impediments to implementing free trade agreements (for example, the
North American Free Trade Agreement or its successor, the United States-Mexico-Canada Agreement), or preferences of foreign
North American Free Trade Agreement or its successor, the United States-Mexico-Canada Agreement), or preferences of foreign
nationals for domestically manufactured products; (8) changes in foreign currency exchange rates, particularly in Brazil and
nationals for domestically manufactured products; (8) changes in foreign currency exchange rates, particularly in Brazil and
Argentina, and interest rates; (9) economic downturns in foreign countries or geographic regions where we have significant
Argentina, and interest rates; (9) economic downturns in foreign countries or geographic regions where we have significant
operations, or significant changes in conditions in the countries in which we operate; (10) differing local product preferences and
operations, or significant changes in conditions in the countries in which we operate; (10) differing local product preferences and
product requirements, including government certification requirements related to, among other things, fuel economy, vehicle
product requirements, including government certification requirements related to, among other things, fuel economy, vehicle
emissions and safety; (11) impact of compliance with U.S. and foreign countries’ export controls and economic sanctions; (12)
emissions and safety; (11) impact of compliance with U.S. and foreign countries' export controls and economic sanctions; (12)
liabilities resulting from U.S. and foreign laws and regulations, including, but not limited to, those related to the Foreign Corrupt
liabilities resulting from U.S. and foreign laws and regulations, including, but not limited to, those related to the Foreign Corrupt
Practices Act and certain other anti-corruption laws; (13) differing labor regulations, requirements and union relationships; (14)
Practices Act and certain other anti-corruption laws; (13) differing labor regulations, requirements and union relationships; (14)
differing dealer and franchise regulations and relationships; (15) difficulties in obtaining financing in foreign countries for local
differing dealer and franchise regulations and relationships; (15) difficulties in obtaining fmancing in foreign countries for local
operations; and (16) natural disasters, public health crises, including the occurrence of a contagious disease or illness, such as the
operations; and (16) natural disasters, public health crises, including the occurrence of a contagious disease or illness, such as the
novel coronavirus, and other catastrophic events.
novel coronavirus, and other catastrophic events.
r
h
Any significant disruption at one of our manufacturing facilities could disrupt our production schedule. We assemble vehicles
Any significant disruption at one ofour manufacturing facilities could disrupt our production schedule. We assemble vehicles
at various facilities around the world. Our facilities are typically designed to produce particular models for particular geographic
at various facilities around the world. Our facilities are typically designed to produce particular models for particular geographic
markets. No single facility is designed to manufacture our full range of vehicles. In some cases, certain facilities produce products,
markets. No single facility is designed to manufacture our full range of vehicles. In some cases, certain facilities produce products,
systems, components and parts that disproportionately contribute a greater degree to our profitability than others and create
systems, components and parts that disproportionately contribute a greater degree to our profitability than others and create
significant interdependencies among manufacturing facilities around the world. Should these or other facilities become unavailable
significant interdependencies among manufacturing facilities around the world. Should these or other facilities become unavailable
either temporarily or permanently for any number of reasons, including labor disruptions, the occurrence of a contagious disease
either temporarily or permanently for any number of reasons, including labor disruptions, the occurrence of a contagious disease
or illness, such as the novel coronavirus, or catastrophic weather events, the inability to manufacture at the affected facility may
or illness, such as the novel coronavirus, or catastrophic weather events, the inability to manufacture at the affected facility may
result in harm to our reputation, increased costs, lower revenues and the loss of customers. In particular, substantially all of our
result in harm to our reputation, increased costs, lower revenues and the loss of customers. In particular, substantially all of our
hourly employees are represented by unions and covered by collective bargaining agreements that must be negotiated from time-
hourly employees are represented by unions and covered by collective bargaining agreements that must be negotiated from time-
to-time, often at the local facility level, which increases our risk of work stoppages. We may not be able to easily shift production
to-time, often at the local facility level, which increases our risk of work stoppages. We may not be able to easily shift production
to other facilities or to make up for lost production. Any new facility needed to replace an inoperable manufacturing facility would
to other facilities or to make up for lost production. Any new facility needed to replace an inoperable manufacturing facility would
need to comply with the necessary regulatory requirements, need to satisfy our specialized manufacturing requirements and require
need to comply with the necessary regulatory requirements, need to satisfy our specialized manufacturing requirements and require
specialized equipment.
specialized equipment.
dd
a
tt
Any disruption in our suppliers’ operations could disrupt our production schedule. Our automotive operations are dependent
Any disruption in our suppliers' operations could disrupt our production schedule. Our automotive operations are dependent
upon the continued ability of our suppliers to deliver the systems, components, raw materials and parts that we need to manufacture
upon the continued ability of our suppliers to deliver the systems, components, raw materials and parts that we need to manufacture
our products. Our use of “just-in-time” manufacturing processes allows us to maintain minimal inventory. As a result, our ability
our products. Our use of "just-in-time" manufacturing processes allows us to maintain minimal inventory. As a result, our ability
to maintain production is dependent upon our suppliers delivering sufficient quantities of systems, components, raw materials and
to maintain production is dependent upon our suppliers delivering sufficient quantities of systems, components, raw materials and
parts on time to meet our production schedules. In some instances, we purchase systems, components, raw materials and parts that
parts on time to meet our production schedules. In some instances, we purchase systems, components, raw materials and parts that
are ultimately derived from a single source and may be at an increased risk for supply disruptions. Any number of factors, including
are ultimately derived from a single source and may be at an increased risk for supply disruptions. Any number of factors, including
aa
12
12
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
labor disruptions, catastrophic weather events, the occurrence of a contagious disease or illness, such as the novel coronavirus,
labor disruptions, catastrophic weather events, the occurrence of a contagious disease or illness, such as the novel coronavirus,
contractual or other disputes, unfavorable economic or industry conditions, delivery delays or other performance problems or
contractual or other disputes, unfavorable economic or industry conditions, delivery delays or other performance problems or
financial difficulties or solvency problems, could disrupt our suppliers’ operations and lead to uncertainty in our supply chain or
fmancial difficulties or solvency problems, could disrupt our suppliers' operations and lead to uncertainty in our supply chain or
cause supply disruptions for us, which could, in turn, disrupt our operations, including the production of certain higher margin
cause supply disruptions for us, which could, in turn, disrupt our operations, including the production of certain higher margin
vehicles. In particular, if the current novel coronavirus outbreak continues and results in a prolonged period of travel, commercial
vehicles. In particular, if the current novel coronavirus outbreak continues and results in a prolonged period of travel, commercial
and other similar restrictions, we could experience global supply disruptions. If we experience supply disruptions, we may not be
and other similar restrictions, we could experience global supply disruptions. If we experience supply disruptions, we may not be
able to develop alternate sourcing quickly. Any disruption of our production schedule caused by an unexpected shortage of systems,
able to develop alternate sourcing quickly. Any disruption of our production schedule caused by an unexpected shortage of systems,
components, raw materials or parts even for a relatively short period of time could cause us to alter production schedules or suspend
components, raw materials or parts even for a relatively short period of time could cause us to alter production schedules or suspend
production entirely, which could cause a loss of revenues, which would adversely affect our operations.
production entirely, which could cause a loss of revenues, which would adversely affect our operations.
ii
High prices of raw materials or other inputs used by us and our suppliers could negatively impact our profitability. Increases
High prices of raw materials or other inputs used by us and our suppliers could negatively impact our profitability. Increases
in prices for raw materials or other inputs that we and our suppliers use in manufacturing products, systems, components and parts,
in prices for raw materials or other inputs that we and our suppliers use in manufacturing products, systems, components and parts,
such as steel, precious metals, or non-ferrous metals, including aluminum, copper and plastic, may lead to higher production costs
such as steel, precious metals, or non-ferrous metals, including aluminum, copper and plastic, may lead to higher production costs
for parts, components and vehicles. Changes in trade policies and tariffs, fluctuations in supply and demand and other economic
for parts, components and vehicles. Changes in trade policies and tariffs, fluctuations in supply and demand and other economic
and political factors may continue to create pricing pressure for raw materials and other inputs. This could, in turn, negatively
and political factors may continue to create pricing pressure for raw materials and other inputs. This could, in turn, negatively
impact our future profitability because we may not be able to pass all of those costs on to our customers or require our suppliers
impact our future profitability because we may not be able to pass all of those costs on to our customers or require our suppliers
to absorb such costs.
to absorb such costs.
We operate in a highly competitive industry that has excess manufacturing capacity and attempts by our competitors to sell
We operate in a highly competitive industry that has excess manufacturing capacity and attempts by our competitors to sell
more vehicles could have a significant negative effect on our vehicle pricing, market share and operating results. The global
more vehicles could have a significant negative effect on our vehicle pricing, market share and operating results. The global
automotive industry is highly competitive in terms of the quality, innovation, new technologies, pricing, fuel economy, reliability,
automotive industry is highly competitive in terms of the quality, innovation, new technologies, pricing, fuel economy, reliability,
safety, customer service and financial services offered. Additionally, overall manufacturing capacity in the industry far exceeds
safety, customer service and fmancial services offered. Additionally, overall manufacturing capacity in the industry far exceeds
current demand. Many manufacturers, including GM, have relatively high fixed labor costs as well as limitations on their abilitytt
current demand. Many manufacturers, including GM, have relatively high fixed labor costs as well as limitations on their ability
to close facilities and reduce fixed costs. In light of such excess capacity and high fixed costs, many of our competitors have
to close facilities and reduce fixed costs. In light of such excess capacity and high fixed costs, many of our competitors have
attempted to sell more vehicles by providing subsidized financing or leasing programs, offering marketing incentives or reducing
attempted to sell more vehicles by providing subsidized fmancing or leasing programs, offering marketing incentives or reducing
vehicle prices. As a result, we may be required to offer similar incentives, which may not necessarily allow us to set vehicle prices
vehicle prices. As a result, we may be required to offer similar incentives, which may not necessarily allow us to set vehicle prices
that offset cost increases or the impact of adverse currency fluctuations. Our competitors may also seek to benefit from economies
that offset cost increases or the impact of adverse currency fluctuations. Our competitors may also seek to benefit from economies
of scale by consolidating or entering into other strategic agreements such as alliances or joint ventures intended to enhance their
of scale by consolidating or entering into other strategic agreements such as alliances or joint ventures intended to enhance their
competitiveness.
competitiveness.
t
Manufacturers in countries that have lower production costs, such as China and India, have become competitors in key emerging
Manufacturers in countries that have lower production costs, such as China and India, have become competitors in key emerging
markets and announced their intention to export their products to established markets as a low-cost alternative to established entry-
markets and announced their intention to export their products to established markets as a low-cost alternative to established entry-
level automobiles. In addition, foreign governments may decide to implement tax and other policies that favor their domestic
level automobiles. In addition, foreign governments may decide to implement tax and other policies that favor their domestic
manufacturers at the expense of international manufacturers, including GM and its joint venture partners. These actions have had,
manufacturers at the expense of international manufacturers, including GM and its joint venture partners. These actions have had,
and are expected to continue to have, a significant negative effect on our vehicle pricing, market share and operating results.
and are expected to continue to have, a significant negative effect on our vehicle pricing, market share and operating results.
Competitors may independently develop products and services similar to ours, and there are no guarantees that GM’s
Competitors may independently develop products and services similar to ours, and there are no guarantees that GM's
intellectual property rights would prevent competitors from independently developing or selling those products and services.
intellectual property rights would prevent competitors from independently developing or selling those products and services.
There may be instances where, notwithstanding our intellectual property position, competitive products or services may impact
There may be instances where, notwithstanding our intellectual property position, competitive products or services may impact
the value of our brands and other intangible assets, and our business may be adversely affected. Moreover, although GM takes
the value of our brands and other intangible assets, and our business may be adversely affected. Moreover, although GM takes
reasonable steps to maintain the confidentiality of GM proprietary information, there can be no assurance that such efforts will
reasonable steps to maintain the confidentiality of GM proprietary information, there can be no assurance that such efforts will
completely deter or prevent misappropriation or improper use of our technology. We sometimes face attempts to gain unauthorized
completely deter or prevent misappropriation or improper use of our technology. We sometimes face attempts to gain unauthorized
access to our information technology networks and systems for the purpose of improperly acquiring our trade secrets or confidential
access to our information technology networks and systems for the purpose of improperly acquiring our trade secrets or confidential
business information. The theft or unauthorized use or publication of our trade secrets and other confidential business information
business information. The theft or unauthorized use or publication of our trade secrets and other confidential business information
as a result of such an incident could adversely affect our competitive position. In addition, we may be the target of patent enforcement
as a result of such an incident could adversely affect our competitive position. In addition, we may be the target ofpatent enforcement
actions by third parties, including aggressive and opportunistic enforcement claims by non-practicing entities. Regardless of the
actions by third parties, including aggressive and opportunistic enforcement claims by non-practicing entities. Regardless of the
merit of such claims, responding to infringement claims can be expensive and time-consuming. Although we have taken steps to
merit of such claims, responding to infringement claims can be expensive and time-consuming. Although we have taken steps to
mitigate such risks, if we are found to have infringed any third-party rights, we could be required to pay substantial damages or
mitigate such risks, if we are found to have infringed any third-party rights, we could be required to pay substantial damages or
we could be enjoined from offering some of our products and services.
we could be enjoined from offering some of our products and services.
t
Security breaches and other disruptions to information technology systems and networked products, including connected
Security breaches and other disruptions to information technology systems and networked products, including connected
vehicles, owned or maintained by us, GM Financial, or third-party vendors or suppliers on our behalf, could interfere with our
vehicles, owned or maintained by us, GM Financial, or third-party vendors or suppliers on our behalf could interfere with our
operations and could compromise the confidentiality of private customer data or our proprietary information. We rely upon
operations and could compromise the confidentiality of private customer data or our proprietary information. We rely upon
information technology systems and manufacture networked products, some of which are managed by third parties, to process,
information technology systems and manufacture networked products, some of which are managed by third parties, to process,
transmit and store electronic information, and to manage or support a variety of our business processes, activities and products.
transmit and store electronic information, and to manage or support a variety of our business processes, activities and products.
Additionally, we and GM Financial collect and store sensitive data, including intellectual property and proprietary business
Additionally, we and GM Financial collect and store sensitive data, including intellectual property and proprietary business
information (including that of our dealers and suppliers), as well as personally identifiable information of our customers and
information (including that of our dealers and suppliers), as well as personally identifiable information of our customers and
13
13
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
employees, in data centers and on information technology networks (including networks that may be controlled or maintained by
employees, in data centers and on information technology networks (including networks that may be controlled or maintained by
third parties). The secure operation of these systems and products, and the processing and maintenance of the information processed
third parties). The secure operation of these systems and products, and the processing and maintenance of the information processed
by these systems and products, is critical to our business operations and strategy. Further, customers using our systems rely on the
by these systems and products, is critical to our business operations and strategy. Further, customers using our systems rely on the
security of our infrastructure, including hardware and other elements provided by third parties, to ensure the reliability of our
security of our infrastructure, including hardware and other elements provided by third parties, to ensure the reliability of our
products and the protection of their data. Despite security measures and business continuity plans, these systems and products may
products and the protection of their data. Despite security measures and business continuity plans, these systems and products may
be vulnerable to damage, disruptions or shutdowns caused by attacks by hackers, computer viruses, malware (including
be vulnerable to damage, disruptions or shutdowns caused by attacks by hackers, computer viruses, malware (including
“ransomware”), phishing attacks or breaches due to errors or malfeasance by employees, contractors and others who have access
"ransomware"), phishing attacks or breaches due to errors or malfeasance by employees, contractors and others who have access
to these systems and products. The occurrence of any of these events could compromise the confidentiality, operational integritytt
to these systems and products. The occurrence of any of these events could compromise the confidentiality, operational integrity
and accessibility of these systems and products and the data that resides therein. Similarly, such an occurrence could result in the
and accessibility of these systems and products and the data that resides therein. Similarly, such an occurrence could result in the
compromise or loss of the information processed by these systems and products. Such events could result in, among other things,
compromise or loss of the information processed by these systems and products. Such events could result in, among other things,
the loss of proprietary data, interruptions or delays in our business operations and damage to our reputation. In addition, such
the loss of proprietary data, interruptions or delays in our business operations and damage to our reputation. In addition, such
events could cause us to be non-compliant with applicable laws or regulations, subject us to legal claims or proceedings, liability
events could cause us to be non-compliant with applicable laws or regulations, subject us to legal claims or proceedings, liability
or regulatory penalties under laws protecting the privacy of personal information; disrupt operations; or reduce the competitive
or regulatory penalties under laws protecting the privacy of personal information; disrupt operations; or reduce the competitive
advantage we hope to derive from our investment in advanced technologies. We have experienced such events in the past and,
advantage we hope to derive from our investment in advanced technologies. We have experienced such events in the past and,
although past events were immaterial, future events may occur and may be material.
although past events were immaterial, future events may occur and may be material.
Portions of our information technology systems also may experience interruptions, delays or cessations of service or produce
Portions of our information technology systems also may experience interruptions, delays or cessations of service or produce
errors due to regular maintenance efforts, such as systems integration or migration work that takes place from time to time. We
errors due to regular maintenance efforts, such as systems integration or migration work that takes place from time to time. We
may not be successful in implementing new systems and transitioning data, which could cause business disruptions and be more
may not be successful in implementing new systems and transitioning data, which could cause business disruptions and be more
expensive, time-consuming, disruptive and resource intensive. Such disruptions could adversely impact our ability to design,
expensive, time-consuming, disruptive and resource intensive. Such disruptions could adversely impact our ability to design,
manufacture and sell products and services, and interrupt other business processes.
manufacture and sell products and services, and interrupt other business processes.
Security breaches and other disruptions of our in-vehicle systems could impact the safety of our customers and reduce
Security breaches and other disruptions of our in-vehicle systems could impact the safety of our customers and reduce
confidence in GM and our products. Our vehicles contain complex information technology systems. These systems control
confidence in GM and our products. Our vehicles contain complex information technology systems. These systems control
various vehicle functions including engine, transmission, safety, steering, navigation, acceleration, braking, window and door lock
various vehicle functions including engine, transmission, safety, steering, navigation, acceleration, braking, window and door lock
functions. We have designed, implemented and tested security measures intended to prevent unauthorized access to these systems.
functions. We have designed, implemented and tested security measures intended to prevent unauthorized access to these systems.
However, hackers have reportedly attempted, and may attempt in the future, to gain unauthorized access to modify, alter and use
However, hackers have reportedly attempted, and may attempt in the future, to gain unauthorized access to modify, alter and use
such systems to gain control of, or to change, our vehicles’ functionality, user interface and performance characteristics, or to gain
such systems to gain control of, or to change, our vehicles' functionality, user interface and performance characteristics, or to gain
access to data stored in or generated by the vehicle. Any unauthorized access to or control of our vehicles or their system could
access to data stored in or generated by the vehicle. Any unauthorized access to or control of our vehicles or their system could
adversely impact the safety of our customers or result in legal claims or proceedings, liability or regulatory penalties. In addition,
adversely impact the safety of our customers or result in legal claims or proceedings, liability or regulatory penalties. In addition,
regardless of their veracity, reports of unauthorized access to our vehicles or their systems could negatively affect our brand and
regardless of their veracity, reports of unauthorized access to our vehicles or their systems could negatively affect our brand and
harm our business, prospects, financial condition and operating results.
harm our business, prospects, fmancial condition and operating results.
d
Our enterprise data practices, including the collection, use, sharing, and security of the Personal Identifiable Information
Our enterprise data practices, including the collection, use, sharing, and security of the Personal Identifiable Information
of our customers, employees, or suppliers are subject to increasingly complex, restrictive, and punitive regulations in all key
of our customers, employees, or suppliers are subject to increasingly complex, restrictive, and punitive regulations in all key
market regions. Under these regulations, the failure to maintain compliant data practices could result in consumer complaints
market regions. Under these regulations, the failure to maintain compliant data practices could result in consumer complaints
and regulatory inquiry, resulting in civil or criminal penalties, as well as brand impact or other harm to our business. In addition,
and regulatory inquiry, resulting in civil or criminal penalties, as well as brand impact or other harm to our business. In addition,
increased consumer sensitivity to real or perceived failures in maintaining acceptable data practices could damage our reputation
increased consumer sensitivity to real or perceived failures in maintaining acceptable data practices could damage our reputation
and deter current and potential users or customers from using our products and services. Because many of these laws are new,
and deter current and potential users or customers from using our products and services. Because many of these laws are new,
there is little clarity as to their interpretation, as well as a lack of precedent for the scope of enforcement. The cost of compliance
there is little clarity as to their interpretation, as well as a lack of precedent for the scope of enforcement. The cost of compliance
with these laws and regulations will be high and is likely to increase in the future. For example, in Europe, the General Data
with these laws and regulations will be high and is likely to increase in the future. For example, in Europe, the General Data
Protection Regulation came into effect on May 25, 2018, and applies to all of our ongoing operations in the EU as well as some
Protection Regulation came into effect on May 25, 2018, and applies to all of our ongoing operations in the EU as well as some
of our operations outside of the EU that involve the processing of EU personal data. This regulation significantly increases the
of our operations outside of the EU that involve the processing of EU personal data. This regulation significantly increases the
potential financial penalties for noncompliance, including fines of up to 4% of worldwide revenue. Similar regulations are coming
potential fmancial penalties for noncompliance, including fines of up to 4% of worldwide revenue. Similar regulations are coming
into effect in Brazil and China, and in the U.S., California has adopted, and several states and provinces in Canada are considering
into effect in Brazil and China, and in the U.S., California has adopted, and several states and provinces in Canada are considering
adopting, laws and regulations imposing obligations regarding personal data. In some cases, these laws provide a private right of
adopting, laws and regulations imposing obligations regarding personal data. In some cases, these laws provide a private right of
action that would allow customers to bring suit directly against us for mishandling their data.
action that would allow customers to bring suit directly against us for mishandling their data.
Our operations and products are subject to extensive laws, regulations and policies, including those related to vehicle
Our operations and products are subject to extensive laws, regulations and policies, including those related to vehicle
emissions, fuel economy standards, and greenhouse gas emissions, that can significantly increase our costs and affect how we
emissions, fuel economy standards, and greenhouse gas emissions, that can significantly increase our costs and affect how we
do business. We are significantly affected by governmental regulations on a global basis that can increase costs related to the
do business. We are significantly affected by governmental regulations on a global basis that can increase costs related to the
production of our vehicles and affect our product portfolio, particularly regulations relating to emissions, fuel economy standards,
production of our vehicles and affect our product portfolio, particularly regulations relating to emissions, fuel economy standards,
and greenhouse gas emissions. Meeting or exceeding many of these regulations is costly and often technologically challenging,
and greenhouse gas emissions. Meeting or exceeding many of these regulations is costly and often technologically challenging,
especially because the standards are not harmonized across jurisdictions. We anticipate that the number and extent of these and
especially because the standards are not harmonized across jurisdictions. We anticipate that the number and extent of these and
other regulations, laws and policies, and the related costs and changes to our product portfolio, may increase significantly in the
other regulations, laws and policies, and the related costs and changes to our product portfolio, may increase significantly in the
future, primarily out of concern for the environment (including concerns about global climate change and its impact). These
future, primarily out of concern for the environment (including concerns about global climate change and its impact). These
government regulatory requirements, among others, could significantly affect our plans for global product development and given
government regulatory requirements, among others, could significantly affect our plans for global product development and given
n
14
14
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
the uncertainty surrounding enforcement and regulatory definitions and interpretations, may result in substantial costs, including
the uncertainty surrounding enforcement and regulatory definitions and interpretations, may result in substantial costs, including
civil or criminal penalties. In addition, an evolving but un-harmonized emissions and fuel economy regulatory framework may
civil or criminal penalties. In addition, an evolving but un-harmonized emissions and fuel economy regulatory framework may
limit or dictate the types of vehicles we sell and where we sell them, which can affect revenue. Refer to the “Environmental and
limit or dictate the types of vehicles we sell and where we sell them, which can affect revenue. Refer to the "Environmental and
Regulatory Matters” section of Item 1. Business for further information on regulatory and environmental requirements.
Regulatory Matters" section of Item 1. Business for further information on regulatory and environmental requirements.
We expect that to comply with fuel economy and emission control requirements we will be required to sell a significant volume
We expect that to comply with fuel economy and emission control requirements we will be required to sell a significant volume
of electric vehicles, and potentially develop and implement new technologies for conventional internal combustion engines, all at
of electric vehicles, and potentially develop and implement new technologies for conventional internal combustion engines, all at
increased costs. There are limits on our ability to achieve fuel economy improvements over a given time frame, however, primarily
increased costs. There are limits on our ability to achieve fuel economy improvements over a given time frame, however, primarily
relating to the cost and effectiveness of available technologies, lack of sufficient consumer acceptance of new technologies and
relating to the cost and effectiveness of available technologies, lack of sufficient consumer acceptance of new technologies and
of changes in vehicle mix, lack of willingness of consumers to absorb the additional costs of new technologies, the appropriateness
of changes in vehicle mix, lack of willingness of consumers to absorb the additional costs of new technologies, the appropriateness
(or lack thereof) of certain technologies for use in particular vehicles, the widespread availability (or lack thereof) of supporting
(or lack thereof) of certain technologies for use in particular vehicles, the widespread availability (or lack thereof) of supporting
infrastructure for new technologies, and the human, engineering, and financial resources necessary to deploy new technologies
infrastructure for new technologies, and the human, engineering, and fmancial resources necessary to deploy new technologies
across a wide range of products and powertrains in a short time. There is no assurance that we will be able to produce and sell
across a wide range of products and powertrains in a short time. There is no assurance that we will be able to produce and sell
vehicles that use such new technologies on a profitable basis or that our customers will purchase such vehicles in the quantities
vehicles that use such new technologies on a profitable basis or that our customers will purchase such vehicles in the quantities
necessary for us to comply with these regulatory programs.
necessary for us to comply with these regulatory programs.
In the current uncertain regulatory framework, environmental liabilities for which we may be responsible and that are not
In the current uncertain regulatory framework, environmental liabilities for which we may be responsible and that are not
reasonably estimable could be substantial. Alleged violations of safety, fuel economy or emissions standards could result in legal
reasonably estimable could be substantial. Alleged violations of safety, fuel economy or emissions standards could result in legal
proceedings, the recall of one or more of our products, negotiated remedial actions, fines, restricted product offerings or a
proceedings, the recall of one or more of our products, negotiated remedial actions, fmes, restricted product offerings or a
combination of any of those items. Any of these actions could have a material adverse effect on our operations including facility
combination of any of those items. Any of these actions could have a material adverse effect on our operations including facility
idling, reduced employment, increased costs and loss of revenue.
idling, reduced employment, increased costs and loss of revenue.
In addition, many of our advanced technologies, including autonomous vehicles, present novel issues with which domestic and
In addition, many of our advanced technologies, including autonomous vehicles, present novel issues with which domestic and
foreign regulators have only limited experience and will be subject to evolving regulatory frameworks. Any current or future
foreign regulators have only limited experience and will be subject to evolving regulatory frameworks. Any current or future
regulations in these areas could impact whether and how these technologies are designed and integrated into our products, and
regulations in these areas could impact whether and how these technologies are designed and integrated into our products, and
may ultimately subject us to increased costs and uncertainty.
may ultimately subject us to increased costs and uncertainty.
We could be materially adversely affected by unusual or significant litigation, governmental investigations or other
We could be materially adversely affected by unusual or significant litigation, governmental investigations or other
proceedings. We are subject to legal proceedings involving various issues, including product liability lawsuits, class action
proceedings. We are subject to legal proceedings involving various issues, including product liability lawsuits, class action
litigations alleging product defects, emissions litigation (both in the U.S. and elsewhere), stockholder litigation, labor and
litigations alleging product defects, emissions litigation (both in the U.S. and elsewhere), stockholder litigation, labor and
employment litigation in various countries (including U.S., Canada, Korea and Brazil), claims and actions arising from divestitures
employment litigation in various countries (including U.S., Canada, Korea and Brazil), claims and actions arising from divestitures
of operations and assets and proceedings related to the Ignition Switch Recall. In addition, we are subject to governmental
of operations and assets and proceedings related to the Ignition Switch Recall. In addition, we are subject to governmental
proceedings and investigations. A negative outcome in one or more of these legal proceedings could result in the imposition of
proceedings and investigations. A negative outcome in one or more of these legal proceedings could result in the imposition of
damages, including punitive damages, substantial fines, significant reputational harm, civil lawsuits and criminal penalties,
damages, including punitive damages, substantial fines, significant reputational harm, civil lawsuits and criminal penalties,
interruptions of business, modification of business practices, equitable remedies and other sanctions against us or our personnel
interruptions of business, modification of business practices, equitable remedies and other sanctions against us or our personnel
as well as significant legal and other costs. In addition, we may become obligated to issue additional shares (Adjustment Shares)
as well as significant legal and other costs. In addition, we may become obligated to issue additional shares (Adjustment Shares)
of up to 30 million shares of our common stock (subject to adjustment to take into account stock dividends, stock splits and other
of up to 30 million shares of our common stock (subject to adjustment to take into account stock dividends, stock splits and other
transactions) to the Motors Liquidation Company (MLC) GUC Trust (GUC Trust) under a provision of the Amended and Restated
transactions) to the Motors Liquidation Company (MLC) GUC Trust (GUC Trust) under a provision of the Amended and Restated
Master Sale and Purchase Agreement between us and General Motors Corporation and certain of its subsidiaries in the event that
Master Sale and Purchase Agreement between us and General Motors Corporation and certain of its subsidiaries in the event that
allowed general unsecured claims against the GUC Trust, as estimated by the United States Bankruptcy Court for the Southern
allowed general unsecured claims against the GUC Trust, as estimated by the United States Bankruptcy Court for the Southern
District of New York (Bankruptcy Court), exceed $35.0 billion. The GUC Trust stated in public filings that allowed general
District of New York (Bankruptcy Court), exceed $35.0 billion. The GUC Trust stated in public filings that allowed general
unsecured claims were approximately $32.1 billion as of September 30, 2019. For a further discussion of these matters refer to
unsecured claims were approximately $32.1 billion as of September 30, 2019. For a further discussion of these matters refer to
Note 16 to our consolidated financial statements.
Note 16 to our consolidated fmancial statements.
tt
tt
The costs and effect on our reputation of product safety recalls and alleged defects in products and services could materially
The costs and effect on our reputation ofproduct safety recalls and alleged defects in products and services could materially
adversely affect our business. Government safety standards require manufacturers to remedy certain product safety defects through
adversely affect our business. Government safety standards require manufacturers to remedy certain product safety defects through
recall campaigns and vehicle repurchases. Under these standards, we could be subject to civil or criminal penalties or may incur uu
recall campaigns and vehicle repurchases. Under these standards, we could be subject to civil or criminal penalties or may incur
various costs, including significant costs for repairs made at no cost to the consumer. At present, the costs we incur in connection
various costs, including significant costs for repairs made at no cost to the consumer. At present, the costs we incur in connection
with these recalls typically include the cost of the part being replaced and labor to remove and replace the defective part. The costs
with these recalls typically include the cost of the part being replaced and labor to remove and replace the defective part. The costs
to complete a recall could be exacerbated to the extent that such action relates to a global platform. Concerns about the safety of
to complete a recall could be exacerbated to the extent that such action relates to a global platform. Concerns about the safety of
our products, including advanced technologies like autonomous vehicles, whether raised internally or by regulators or consumer
our products, including advanced technologies like autonomous vehicles, whether raised internally or by regulators or consumer
advocates, and whether or not based on scientific evidence or supported by data, can result in product delays, recalls, lost sales,
advocates, and whether or not based on scientific evidence or supported by data, can result in product delays, recalls, lost sales,
governmental investigations, regulatory action, private claims, lawsuits and settlements, and reputational damage. These
governmental investigations, regulatory action, private claims, lawsuits and settlements, and reputational damage. These
circumstances can also result in damage to brand image, brand equity and consumer trust in the Company’s products and ability
circumstances can also result in damage to brand image, brand equity and consumer trust in the Company's products and ability
to lead the disruption occurring in the automotive industry.
to lead the disruption occurring in the automotive industry.
tt
15
15
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
We currently source a variety of systems, components, raw materials and parts from third parties. From time to time these items
We currently source a variety of systems, components, raw materials and parts from third parties. From time to time these items
may have performance or quality issues that could harm our reputation and cause us to incur significant costs, particularly if the
may have performance or quality issues that could harm our reputation and cause us to incur significant costs, particularly if the
affected items relate to global platforms or involve defects that are identified years after production. Our ability to recover costs
affected items relate to global platforms or involve defects that are identified years after production. Our ability to recover costs
associated with recalls or other campaigns caused by parts or components purchased from suppliers may be limited by the suppliers’
associated with recalls or other campaigns caused by parts or components purchased from suppliers may be limited by the suppliers'
financial condition or a number of other reasons or defenses.
financial condition or a number of other reasons or defenses.
r
We may incur additional tax expense or become subject to additional tax exposure. We are subject to the tax laws and regulations
We may incur additional tax expense or become subject to additional tax exposure. We are subject to the tax laws and regulations
of the U.S. and numerous other jurisdictions in which we do business. Many judgments are required in determining our worldwide
of the U.S. and numerous other jurisdictions in which we do business. Many judgments are required in determining our worldwide
provision for income taxes and other tax liabilities, and we are regularly under audit by the U.S. Internal Revenue Service and
provision for income taxes and other tax liabilities, and we are regularly under audit by the U.S. Internal Revenue Service and
other tax authorities, which may not agree with our tax positions. In addition, our tax liabilities are subject to other significant
other tax authorities, which may not agree with our tax positions. In addition, our tax liabilities are subject to other significant
risks and uncertainties, including those arising from potential changes in laws and/or regulations in the countries in which we do
risks and uncertainties, including those arising from potential changes in laws and/or regulations in the countries in which we do
business, the possibility of adverse determinations with respect to the application of existing laws, changes in our business or
business, the possibility of adverse determinations with respect to the application of existing laws, changes in our business or
structure and changes in the valuation of our deferred tax assets and liabilities. Any unfavorable resolution of these and other
structure and changes in the valuation of our deferred tax assets and liabilities. Any unfavorable resolution of these and other
uncertainties may have a significant adverse impact on our tax rate and results of operations. If our tax expense were to increase,
uncertainties may have a significant adverse impact on our tax rate and results of operations. If our tax expense were to increase,
or if the ultimate determination of our taxes owed is for an amount in excess of amounts previously accrued, our operating results,
or if the ultimate determination of our taxes owed is for an amount in excess of amounts previously accrued, our operating results,
cash flows and financial condition could be adversely affected.
cash flows and fmancial condition could be adversely affected.
ff
We rely on GM Financial to provide financial services to our customers and dealers in North America, South America and
We rely on GM Financial to provide financial services to our customers and dealers in North America, South America and
Asia/Pacific. GM Financial faces a number of business, economic and financial risks that could impair its access to capital and
Asia/Pacific. GM Financial faces a number of business, economic and fmancial risks that could impair its access to capital and
negatively affect its business and operations, which in turn could impede its ability to provide leasing and financing to customers
negatively affect its business and operations, which in turn could impede its ability to provide leasing and financing to customers
and commercial lending to our dealers. Any reduction in GM Financial’s ability to provide such financial services would negatively
and commercial lending to our dealers. Any reduction in GM Financial's ability to provide such financial services would negatively
affect our efforts to support additional sales of our vehicles and expand our market penetration among customers and dealers.
affect our efforts to support additional sales of our vehicles and expand our market penetration among customers and dealers.
The primary factors that could adversely affect GM Financial’s business and operations and reduce its ability to provide financing
The primary factors that could adversely affect GM Financial's business and operations and reduce its ability to provide fmancing
services at competitive rates include the sufficiency, availability and cost of sources of financing, including credit facilities,
services at competitive rates include the sufficiency, availability and cost of sources of fmancing, including credit facilities,
securitization programs and secured and unsecured debt issuances; the performance of loans and leases in its portfolio, which
securitization programs and secured and unsecured debt issuances; the performance of loans and leases in its portfolio, which
could be materially affected by charge-offs, delinquencies and prepayments; wholesale auction values of used vehicles; higher
could be materially affected by charge-offs, delinquencies and prepayments; wholesale auction values of used vehicles; higher
than expected vehicle return rates and the residual value performance on vehicles GM Financial leases to customers; fluctuations
than expected vehicle return rates and the residual value performance on vehicles GM Financial leases to customers; fluctuations
in interest rates and currencies; competition for customers from commercial banks, credit unions and other financing and leasing
in interest rates and currencies; competition for customers from commercial banks, credit unions and other financing and leasing
companies; and changes to regulation, supervision, enforcement and licensing across various jurisdictions.
companies; and changes to regulation, supervision, enforcement and licensing across various jurisdictions.
In addition, a substantial portion of GM Financial’s indebtedness bears interest at variable interest rates, primarily based on
In addition, a substantial portion of GM Financial's indebtedness bears interest at variable interest rates, primarily based on
USD-LIBOR. The U.K. Financial Conduct Authority, which regulates LIBOR, has announced that it will no longer persuade or
USD-LIBOR. The U.K. Financial Conduct Authority, which regulates LIBOR, has announced that it will no longer persuade or
compel banks to submit rates for the calculation of LIBOR after 2021. It is unknown whether any banks will continue to voluntarily
compel banks to submit rates for the calculation of LIBOR after 2021. It is unknown whether any banks will continue to voluntarily
submit rates for the calculation of LIBOR, or whether LIBOR will continue to be published by its administrator based on these
submit rates for the calculation of LIBOR, or whether LIBOR will continue to be published by its administrator based on these
submissions or on any other basis, after 2021. At this time, it is not possible to predict the effect that these developments or any
submissions or on any other basis, after 2021. At this time, it is not possible to predict the effect that these developments or any
discontinuance, modification or other reforms may have on LIBOR, other benchmarks or floating–rate debt instruments, including
discontinuance, modification or other reforms may have on LIBOR, other benchmarks or floating—rate debt instruments, including
GM Financial’s floating–rate debt. Any such discontinuance, modification, alternative reference rates or other reforms may
GM Financial's floating—rate debt. Any such discontinuance, modification, alternative reference rates or other reforms may
materially adversely affect interest rates on GM Financial’s current or future indebtedness. There is a risk that the discontinuation
materially adversely affect interest rates on GM Financial's current or future indebtedness. There is a risk that the discontinuation
of LIBOR will impact GM Financial's ability to manage interest rate risk effectively without an adequate replacement.
of LIBOR will impact GM Financial's ability to manage interest rate risk effectively without an adequate replacement.
n
Further, as an entity operating in the financial services sector, GM Financial is required to comply with a wide variety of laws
Further, as an entity operating in the fmancial services sector, GM Financial is required to comply with a wide variety of laws
and regulations that may be costly to adhere to and may affect our consolidated operating results. Compliance with these laws and
and regulations that may be costly to adhere to and may affect our consolidated operating results. Compliance with these laws and
regulations requires that GM Financial maintain forms, processes, procedures, controls and the infrastructure to support these
regulations requires that GM Financial maintain forms, processes, procedures, controls and the infrastructure to support these
requirements and these laws and regulations often create operational constraints both on GM Financial’s ability to implement
requirements and these laws and regulations often create operational constraints both on GM Financial's ability to implement
servicing procedures and on pricing. Laws in the financial services industry are designed primarily for the protection of consumers.
servicing procedures and on pricing. Laws in the financial services industry are designed primarily for the protection of consumers.
The failure to comply with these laws could result in significant statutory civil and criminal penalties, monetary damages, attorneys’
The failure to comply with these laws could result in significant statutory civil and criminal penalties, monetary damages, attorneys'
fees and costs, possible revocation of licenses and damage to reputation, brand and valued customer relationships.
fees and costs, possible revocation of licenses and damage to reputation, brand and valued customer relationships.
u
aa
Our defined benefit pension plans are currently underfunded and our pension funding requirements could increase
Our defined benefit pension plans are currently underfunded and our pension funding requirements could increase
significantly due to a reduction in funded status as a result of a variety of factors, including weak performance of financial
significantly due to a reduction in funded status as a result of a variety of factors, including weak performance of financial
markets, declining interest rates, changes in laws or regulations, changes in assumptions or investments that do not achieve
markets, declining interest rates, changes in laws or regulations, changes in assumptions or investments that do not achieve
adequate returns. Our employee benefit plans currently hold a significant amount of equity and fixed income securities. A detailed
adequate returns. Our employee benefit plans currently hold a significant amount of equity and fixed income securities. A detailed
description of the investment funds and strategies and our potential funding requirements are disclosed in Note 15 to our consolidated
description of the investment funds and strategies and our potential funding requirements are disclosed in Note 15 to our consolidated
financial statements, which also describes significant concentrations of risk to the plan investments.
financial statements, which also describes significant concentrations of risk to the plan investments.
16
16
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Our future funding requirements for our defined benefit pension plans depend upon the future performance of assets placed in
Our future funding requirements for our defmed benefit pension plans depend upon the future performance of assets placed in
trusts for these plans, the level of interest rates used to determine funding levels, the level of benefits provided for by the plans
trusts for these plans, the level of interest rates used to determine funding levels, the level of benefits provided for by the plans
and any changes in laws and regulations. Future funding requirements generally increase if the discount rate decreases or if actual
and any changes in laws and regulations. Future funding requirements generally increase if the discount rate decreases or if actual
asset returns are lower than expected asset returns, assuming other factors are held constant. We estimate future contributions to
asset returns are lower than expected asset returns, assuming other factors are held constant. We estimate future contributions to
these plans using assumptions with respect to these and other items. Changes to those assumptions could have a significant effect
these plans using assumptions with respect to these and other items. Changes to those assumptions could have a significant effect
on future contributions.
on future contributions.
There are additional risks due to the complexity and magnitude of our investments. Examples include implementation of
There are additional risks due to the complexity and magnitude of our investments. Examples include implementation of
significant changes in investment policy, insufficient market liquidity in particular asset classes and the inability to quickly rebalance
significant changes in investment policy, insufficient market liquidity in particular asset classes and the inability to quickly rebalance
illiquid and long-term investments.
illiquid and long-term investments.
Factors that affect future funding requirements for our U.S. defined benefit plans generally affect the required funding for non-
Factors that affect future funding requirements for our U.S. defmed benefit plans generally affect the required funding for non-
U.S. plans. Certain plans outside the U.S. do not have assets and therefore the obligation is funded as benefits are paid. If local
U.S. plans. Certain plans outside the U.S. do not have assets and therefore the obligation is funded as benefits are paid. If local
legal authorities increase the minimum funding requirements for our non-U.S. plans, we could be required to contribute more
legal authorities increase the minimum funding requirements for our non-U.S. plans, we could be required to contribute more
funds.
funds.
Item 1B. Unresolved Staff Comments
Item 1B. Unresolved Staff Comments
None
None
Item 2. Properties
Item 2. Properties
* * * * * * *
* * * * * * *
At December 31, 2019 we had over 100 locations in the U.S. (excluding our automotive financing operations and dealerships),
At December 31, 2019 we had over 100 locations in the U.S. (excluding our automotive fmancing operations and dealerships),
which are primarily for manufacturing, assembly, distribution, warehousing, engineering and testing. We, our subsidiaries or
which are primarily for manufacturing, assembly, distribution, warehousing, engineering and testing. We, our subsidiaries or
associated companies in which we own an equity interest own most of these properties and/or lease a portion of these properties.
associated companies in which we own an equity interest own most of these properties and/or lease a portion of these properties.
Leased properties are primarily composed of warehouses and administration, engineering and sales offices.
Leased properties are primarily composed of warehouses and administration, engineering and sales offices.
We have manufacturing, assembly, distribution, office or warehousing operations in 32 countries, including equity interests in
We have manufacturing, assembly, distribution, office or warehousing operations in 32 countries, including equity interests in
associated companies, which perform manufacturing, assembly or distribution operations. The major facilities outside the U.S.,
associated companies, which perform manufacturing, assembly or distribution operations. The major facilities outside the U.S.,
which are principally vehicle manufacturing and assembly operations, are located in Argentina, Brazil, Canada, China, Colombia,
which are principally vehicle manufacturing and assembly operations, are located in Argentina, Brazil, Canada, China, Colombia,
Ecuador, Mexico, and South Korea.
Ecuador, Mexico, and South Korea.
GM Financial owns or leases facilities for administration and regional credit centers. GM Financial has 43 facilities, of which
GM Financial owns or leases facilities for administration and regional credit centers. GM Financial has 43 facilities, of which
28 are located in the U.S. The major facilities outside the U.S. are located in Brazil, Canada and Mexico.
28 are located in the U.S. The major facilities outside the U.S. are located in Brazil, Canada and Mexico.
Item 3. Legal Proceedings
Item 3. Legal Proceedings
* * * * * * *
The discussion under "Litigation-Related Liability and Tax Administrative Matters" in Note 16 to our consolidated financial
The discussion under "Litigation-Related Liability and Tax Administrative Matters" in Note 16 to our consolidated financial
statements is incorporated by reference into this Part II - Item 3.
statements is incorporated by reference into this Part II - Item 3.
Item 4. Mine Safety Disclosures
Item 4. Mine Safety Disclosures
Not applicable
Not applicable
* * * * * * *
* * * * * * *
17
17
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
PART II
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information Shares of our common stock are publicly traded on the New York Stock Exchange under the symbol "GM".
Market Information Shares of our common stock are publicly traded on the New York Stock Exchange under the symbol "GM".
Holders At January 24, 2020 we had 1.4 billion issued and outstanding shares of common stock held by 488 holders of record.
Holders At January 24, 2020 we had 1.4 billion issued and outstanding shares of common stock held by 488 holders of record.
Purchases of Equity Securities The following table summarizes our purchases of common stock in the three months ended
Purchases of Equity Securities The following table summarizes our purchases of common stock in the three months ended
December 31, 2019:
December 31, 2019:
Total Number
Total Number
of Shares
of Shares
Purchased(a)
Purchased(a)
October 1, 2019 through October 31, 2019 . . . . . . . . . . . .
23,723
October 1, 2019 through October 31, 2019 23,723
3,480
November 1, 2019 through November 30, 2019 . . . . . . . .
3,480
November 1, 2019 through November 30, 2019
29,090
December 1, 2019 through December 31, 2019 . . . . . . . . .
29,090
December 1, 2019 through December 31, 2019
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
56,293
Total 56,293
Approximate Dollar
Approximate Dollar
Total Number of
Weighted
Value of Shares That
Value of Shares That
Total Number of
Weighted
Average
Shares Purchased
May Yet be Purchased
Shares Purchased May Yet be Purchased
Average
Under Announced
Price Paid
Under Announced
Price Paid Under Announced
Under Announced
per Share
Programs(b)
Programs(b)
per Share
Programs
Programs
$3.4 billion
$ 36.08
$3.4 billion
$ 36.08
$3.4 billion
$ 37.16
$3.4 billion
$ 37.16
$3.4 billion
$ 36.28
$3.4 billion
$ 36.28
$ 36.25
$ 36.25
—
—
—
—
__________
(a) Shares purchased consist of shares delivered by employees or directors to us for the payment of taxes resulting from issuance of common
(a) Shares purchased consist of shares delivered by employees or directors to us for the payment of taxes resulting from issuance of common
stock upon the vesting of Restricted Stock Units (RSUs), Performance Stock Units (PSUs) and Restricted Stock Awards (RSAs) relating
stock upon the vesting of Restricted Stock Units (RSUs), Perfonnance Stock Units (PSUs) and Restricted Stock Awards (RSAs) relating
to compensation plans. In June 2017 our shareholders approved the 2017 Long Term Incentive Plan, which authorizes awards of stock
to compensation plans. In June 2017 our shareholders approved the 2017 Long Tenn Incentive Plan, which authorizes awards of stock
options, stock appreciation rights, RSAs, RSUs, PSUs or other stock-based awards to selected employees, consultants, advisors, and non-
options, stock appreciation rights, RSAs, RSUs, PSUs or other stock-based awards to selected employees, consultants, advisors, and non-
employee Directors of the Company. Refer to Note 23 to our consolidated financial statements for additional details on employee stock
employee Directors of the Company. Refer to Note 23 to our consolidated financial statements for additional details on employee stock
incentive plans.
incentive plans.
(b) In January 2017 we announced that our Board of Directors had authorized the purchase of up to an additional $5.0 billion of our common
(b) In January 2017 we announced that our Board of Directors had authorized the purchase of up to an additional $5.0 billion of our common
f
stock with no expiration date.
stock with no expiration date.
* * * * * * *
18
18
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Item 6. Selected Financial Data
Item 6. Selected Financial Data
At and for the Years Ended December 31,
At and for the Years Ended December 31,
2019
2019
2018
2018
2017
2017
2016
2016
2015
2015
Income Statement Data:
Income Statement Data:
Total net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total net sales and revenue $ 137,237
137,237
Income from continuing operations(a) . . . . . . . . . . . . . . . . . . . . . . . . $
Income from continuing operations(a) 6,667
6,667
Basic earnings per common share – continuing operations(a) . . . . . . $
Basic earnings per common share - continuing operations(a)
4.62
4.62
Diluted earnings per common share – continuing operations(a) . . . . $
Diluted earnings per common share - continuing operations(a) . .
$ 4.57
4.57
Dividends declared per common share. . . . . . . . . . . . . . . . . . . . . . . . $
Dividends declared per common share 1.52
1.52
Balance Sheet Data:
Balance Sheet Data:
Total assets(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total assets(b) $ 228,037
228,037
Automotive notes and loans payable . . . . . . . . . . . . . . . . . . . . . . . . . $
Automotive notes and loans payable $ 14,386
14,386
GM Financial notes and loans payable . . . . . . . . . . . . . . . . . . . . . . . . $
GM Financial notes and loans payable $ 88,938
88,938
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total equity $ 45,957
45,957
147,049
$
$ 147,049
$
8,075
$ 8,075
$
5.66
$ 5.66
$
5.58
$ 5.58
$
1.52
$ 1.52
145,588
$
$ 145,588
$
9,269
330
$ 330 $ 9,269
$
149,184
$ 149,184
$
$
0.23
$ 0.23
$
0.22
$ 0.22
$
1.52
$ 1.52
$
6.12
$ 6.12
$
6.00
$ 6.00
$
1.52
$ 1.52
$
135,725
$ 135,725
$
9,590
$ 9,590
$
6.09
$ 6.09
$
5.89
$ 5.89
$
1.38
$ 1.38
$
227,339
$ 227,339
$
212,482
$ 212,482
$
221,690
$ 221,690
$
194,338
$ 194,338
$
13,963
$ 13,963
$
13,502
$ 13,502
$
10,560
$ 10,560
$
8,535
$ 8,535
$
90,988
$ 90,988
$
80,717
$ 80,717
$
64,563
$ 64,563
$
45,479
$ 45,479
$
42,777
$ 42,777
$
36,200
$ 36,200
$
44,075
$ 44,075
$
40,323
$ 40,323
_________
(a) We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable pre-tax impact of approximately
(a) We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable pre-tax impact of approximately
$3.6 billion on our Income from continuing operations in the year ended December 31, 2019. In the year ended December 31, 2019 we
$3.6 billion on our Income from continuing operations in the year ended December 31, 2019. In the year ended December 31, 2019 we
recorded: (1) pre-tax charges of $1.8 billion related to transformation activities including accelerated depreciation, supplier-related charges
recorded: (1) pre-tax charges of $1.8 billion related to transformation activities including accelerated depreciation, supplier-related charges
and other charges; and (2) a pre-tax benefit of $1.4 billion related to the retrospective recoveries of indirect taxes in Brazil. In the year ended
and other charges; and (2) a pre-tax benefit of $1.4 billion related to the retrospective recoveries of indirect taxes in Brazil. In the year ended
December 31, 2018 we recorded: (1) pre-tax charges of $1.3 billion related to transformation activities including employee separation,
December 31, 2018 we recorded: (1) pre-tax charges of $1.3 billion related to transformation activities including employee separation,
accelerated depreciation and other charges; (2) pre-tax charges of $1.1 billion related to the closure of a facility and other restructuring
accelerated depreciation and other charges; (2) pre-tax charges of $1.1 billion related to the closure of a facility and other restructuring
actions in Korea; (3) pre-tax charges of $0.4 billion for ignition switch related legal matters; and (4) a non-recurring tax benefit of $1.0
actions in Korea; (3) pre-tax charges of $0.4 billion for ignition switch related legal matters; and (4) a non-recurring tax benefit of $1.0
billion related to foreign earnings. In the year ended December 31, 2017 we recorded: (1) tax expense of $7.3 billion related to U.S. tax
billion related to foreign earnings. In the year ended December 31, 2017 we recorded: (1) tax expense of $7.3 billion related to U.S. tax
reform legislation; (2) $2.3 billion related to the establishment of a valuation allowance against deferred tax assets that will no longer be
reform legislation; (2) $2.3 billion related to the establishment of a valuation allowance against deferred tax assets that will no longer be
realizable as a result of the sale of the Opel/Vauxhall Business; and (3) pre-tax charges of $0.5 billion related to restructuring actions in
realizable as a result of the sale of the OpelNauxhall Business; and (3) pre-tax charges of $0.5 billion related to restructuring actions in
India and South Africa. In the year ended December 31, 2015 we recorded: (1) the reversal of deferred tax asset valuation allowances of
India and South Africa. In the year ended December 31, 2015 we recorded: (1) the reversal of deferred tax asset valuation allowances of
$3.9 billion in Europe; and (2) pre-tax charges related to the Ignition Switch Recall Compensation Program and for various legal matters
$3.9 billion in Europe; and (2) pre-tax charges related to the Ignition Switch Recall Compensation Program and for various legal matters
of approximately $1.6 billion.
of approximately $1.6 billion.
aa
(b) Total assets included assets held for sale of $20.6 billion and $20.0 billion at December 31, 2016 and 2015.
(b) Total assets included assets held for sale of $20.6 billion and $20.0 billion at December 31, 2016 and 2015.
* * * * * * *
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
This MD&A should be read in conjunction with the accompanying audited consolidated financial statements and notes. Forward-
This MD&A should be read in conjunction with the accompanying audited consolidated financial statements and notes. Forward-
looking statements in this MD&A are not guarantees of future performance and may involve risks and uncertainties that could
looking statements in this MD&A are not guarantees of future performance and may involve risks and uncertainties that could
cause actual results to differ materially from those projected. Refer to the "Forward-Looking Statements" section of this MD&A
cause actual results to differ materially from those projected. Refer to the "Forward-Looking Statements" section of this MD&A
and Item 1A. Risk Factors for a discussion of these risks and uncertainties. The discussion of our financial condition and results
and Item 1A. Risk Factors for a discussion of these risks and uncertainties. The discussion of our fmancial condition and results
of operations for the year ended December 31, 2017 included in Item 7. Management's Discussion and Analysis of Financial
of operations for the year ended December 31, 2017 included in Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2018 is incorporated
Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2018 is incorporated
by reference into this MD&A.
by reference into this MD&A.
Non-GAAP Measures Unless otherwise indicated, our non-GAAP measures discussed in this MD&A are related to our continuing
Non-GAAP Measures Unless otherwise indicated, our non-GAAP measures discussed in this MD&A are related to our continuing
operations and not our discontinued operations. Our non-GAAP measures include: earnings before interest and taxes (EBIT)-
operations and not our discontinued operations. Our non-GAAP measures include: earnings before interest and taxes (EBIT)-
adjusted, presented net of noncontrolling interests; earnings before income taxes (EBT)-adjusted for our GM Financial segment;
adjusted, presented net of noncontrolling interests; earnings before income taxes (EBT)-adjusted for our GM Financial segment;
earnings per share (EPS)-diluted-adjusted; effective tax rate-adjusted (ETR-adjusted); return on invested capital-adjusted (ROIC-
earnings per share (EPS)-diluted-adjusted; effective tax rate-adjusted (ETR-adjusted); return on invested capital-adjusted (ROIC-
adjusted) and adjusted automotive free cash flow. Our calculation of these non-GAAP measures may not be comparable to similarly
adjusted) and adjusted automotive free cash flow. Our calculation of these non-GAAP measures may not be comparable to similarly
titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the
titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the
use of these non-GAAP measures has limitations and should not be considered superior to, in isolation from, or as a substitute for,
use of these non-GAAP measures has limitations and should not be considered superior to, in isolation from, or as a substitute for,
related U.S. GAAP measures.
related U.S. GAAP measures.
These non-GAAP measures allow management and investors to view operating trends, perform analytical comparisons and
These non-GAAP measures allow management and investors to view operating trends, perform analytical comparisons and
benchmark performance between periods and among geographic regions to understand operating performance without regard to
benchmark performance between periods and among geographic regions to understand operating performance without regard to
items we do not consider a component of our core operating performance. Furthermore, these non-GAAP measures allow investors
items we do not consider a component of our core operating performance. Furthermore, these non-GAAP measures allow investors
the opportunity to measure and monitor our performance against our externally communicated targets and evaluate the investment
the opportunity to measure and monitor our performance against our externally communicated targets and evaluate the investment
19
19
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
decisions being made by management to improve ROIC-adjusted. Management uses these measures in its financial, investment
decisions being made by management to improve ROIC-adjusted. Management uses these measures in its financial, investment
and operational decision-making processes, for internal reporting and as part of its forecasting and budgeting processes. Further,
and operational decision-making processes, for internal reporting and as part of its forecasting and budgeting processes. Further,
our Board of Directors uses certain of these and other measures as key metrics to determine management performance under our
our Board of Directors uses certain of these and other measures as key metrics to determine management performance under our
performance-based compensation plans. For these reasons we believe these non-GAAP measures are useful for our investors.
performance-based compensation plans. For these reasons we believe these non-GAAP measures are useful for our investors.
EBIT-adjusted EBIT-adjusted is presented net of noncontrolling interests and is used by management and can be used by
EBIT-adjusted EBIT-adjusted is presented net of noncontrolling interests and is used by management and can be used by
investors to review our consolidated operating results because it excludes automotive interest income, automotive interest expense
investors to review our consolidated operating results because it excludes automotive interest income, automotive interest expense
and income taxes as well as certain additional adjustments that are not considered part of our core operations. Examples of
and income taxes as well as certain additional adjustments that are not considered part of our core operations. Examples of
adjustments to EBIT include but are not limited to impairment charges on long-lived assets and other exit costs resulting from
adjustments to EBIT include but are not limited to impairment charges on long-lived assets and other exit costs resulting from
strategic shifts in our operations or discrete market and business conditions; costs arising from the ignition switch recall and related
strategic shifts in our operations or discrete market and business conditions; costs arising from the ignition switch recall and related
legal matters; and certain currency devaluations associated with hyperinflationary economies. For EBIT-adjusted and our other
legal matters; and certain currency devaluations associated with hyperinflationary economies. For EBIT-adjusted and our other
non-GAAP measures, once we have made an adjustment in the current period for an item, we will also adjust the related non-
non-GAAP measures, once we have made an adjustment in the current period for an item, we will also adjust the related non-
GAAP measure in any future periods in which there is an impact from the item. Our corresponding measure for our GM Financial
GAAP measure in any future periods in which there is an impact from the item. Our corresponding measure for our GM Financial
segment is EBT-adjusted.
segment is EBT-adjusted.
EPS-diluted-adjusted EPS-diluted-adjusted is used by management and can be used by investors to review our consolidated
EPS-diluted-adjusted EPS-diluted-adjusted is used by management and can be used by investors to review our consolidated
diluted EPS results on a consistent basis. EPS-diluted-adjusted is calculated as net income attributable to common stockholders-
diluted EPS results on a consistent basis. EPS-diluted-adjusted is calculated as net income attributable to common stockholders-
diluted less income (loss) from discontinued operations on an after-tax basis, adjustments noted above for EBIT-adjusted and
diluted less income (loss) from discontinued operations on an after-tax basis, adjustments noted above for EBIT-adjusted and
certain income tax adjustments divided by weighted-average common shares outstanding-diluted. Examples of income tax
certain income tax adjustments divided by weighted-average common shares outstanding-diluted. Examples of income tax
adjustments include the establishment or reversal of significant deferred tax asset valuation allowances.
adjustments include the establishment or reversal of significant deferred tax asset valuation allowances.
ETR-adjusted ETR-adjusted is used by management and can be used by investors to review the consolidated effective tax rate
ETR-adjusted ETR-adjusted is used by management and can be used by investors to review the consolidated effective tax rate
for our core operations on a consistent basis. ETR-adjusted is calculated as Income tax expense less the income tax related to the
for our core operations on a consistent basis. ETR-adjusted is calculated as Income tax expense less the income tax related to the
adjustments noted above for EBIT-adjusted and the income tax adjustments noted above for EPS-diluted-adjusted divided by
adjustments noted above for EBIT-adjusted and the income tax adjustments noted above for EPS-diluted-adjusted divided by
Income before income taxes less adjustments. When we provide an expected adjusted effective tax rate, we do not provide an
Income before income taxes less adjustments. When we provide an expected adjusted effective tax rate, we do not provide an
expected effective tax rate because the U.S. GAAP measure may include significant adjustments that are difficult to predict.
expected effective tax rate because the U.S. GAAP measure may include significant adjustments that are difficult to predict.
d
ROIC-adjusted ROIC-adjusted is used by management and can be used by investors to review our investment and capital
ROIC-adjusted ROIC-adjusted is used by management and can be used by investors to review our investment and capital
allocation decisions. We define ROIC-adjusted as EBIT-adjusted for the trailing four quarters divided by ROIC-adjusted average
allocation decisions. We defme ROIC-adjusted as EBIT-adjusted for the trailing four quarters divided by ROIC-adjusted average
net assets, which is considered to be the average equity balances adjusted for average automotive debt and interest liabilities,
net assets, which is considered to be the average equity balances adjusted for average automotive debt and interest liabilities,
exclusive of finance leases; average automotive net pension and other postretirement benefits (OPEB) liabilities; and average
exclusive of finance leases; average automotive net pension and other postretirement benefits (OPEB) liabilities; and average
automotive net income tax assets during the same period. Adjustments to the average equity balances exclude assets and liabilities
automotive net income tax assets during the same period. Adjustments to the average equity balances exclude assets and liabilities
classified as either assets held for sale or liabilities held for sale.
classified as either assets held for sale or liabilities held for sale.
Adjusted automotive free cash flow Adjusted automotive free cash flow is used by management and can be used by investors
Adjusted automotive free cash flow Adjusted automotive free cash flow is used by management and can be used by investors
to review the liquidity of our automotive operations and to measure and monitor our performance against our capital allocation
to review the liquidity of our automotive operations and to measure and monitor our performance against our capital allocation
program and evaluate our automotive liquidity against the substantial cash requirements of our automotive operations. We measure
program and evaluate our automotive liquidity against the substantial cash requirements of our automotive operations. We measure
adjusted automotive free cash flow as automotive operating cash flow from continuing operations less capital expenditures adjusted
adjusted automotive free cash flow as automotive operating cash flow from continuing operations less capital expenditures adjusted
for management actions. Management actions can include voluntary events such as discretionary contributions to employee benefit
for management actions. Management actions can include voluntary events such as discretionary contributions to employee benefit
plans or nonrecurring specific events such as a closure of a facility that are considered special for EBIT-adjusted purposes. Refer
plans or nonrecurring specific events such as a closure of a facility that are considered special for EBIT-adjusted purposes. Refer
to the “Liquidity and Capital Resources” section of this MD&A for additional information.
to the "Liquidity and Capital Resources" section of this MD&A for additional information.
20
20
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table reconciles Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted:
The following table reconciles Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted:
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
$
8,014
$ 8,014
70
70
474
474
655
655
(335)
(335)
Net income (loss) attributable to stockholders . . . . . . . . . . . . . . . . . . . . . . . . $
6,732
Net income (loss) attributable to stockholders $ 6,732
Loss from discontinued operations, net of tax. . . . . . . . . . . . . . . . . . . . . . . . .
—
Loss from discontinued operations, net of tax
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
769
Income tax expense 769
Automotive interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
782
Automotive interest expense 782
(429)
Automotive interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Automotive interest income (429)
Adjustments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjustments
Transformation activities(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,735
Transformation activities(a) 1,735
(1,360)
GM Brazil indirect tax recoveries(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GM Brazil indirect tax recoveries(b) (1,360)
FAW-GM divestiture(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
164
FAW-GM divestiture(c) 164
GMI restructuring(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,138
—
GMI restructuring(d) 1,138
440
Ignition switch recall and related legal matters(e). . . . . . . . . . . . . . . . . . . .
440
Ignition switch recall and related legal matters(e)
2,905
Total adjustments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
539
2,905
Total adjustments 539
$
EBIT-adjusted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
11,783
8,393
$ 11,783
EBIT-adjusted $ 8,393
1,327
1,327
—
—
—
2017
2017
(3,864)
$
$ (3,864)
4,212
4,212
11,533
11,533
575
575
(266)
(266)
—
—
—
540
540
114
114
654
654
$
12,844
$ 12,844
________
(a) These adjustments were excluded because of a strategic decision to accelerate our transformation for the future to strengthen our core
(a) These adjustments were excluded because of a strategic decision to accelerate our transformation for the future to strengthen our core
business, capitalize on the future of personal mobility, and drive significant cost efficiencies. The adjustments primarily consist of accelerated
business, capitalize on the future of personal mobility, and drive significant cost efficiencies. The adjustments primarily consist of accelerated
depreciation, supplier-related charges, pension and other curtailment charges and employee-related separation charges in the year ended
depreciation, supplier-related charges, pension and other curtailment charges and employee-related separation charges in the year ended
December 31, 2019 and primarily employee separation charges and accelerated depreciation in the year ended December 31, 2018.
December 31, 2019 and primarily employee separation charges and accelerated depreciation in the year ended December 31, 2018.
(b) This adjustment was excluded because of the unique events associated with decisions rendered by the Superior Judicial Court of Brazil
(b) This adjustment was excluded because of the unique events associated with decisions rendered by the Superior Judicial Court of Brazil
t
resulting in retrospective recoveries of indirect taxes.
resulting in retrospective recoveries of indirect taxes.
(c) This adjustment was excluded because we divested our joint venture FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM), as
(c) This adjustment was excluded because we divested our joint venture FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM), as
a result of a strategic decision by both shareholders, allowing us to focus our resources on opportunities expected to deliver higher returns.
a result of a strategic decision by both shareholders, allowing us to focus our resources on opportunities expected to deliver higher returns.
(d) These adjustments were excluded because of a strategic decision to rationalize our core operations by exiting or significantly reducing our
(d) These adjustments were excluded because of a strategic decision to rationalize our core operations by exiting or significantly reducing our
presence in various international markets to focus resources on opportunities expected to deliver higher returns. The adjustments primarily
presence in various international markets to focus resources on opportunities expected to deliver higher returns. The adjustments primarily
consist of employee separation charges, asset impairments and supplier claims in the year ended December 31, 2018, all in Korea. The
consist of employee separation charges, asset impairments and supplier claims in the year ended December 31, 2018, all in Korea. The
adjustment in the year ended December 31, 2017 primarily consists of asset impairments and other restructuring actions in India, South
adjustment in the year ended December 31, 2017 primarily consists of asset impairments and other restructuring actions in India, South
Africa and Venezuela.
Africa and Venezuela.
(e) These adjustments were excluded because of the unique events associated with the ignition switch recall, which included various
(e) These adjustments were excluded because of the unique events associated with the ignition switch recall, which included various
investigations, inquiries and complaints from constituents.
investigations, inquiries and complaints from constituents.
21
21
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table reconciles diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted:
The following table reconciles diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted:
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Per Share
Amount
Amount
Per Share Amount
Amount
$ 7,916
$
Diluted earnings (loss) per common share . . . . . . . . . . . . . . . . $ 6,581
4.57
$ 7.916
$ 4.57
Diluted earnings (loss) per common share $ 6,581
70
Diluted loss per common share – discontinued operations . . .
—
—
Diluted loss per common share — discontinued operations . . .
70
2,905
Adjustments(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
539
Adjustments(a) 539
2,905
(416)
(188)
Tax effect on adjustments(b) . . . . . . . . . . . . . . . . . . . . . . . . . .
(416)
Tax effect on adjustments(b) (188)
— (1,111)
Tax adjustments(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Tax adjustments(c) (1,111)
$ 9,364
EPS-diluted-adjusted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,932
EPS-diluted-adjusted S 6.932
S 9,364
0.38
0.38
(0.13)
(0.13)
$
4.82
S 4.82
Per Share
Per Share
Amount
Per Share
Per Share Amount
$ (3,880) $ (2.60)
$
5.53
$ (3,880) $ (2.60)
$ 5.53
2.82
0.05
2.82
0.05
0.44
2.03
0.44
2.03
(0.14)
(0.29)
(0.14)
(0.29)
(0.78)
6.10
(0.78)
6.10
$
$
6.62
6.54
$ 6.62
S 6.54
4,212
4,212
654
654
(208)
(208)
9,099
9,099
$ 9,877
$ 9,877
________
(a)
(a) Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
MD&A for adjustment details.
MD&A for adjustment details.
(b)
(b) The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the jurisdiction to which the
The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the jurisdiction to which the
adjustment relates.
adjustment relates.
(c)
(c) In the year ended December 31, 2018, the adjustment consists of: (1) a non-recurring tax benefit related to foreign earnings; and (2) tax
In the year ended December 31, 2018, the adjustment consists of: (1) a non-recurring tax benefit related to foreign earnings; and (2) tax
effects related to U.S. tax reform legislation. In the year ended December 31, 2017, the adjustment consisted of the tax expense of $7.3
effects related to U.S. tax reform legislation. In the year ended December 31, 2017, the adjustment consisted of the tax expense of $7.3
billion related to U.S. tax reform legislation and the establishment of a valuation allowance against deferred tax assets of $2.3 billion that
billion related to U.S. tax reform legislation and the establishment of a valuation allowance against deferred tax assets of $2.3 billion that
are no longer realizable as a result of the sale of the Opel/Vauxhall Business, partially offset by tax benefits related to tax settlements. These
are no longer realizable as a result of the sale of the Opel/Vauxhall Business, partially offset by tax benefits related to tax settlements:These
adjustments were excluded because impacts of tax legislation and valuation allowances are not considered part of our core operations.
adjustments were excluded because impacts of tax legislation and valuation allowances are not considered part of our core operations.
The following table reconciles our effective tax rate under U.S. GAAP to ETR-adjusted:
The following table reconciles our effective tax rate under U.S. GAAP to ETR-adjusted:
Years Ended December 31,
Years Ended December 31,
Income
Income
before
before
income taxes
income taxes
Effective tax rate . . $
7,436
Effective tax rate . . $ 7,436
Adjustments(a) . . .
Adjustments(a) . . .
545
545
Tax adjustments(b)
Tax adjustments(b)
ETR-adjusted. . . . . $
ETR-adjusted $ 7.981
7,981
2019
2017
2018
2019 2018 2017
Income
Income
tax
tax
expense
expense
769
$
$ 769
Effective
Effective
tax rate
tax rate
Income
Income
before
before
income taxes
income taxes
10.3% $
8,549
10.3% $ 8,549
Income
Income
tax
tax
expense
expense
474
$
$ 474
Effective
Effective
tax rate
tax rate
Income
Income
before
before
income taxes
income taxes
5.5% $
11,863
5.5% $ 11,863
Income
Income
tax
tax
expense
expense
$ 11,533
$ 11,533
Effective
Effective
tax rate
tax rate
97.2%
97.2%
188
188
—
2,946
2,946
416
416
1,111
1,111
654
654
208
208
(9,099)
(9,099)
$
957
$ 957
12.0% $
11,495
12.0% $ 11,495
$
2,001
$ 2,001
17.4% $
12,517
17.4% $ 12,517
$
2,642
$ 2,642
21.1%
21.1%
__________
(a) Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
(a) Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
MD&A for adjustment details. Net income attributable to noncontrolling interests for these adjustments is included in the years ended
MD&A for adjustment details. Net income attributable to noncontrolling interests for these adjustments is included in the years ended
December 31, 2019 and 2018. The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the
December 31, 2019 and 2018. The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the
jurisdiction to which the adjustment relates.
jurisdiction to which the adjustment relates.
(b) Refer to the reconciliation of diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted within this section of the
(b) Refer to the reconciliation of diluted earnings (loss) per common share under U.S. GAAP to EPS-diluted-adjusted within this section of the
MD&A for adjustment details.
MD&A for adjustment details.
We define return on equity (ROE) as Net income (loss) attributable to stockholders for the trailing four quarters divided by
We define return on equity (ROE) as Net income (loss) attributable to stockholders for the trailing four quarters divided by
average equity for the same period. Management uses average equity to provide comparable amounts in the calculation of ROE.
average equity for the same period. Management uses average equity to provide comparable amounts in the calculation of ROE.
The following table summarizes the calculation of ROE (dollars in billions):
The following table summarizes the calculation of ROE (dollars in billions):
Net income (loss) attributable to stockholders . . . . . . . . . . . . . . . . . . . . . . . . $
6.7
Net income (loss) attributable to stockholders $ 6.7
Average equity(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
43.7
Average equity(a) $ 43.7
ROE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15.4%
ROE 15.4%
2019
2019
2018
2018
$
8.0
$ 8.0
$
37.4
$ 37.4
2017
2017
$
(3.9)
$ (3.9)
$
42.2
$ 42.2
21.4%
21.4%
(9.2)%
(9.2)%
_______
(a) Includes equity of noncontrolling interests where the corresponding earnings (loss) are included in Net income (loss) attributable to
(a) Includes equity of noncontrolling interests where the corresponding earnings (loss) are included in Net income (loss) attributable to
stockholders.
stockholders.
Years Ended December 31,
Years Ended December 31,
22
22
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table summarizes the calculation of ROIC-adjusted (dollars in billions):
The following table summarizes the calculation of ROTC -adjusted (dollars in billions):
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
EBIT-adjusted(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
8.4
EBIT-adjusted(a) $ 8.4
Average equity(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
43.7
Average equity(b) $ 43.7
Add: Average automotive debt and interest liabilities (excluding finance
Add: Average automotive debt and interest liabilities (excluding finance
leases). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14.9
leases) 14.9
Add: Average automotive net pension & OPEB liability . . . . . . . . . . . . . . . .
16.7
Add: Average automotive net pension & OPEB liability 16.7
(23.5)
Less: Average automotive net income tax asset . . . . . . . . . . . . . . . . . . . . . . .
Less: Average automotive net income tax asset (23.5)
ROIC-adjusted average net assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
51.8
ROIC-adjusted average net assets $ 51.8
ROIC-adjusted. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
16.2%
ROIC-adjusted 16.2%
$
11.8
$ 11.8
$
37.4
$ 37.4
$
12.8
$ 12.8
$
42.2
$ 42.2
14.4
14.4
18.3
18.3
(22.7)
(22.7)
$
47.4
$ 47.4
11.6
11.6
21.0
21.0
(29.3)
(29.3)
$
45.5
$ 45.5
24.9%
24.9%
28.2%
28.2%
________
(a) Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
(a) Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the
MD&A.
MD&A.
(b) Includes equity of noncontrolling interests where the corresponding earnings (loss) are included in EBIT-adjusted.
(b) Includes equity of noncontrolling interests where the corresponding earnings (loss) are included in EBIT-adjusted.
Overview Our management team has adopted a strategic plan to transform GM into the world's most valued automotive company.
Overview Our management team has adopted a strategic plan to transform GM into the world's most valued automotive company.
Our plan includes several major initiatives that we anticipate will redefine the future of personal mobility and advance our vision
Our plan includes several major initiatives that we anticipate will redefme the future of personal mobility and advance our vision
of zero crashes, zero emissions, zero congestion while also strengthening the core of our business: earning customers for life by
of zero crashes, zero emissions, zero congestion while also strengthening the core of our business: earning customers for life by
delivering winning vehicles, leading the industry in quality and safety and improving the customer ownership experience; leading
delivering winning vehicles, leading the industry in quality and safety and improving the customer ownership experience; leading
in technology and innovation, including electrification, autonomous vehicles and data connectivity; growing our brands; making
in technology and innovation, including electrification, autonomous vehicles and data connectivity; growing our brands; making
tough, strategic decisions about the markets and products in which we will invest and compete; building profitable adjacent
tough, strategic decisions about the markets and products in which we will invest and compete; building profitable adjacent
businesses; and targeting 10% core margins on an EBIT-adjusted basis.
businesses; and targeting 10% core margins on an EBIT-adjusted basis.
Our collective bargaining agreement with the UAW, which was ratified in November 2015, expired on September 14, 2019. The
Our collective bargaining agreement with the UAW, which was ratified in November 2015, expired on September 14, 2019. The
UAW went on strike on September 16, 2019, causing subsequent stoppages to most vehicle production and parts distribution across
UAW went on strike on September 16,2019, causing subsequent stoppages to most vehicle production and parts distribution across
our North America facilities. On October 25, 2019, the UAW ratified a new collectively bargained labor agreement (Labor
our North America facilities. On October 25, 2019, the UAW ratified a new collectively bargained labor agreement (Labor
Agreement). The Labor Agreement, which has a term of four years, covers the wages, hours, benefits and other terms and conditions
Agreement). The Labor Agreement, which has a term of four years, covers the wages, hours, benefits and other terms and conditions
of employment for our UAW-represented employees. The key terms and provisions of the Labor Agreement are:
of employment for our UAW-represented employees. The key terms and provisions of the Labor Agreement are:
• Lump sum ratification bonus payments to eligible employees of $11,000 and eligible temporary employees of $4,500 in
• Lump sum ratification bonus payments to eligible employees of $11,000 and eligible temporary employees of $4,500 in
November 2019 totaling $0.5 billion;
November 2019 totaling $0.5 billion;
• Lump sum payments, equivalent to 4% of qualified earnings, to eligible employees in November 2019 and October 2021,
• Lump sum payments, equivalent to 4% of qualified earnings, to eligible employees in November 2019 and October 2021,
totaling approximately $0.2 billion;
totaling approximately $0.2 billion;
• Lump sum payments of $1,000 to be made annually to eligible employees in June 2020 through June 2023, totaling
• Lump sum payments of $1,000 to be made annually to eligible employees in June 2020 through June 2023, totaling
approximately $0.2 billion;
approximately $0.2 billion;
• Gross wage increases of 3% in 2020 and 2022 for eligible employees, totaling approximately $0.4 billion during the four-
• Gross wage increases of 3% in 2020 and 2022 for eligible employees, totaling approximately $0.4 billion during the four-
year agreement;
year agreement;
• Detroit Hamtramck Assembly facility will remain open and receive a new product allocation. Lordstown Assembly,
• Detroit Hamtramck Assembly facility will remain open and receive a new product allocation. Lordstown Assembly,
Baltimore Transmission and Warren Transmission facilities will close;
Baltimore Transmission and Warren Transmission facilities will close;
• Cash severance incentive programs to qualified employees based on employee interest, eligibility and management
• Cash severance incentive programs to qualified employees based on employee interest, eligibility and management
approval; and
approval; and
• Additional manufacturing investments of approximately $7.7 billion to create or retain more than 9,000 UAW jobs during
• Additional manufacturing investments of approximately $7.7 billion to create or retain more than 9,000 UAW jobs during
the period of the Labor Agreement.
the period of the Labor Agreement.
Lump sum payments are amortized over the term of the Labor Agreement. Restructuring charges for cash severance incentive
Lump sum payments are amortized over the term of the Labor Agreement. Restructuring charges for cash severance incentive
programs were recorded in the three months ended December 31, 2019 upon receipt of both employee acceptance and management
programs were recorded in the three months ended December 31,2019 upon receipt of both employee acceptance and management
approval. We expect to offset the Labor Agreement's economics with productivity over the four-year contract period.
approval. We expect to offset the Labor Agreement's economics with productivity over the four-year contract period.
We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable impact of
We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable impact of
approximately $3.6 billion on our GMNA EBIT-adjusted in the year ended December 31, 2019. In addition, we estimate an
approximately $3.6 billion on our GMNA EBIT-adjusted in the year ended December 31, 2019. In addition, we estimate an
unfavorable pre-tax impact to Net cash provided by operating activities in our consolidated statement of cash flows of approximately
unfavorable pre-tax impact to Net cash provided by operating activities in our consolidated statement of cash flows of approximately
$5.4 billion in the year ended December 31, 2019.
$5.4 billion in the year ended December 31, 2019.
23
23
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
For the year ending December 31, 2020 we expect EPS-diluted and EPS-diluted-adjusted of between $5.75 and $6.25. We do
For the year ending December 31, 2020 we expect EPS-diluted and EPS-diluted-adjusted of between $5.75 and $6.25. We do
not consider the potential future impact of adjustments on our expected financial results.
not consider the potential future impact of adjustments on our expected fmancial results.
We face continuing market, operating and regulatory challenges in a number of countries across the globe due to, among other
We face continuing market, operating and regulatory challenges in a number of countries across the globe due to, among other
factors, weak economic conditions, competitive pressures, our product portfolio offerings, heightened emissions standards, labor
factors, weak economic conditions, competitive pressures, our product portfolio offerings, heightened emissions standards, labor
disruptions, foreign exchange volatility, rising material prices, evolving trade policy and political uncertainty. As a result of these
disruptions, foreign exchange volatility, rising material prices, evolving trade policy and political uncertainty. As a result of these
conditions, we continue to strategically assess our performance and ability to achieve acceptable returns on our invested capital,
conditions, we continue to strategically assess our performance and ability to achieve acceptable returns on our invested capital,
as well as our cost structure in order to maintain a low breakeven point. Refer to Item 1A. Risk Factors for a discussion on these
as well as our cost structure in order to maintain a low breakeven point. Refer to Item 1A. Risk Factors for a discussion on these
challenges.
challenges.
In November 2018, we announced plans to accelerate steps to improve our overall business performance, including the
In November 2018, we announced plans to accelerate steps to improve our overall business performance, including the
reorganization of global product development staffs, the realignment of manufacturing capacity in response to market-related
reorganization of global product development staffs, the realignment of manufacturing capacity in response to market-related
volume declines in passenger cars and a reduction of our salaried workforce. We expect these transformation activities to drive
volume declines in passenger cars and a reduction of our salaried workforce. We expect these transformation activities to drive
between $5.5 billion and $6.0 billion of annual cash savings by the end of 2020, consisting of $4.0 billion to $4.5 billion in cost
between $5.5 billion and $6.0 billion of annual cash savings by the end of 2020, consisting of $4.0 billion to $4.5 billion in cost
savings resulting from reductions primarily in Automotive and other cost of sales in our consolidated financial statements, witht
savings resulting from reductions primarily in Automotive and other cost of sales in our consolidated financial statements, with
the remainder in reduced capital expenditures. We have achieved $3.3 billion in cost savings since inception through staffing,
the remainder in reduced capital expenditures. We have achieved $3.3 billion in cost savings since inception through staffmg,
manufacturing and product initiatives. We are on track to reduce capital expenditures from approximately $8.5 billion to
manufacturing and product initiatives. We are on track to reduce capital expenditures from approximately $8.5 billion to
approximately $7.0 billion and expect to meet our revised cost savings target by the end of 2020. As we continue to assess our
approximately $7.0 billion and expect to meet our revised cost savings target by the end of 2020. As we continue to assess our
performance and the needs of our evolving business, additional restructuring and rationalization actions could be required. These
performance and the needs of our evolving business, additional restructuring and rationalization actions could be required. These
additional actions could give rise to future asset impairments or other charges, which may have a material impact on our results
additional actions could give rise to future asset impairments or other charges, which may have a material impact on our results
of operations. We have recorded charges of $1.8 billion in 2019 and $3.1 billion cumulatively related to our 2018 transformation
of operations. We have recorded charges of $1.8 billion in 2019 and $3.1 billion cumulatively related to our 2018 transformation
plans, which were complete at December 31, 2019. These charges are primarily considered special for EBIT-adjusted, EPS diluted-
plans, which were complete at December 31, 2019. These charges are primarily considered special for EBIT-adjusted, EPS diluted-
adjusted and adjusted automotive free cash flow purposes.
adjusted and adjusted automotive free cash flow purposes.
GMNA Industry sales in North America were 21.2 million units in the year ended December 31, 2019, representing a decrease
GMNA Industry sales in North America were 21.2 million units in the year ended December 31, 2019, representing a decrease
of 1.8% compared to the corresponding period in 2018. U.S. industry sales were 17.5 million units in the year ended December
of 1.8% compared to the corresponding period in 2018. U.S. industry sales were 17.5 million units in the year ended December
31, 2019, representing a decrease of 1.1% compared to the corresponding period in 2018.
31, 2019, representing a decrease of 1.1% compared to the corresponding period in 2018.
Our total vehicle sales in the U.S., our largest market in North America, totaled 2.9 million units for a market share of 16.5%
Our total vehicle sales in the U.S., our largest market in North America, totaled 2.9 million units for a market share of 16.5%
in the year ended December 31, 2019, representing a decrease of 0.2 percentage points compared to the corresponding period in
in the year ended December 31, 2019, representing a decrease of 0.2 percentage points compared to the corresponding period in
2018, primarily related to the UAW strike. We continue to lead the U.S. industry in market share.
2018, primarily related to the UAW strike. We continue to lead the U.S. industry in market share.
We estimate GMNA's breakeven point at the U.S. industry level to be in the range of 10.0 to 11.0 million units. We expect to
We estimate GMNA's breakeven point at the U.S. industry level to be in the range of 10.0 to 11.0 million units. We expect to
sustain a strong EBIT-adjusted margin in 2020 on the relative strength of U.S. industry light vehicle sales and our recent and
sustain a strong EBIT-adjusted margin in 2020 on the relative strength of U.S. industry light vehicle sales and our recent and
upcoming product launches, including our new full-size SUVs.
upcoming product launches, including our new full-size SUVs.
GMI Industry sales in China were 25.4 million units in the year ended December 31, 2019, representing a decrease of 4.2%
GMI Industry sales in China were 25.4 million units in the year ended December 31, 2019, representing a decrease of 4.2%
compared to the corresponding period in 2018. Our total vehicle sales in China were 3.1 million units for a market share of 12.2%
compared to the corresponding period in 2018. Our total vehicle sales in China were 3.1 million units for a market share of 12.2%
in the year ended December 31, 2019, representing a decrease of 1.6 percentage points compared to the corresponding period in
in the year ended December 31, 2019, representing a decrease of 1.6 percentage points compared to the corresponding period in
2018. Cadillac achieved 3.9% growth in vehicle sales in the year ended December 31, 2019 compared to the corresponding period
2018. Cadillac achieved 3.9% growth in vehicle sales in the year ended December 31, 2019 compared to the corresponding period
in 2018. Buick, Chevrolet, Baojun and Wuling sales were softer amid a continued weak automotive industry since the second half
in 2018. Buick, Chevrolet, Baojun and Wuling sales were softer amid a continued weak automotive industry since the second half
of 2018. Additionally, Baojun and Wuling sales were impacted by unfavorable market shifts in vehicle segments. Our Automotive
of 2018. Additionally, Baojun and Wuling sales were impacted by unfavorable market shifts in vehicle segments. Our Automotive
China JVs generated equity income of $1.1 billion in the year ended December 31, 2019. In 2020 we expect to see continued
China JVs generated equity income of $1.1 billion in the year ended December 31, 2019. In 2020 we expect to see continued
weakness in the industry with a continuation of pricing pressures, a more challenging regulatory environment related to emissions,
weakness in the industry with a continuation of pricing pressures, a more challenging regulatory environment related to emissions,
fuel consumption and new energy vehicles, and continued weakness in the Chinese Yuan against the U.S. Dollar, which will
fuel consumption and new energy vehicles, and continued weakness in the Chinese Yuan against the U.S. Dollar, which will
continue to put pressure on our operations in China. We will continue to build upon our strong brands, network, and partnerships
continue to put pressure on our operations in China. We will continue to build upon our strong brands, network, and partnerships
in China as well as continue to drive improvements in vehicle mix and cost.
in China as well as continue to drive improvements in vehicle mix and cost.
Outside of China, industry sales were 25.8 million units in the year ended December 31, 2019, representing a decrease of 3.5%
Outside of China, industry sales were 25.8 million units in the year ended December 31, 2019, representing a decrease of 3.5%
compared to the corresponding period in 2018, primarily due to decreased sales in India and Argentina. Our total vehicle sales
compared to the corresponding period in 2018, primarily due to decreased sales in India and Argentina. Our total vehicle sales
were 1.3 million units for a market share of 4.9% in the year ended December 31, 2019, representing an increase of 0.2 percentage
were 1.3 million units for a market share of 4.9% in the year ended December 31, 2019, representing an increase of 0.2 percentage
points compared to the corresponding period in 2018.
points compared to the corresponding period in 2018.
Cruise We are actively testing our autonomous vehicles in the U.S. Gated by safety and regulation, we continue to make
Cruise We are actively testing our autonomous vehicles in the U.S. Gated by safety and regulation, we continue to make
significant progress towards commercialization of a network of on-demand autonomous vehicles in the U.S.
significant progress towards commercialization of a network of on-demand autonomous vehicles in the U.S.
24
24
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
In 2019 Cruise Holdings entered into a purchase agreement with existing shareholders and new third-party investors, pursuant
In 2019 Cruise Holdings entered into a purchase agreement with existing shareholders and new third-party investors, pursuant
to which Cruise Holdings received $1.2 billion in exchange for issuing Cruise Class F Preferred Shares, including $0.7 billion
to which Cruise Holdings received $1.2 billion in exchange for issuing Cruise Class F Preferred Shares, including $0.7 billion
from General Motors Holdings LLC. All proceeds are designated exclusively for working capital and general corporate purposes
from General Motors Holdings LLC. All proceeds are designated exclusively for working capital and general corporate purposes
of Cruise. Refer to Note 20 to our consolidated financial statements for further details.
of Cruise. Refer to Note 20 to our consolidated financial statements for further details.
Corporate The ignition switch recall has led to various inquiries, investigations, subpoenas, requests for information and
Corporate The ignition switch recall has led to various inquiries, investigations, subpoenas, requests for information and
complaints from agencies or other representatives of U.S., federal, state and Canadian governments. In addition these and other
complaints from agencies or other representatives of U.S., federal, state and Canadian governments. In addition these and other
recalls have resulted in a number of claims and lawsuits. Such lawsuits and investigations could result in the imposition of material
recalls have resulted in a number of claims and lawsuits. Such lawsuits and investigations could result in the imposition of material
damages, fines, civil consent orders, civil and criminal penalties or other remedies. Refer to Note 16 to our consolidated financial
damages, fines, civil consent orders, civil and criminal penalties or other remedies. Refer to Note 16 to our consolidated financial
statements for additional information.
statements for additional information.
aa
Contingently Issuable Shares Under the Amended and Restated Master Sale and Purchase Agreement between GM and MLC,
Contingently Issuable Shares Under the Amended and Restated Master Sale and Purchase Agreement between GM and MLC,
GM may be obligated to issue Adjustment Shares of our common stock if allowed general unsecured claims against the GUC
GM may be obligated to issue Adjustment Shares of our common stock if allowed general unsecured claims against the GUC
Trust, as estimated by the Bankruptcy Court, exceed $35.0 billion. Refer to Note 16 to our consolidated financial statements for
Trust, as estimated by the Bankruptcy Court, exceed $35.0 billion. Refer to Note 16 to our consolidated financial statements for
a description of the contingently issuable Adjustment Shares.
a description of the contingently issuable Adjustment Shares.
Automotive Financing - GM Financial Summary and Outlook We believe that offering a comprehensive suite of financing
Automotive Financing - GM Financial Summary and Outlook We believe that offering a comprehensive suite of financing
products will generate incremental sales of our vehicles, drive incremental GM Financial earnings and help support our sales
products will generate incremental sales of our vehicles, drive incremental GM Financial earnings and help support our sales
throughout various economic cycles. GM Financial's leasing program is exposed to residual values, which are heavily dependent
throughout various economic cycles. GM Financial's leasing program is exposed to residual values, which are heavily dependent
on used vehicle prices. Used vehicle prices decreased 3% in 2019 compared to 2018. We expect a decrease of 3% to 4% in 2020
on used vehicle prices. Used vehicle prices decreased 3% in 2019 compared to 2018. We expect a decrease of 3% to 4% in 2020
compared to 2019, primarily due to the elevated supply of used vehicles in the industry. The following table summarizes the
compared to 2019, primarily due to the elevated supply of used vehicles in the industry. The following table summarizes the
residual value as well as the number of units included in GM Financial equipment on operating leases, net by vehicle type (units
residual value as well as the number of units included in GM Financial equipment on operating leases, net by vehicle type (units
in thousands):
in thousands):
Residual Value
Residual Value
Crossovers . . . . . . . . . . . . . . . . . . . $
15,950
Crossovers $ 15,950
Trucks. . . . . . . . . . . . . . . . . . . . . . .
7,256
Trucks 7,256
SUVs . . . . . . . . . . . . . . . . . . . . . . .
3,917
SUVs 3,917
3,276
Cars. . . . . . . . . . . . . . . . . . . . . . . . .
Cars 3,276
Total . . . . . . . . . . . . . . . . . . . . . . . . $
30,399
Total $ 30,399
December 31, 2019
December 31, 2019
Units
Units
972
972
288
288
108
108
238
238
1,606
1,606
Percentage
Residual Value
Percentage Residual Value
60.5% $
15,057
60.5% $ 15,057
18.0%
7,299
18.0% 7,299
6.7%
4,160
6.7% 4,160
4,884
14.8%
14.8% 4,884
100.0% $
31,400
100.0% $ 31,400
December 31, 2018
December 31, 2018
Units
Units
Percentage
Percentage
917
917
296
296
111
111
379
379
1,703
1,703
53.8%
53.8%
17.4%
17.4%
6.5%
6.5%
22.3%
22.3%
100.0%
100.0%
GM Financial's penetration of our retail sales in the U.S. decreased to 43% in the year ended December 31, 2019 from 49% in
GM Financial's penetration of our retail sales in the U.S. decreased to 43% in the year ended December 31, 2019 from 49% in
2018. Penetration levels vary depending on incentive financing programs available and competing third-party financing products
2018. Penetration levels vary depending on incentive financing programs available and competing third-party financing products
in the market. GM Financial's prime loan originations as a percentage of total loan originations in North America decreased to
in the market. GM Financial's prime loan originations as a percentage of total loan originations in North America decreased to
68% in 2019 from 72% in 2018. In the year ended December 31, 2019, GM Financial's revenue consisted of leased vehicle income
68% in 2019 from 72% in 2018. In the year ended December 31, 2019, GM Financial's revenue consisted of leased vehicle income
of 69%, retail finance charge income of 23%, and commercial finance charge income of 5%.
of 69%, retail finance charge income of 23%, and commercial finance charge income of 5%.
Consolidated Results We review changes in our results of operations under five categories: volume, mix, price, cost and other.
Consolidated Results We review changes in our results of operations under five categories: volume, mix, price, cost and other.
Volume measures the impact of changes in wholesale vehicle volumes driven by industry volume, market share and changes in
Volume measures the impact of changes in wholesale vehicle volumes driven by industry volume, market share and changes in
dealer stock levels. Mix measures the impact of changes to the regional portfolio due to product, model, trim, country and option
dealer stock levels. Mix measures the impact of changes to the regional portfolio due to product, model, trim, country and option
penetration in current year wholesale vehicle volumes. Price measures the impact of changes related to Manufacturer’s Suggested
penetration in current year wholesale vehicle volumes. Price measures the impact of changes related to Manufacturer's Suggested
Retail Price and various sales allowances. Cost primarily includes: (1) material and freight; (2) manufacturing, engineering,
Retail Price and various sales allowances. Cost primarily includes: (1) material and freight; (2) manufacturing, engineering,
advertising, administrative and selling and warranty expense; and (3) non-vehicle related activity. Other primarily includes foreign
advertising, administrative and selling and warranty expense; and (3) non-vehicle related activity. Other primarily includes foreign
exchange and non-vehicle related automotive revenues as well as equity income or loss from our nonconsolidated affiliates. Refer
exchange and non-vehicle related automotive revenues as well as equity income or loss from our nonconsolidated affiliates. Refer
to the regional sections of this MD&A for additional information.
to the regional sections of this MD&A for additional information.
25
25
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Total Net Sales and Revenue
Total Net Sales and Revenue
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
Favorable/
Favorable/
(
(Unfavorable)
)
(Unfavorable)
GMNA. . . . . . . . . . . . . . . . . . . . . $ 106,366
GMNA $ 106,366
GMI . . . . . . . . . . . . . . . . . . . . . . .
16,111
GMI 16,111
Corporate . . . . . . . . . . . . . . . . . . .
220
Corporate 220
Automotive . . . . . . . . . . . . . . . . .
122,697
Automotive 122,697
Cruise. . . . . . . . . . . . . . . . . . . . . .
100
Cruise 100
GM Financial. . . . . . . . . . . . . . . .
14,554
GM Financial 14,554
(114)
Eliminations/Reclassifications . .
(114)
Eliminations/Reclassifications
Total net sales and revenue . . . . . $ 137,237
Total net sales and revenue $ 137,237
$ 113,792
$ 113,792
19,148
19,148
203
203
133,143
133,143
—
14,016
14,016
(110)
(110)
$ 147,049
$ 147,049
(7,426)
$
$ (7,426)
(3,037)
(3,037)
17
17
(10,446)
(10,446)
100
100
538
538
(4)
(4)
(9,812)
$
$ (9,812)
________
n.m. = not meaningful
11.111. = not meaningful
Automotive and Other Cost of Sales
Automotive and Other Cost of Sales
%
Volume
Volume
1.7
$ (10.0) $ 1.7
Variance Due To
Variance Due To
Price
Mix
Mix Price
(Dollars in billions)
(Dollars in billions)
(6.5)% $ (10.0) $
1.3
$
$ 1.3
(6.5)%
(15.9)% $ (2.2) $ (0.3) $
0.5
$ (2.2) $ (0.3) $ 0.5
(15.9)%
8.4 %
8.4 %
(7.8)% $ (12.2) $
(7.8)%
n.m.
n.m.
3.8 %
3.8 %
$
(3.6)%
0.1
$ 0.1
(3.6)%
(6.7)% $ (12.2) $
1.5
$ (12.2) $ 1.5
(6.7)%
1.5
$ (12.2) $ 1.5
$
1.9
$ 1.9
$
1.9
$ 1.9
Other
Other
$ (0.5)
$ (0.5)
$ (1.1)
$ (1.1)
$ —
$ (1.6)
$ (1.6)
$
0.1
$ 0.1
$
0.5
$ 0.5
$ (0.1)
$ (0.1)
$ (1.0)
$ (1.0)
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
Favorable/
Favorable/
(
(Unfavorable)
)
(Unfavorable)
%
Volume
Volume
94,582
GMNA. . . . . . . . . . . . . . . . . . . . . $
GMNA $ 94,582
GMI . . . . . . . . . . . . . . . . . . . . . . .
14,967
GMI 14,967
Corporate . . . . . . . . . . . . . . . . . . .
81
Corporate 81
Cruise. . . . . . . . . . . . . . . . . . . . . .
1,026
Cruise 1,026
Eliminations. . . . . . . . . . . . . . . . .
(5)
Eliminations (5)
Total automotive and other cost
Total automotive and other cost
of sales . . . . . . . . . . . . . . . . . . . $ 110,651
of sales $ 110,651
99,445
$
$ 99,445
20,418
20,418
178
178
715
715
(100)
(100)
4,863
$
$ 4,863
5,451
5,451
97
97
(311)
(311)
(95)
(95)
7.2
$ 7.2
1.9
$ 1.9
4.9 % $
4.9 %
26.7 % $
26.7 %
54.5 %
54.5 %
(43.5)%
(43.5)%
(95.0)%
(95.0)%
$ 120,656
$ 120,656
$
10,005
$ 10,005
8.3 % $
8.3 %
9.1
$ 9.1
$ (1.8) $
1.6
$ (1.8) $ 1.6
$
1.1
$ 1.1
Other
Other
Variance Due To
Variance Due To
Cost
Mix
Mix Cost
(Dollars in billions)
(Dollars in billions)
$ (1.7) $ (1.0) $
0.3
$ (1.7) $ (1.0) $ 0.3
$
$ — $
0.6
2.9
$ 0.6
$ - $ 2.9
$ — $ — $
0.1
$ - $ - $ 0.1
$ (0.3)
$ (0.3)
$ — $ —
$ -S -
The most significant element of our Automotive and other cost of sales is material cost, which makes up approximately two-
The most significant element of our Automotive and other cost of sales is material cost, which makes up approximately two-
thirds of the total amount. The remaining portion includes labor costs, depreciation and amortization, engineering, freight and
thirds of the total amount. The remaining portion includes labor costs, depreciation and amortization, engineering, freight and
product warranty and recall campaigns.
product warranty and recall campaigns.
Factors that most significantly influence a region's profitability are industry volume, market share, and the relative mix of vehicles
Factors that most significantly influence a region's profitability are industry volume, market share, and the relative mix of vehicles
(trucks, crossovers, cars) sold. Variable profit is a key indicator of product profitability. Variable profit is defined as revenue less
(trucks, crossovers, cars) sold. Variable profit is a key indicator of product profitability. Variable profit is defined as revenue less
material cost, freight, the variable component of manufacturing expense and warranty and recall-related costs. Vehicles with higher
material cost, freight, the variable component of manufacturing expense and warranty and recall-related costs. Vehicles with higher
selling prices generally have higher variable profit. Refer to the regional sections of this MD&A for additional information on
selling prices generally have higher variable profit. Refer to the regional sections of this MD&A for additional information on
volume and mix.
volume and mix.
In the year ended December 31, 2019, favorable Cost was primarily due to: (1) decreased engineering, manufacturing and other
In the year ended December 31, 2019, favorable Cost was primarily due to: (1) decreased engineering, manufacturing and other
costs of $1.5 billion, primarily related to cost savings associated with transformation activities; (2) a benefit of $1.4 billion related
costs of $1.5 billion, primarily related to cost savings associated with transformation activities; (2) a benefit of $1.4 billion related
to the retrospective recoveries of indirect taxes in Brazil; (3) charges of $1.1 billion primarily in employee separation charges and
to the retrospective recoveries of indirect taxes in Brazil; (3) charges of $1.1 billion primarily in employee separation charges and
asset impairments in Korea in 2018; and (4) favorable material performance of $0.8 billion related to carryover vehicles; partially
asset impairments in Korea in 2018; and (4) favorable material performance of $0.8 billion related to carryover vehicles; partially
offset by (5) increased material cost of $1.2 billion related to vehicles launched within the last twelve months incorporating
offset by (5) increased material cost of $1.2 billion related to vehicles launched within the last twelve months incorporating
significant exterior and/or interior changes (Majors); (6) increase in large campaigns and other warranty-related costs of $1.0
significant exterior and/or interior changes (Majors); (6) increase in large campaigns and other warranty-related costs of $1.0
billion; (7) increased raw material and freight costs related to carryover vehicles of $0.5 billion; and (8) a net increase in charges
billion; (7) increased raw material and freight costs related to carryover vehicles of $0.5 billion; and (8) a net increase in charges
of $0.4 billion primarily in accelerated depreciation and supplier-related charges resulting from transformation activities. In the
of $0.4 billion primarily in accelerated depreciation and supplier-related charges resulting from transformation activities. In the
year ended December 31, 2019 favorable Other was due to the foreign currency effect resulting from the weakening of the Brazilian
year ended December 31,2019 favorable Other was due to the foreign currency effect resulting from the weakening of the Brazilian
Real, Korean Won, Argentine Peso and other currencies against the U.S. Dollar.
Real, Korean Won, Argentine Peso and other currencies against the U.S. Dollar.
n
26
26
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Automotive and Other Selling, General and Administrative Expense
Automotive and Other Selling, General and Administrative Expense
Years Ended December 31,
Years Ended December 31,
Year Ended
Year Ended
2019 vs. 2018 Changeg
2019 vs. 2018 Change
Favorable/
Favorable/
2019
(Unfavorable)
2019 2018 2017 (Unfavorable)
2018
2017
%
Automotive and other selling, general and administrative
Automotive and other selling, general and administrative
expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
12.0%
expense $ 8,491 $ 9,650 $ 9,570 $ 1,159 12.0%
8,491
9,650
9,570
1,159
$
$
$
In the year ended December 31, 2019, Automotive and other selling, general and administrative expense decreased primarily
In the year ended December 31, 2019, Automotive and other selling, general and administrative expense decreased primarily
due to charges of $0.4 billion for ignition switch related legal matters in 2018 and decreased other costs of $0.5 billion primarily
due to charges of $0.4 billion for ignition switch related legal matters in 2018 and decreased other costs of $0.5 billion primarily
related to cost savings associated with transformation activities.
related to cost savings associated with transformation activities.
Interest Income and Other Non-operating Income, net
Interest Income and Other Non-operating Income, net
Years Ended December 31,
Years Ended December 31,
Year Ended
Year Ended
2019 vs. 2018 Changeg
2019 vs. 2018 Change
Interest income and other non-operating income, net . . . . . $
(43.4)%
Interest income and other non-operating income, net $ 1,469 $ 2,596 $ 1,645 $ (1,127) (43.4)%
1,469
2,596
1,645
$
$
2019
%
2017
2019 2018 2017 (Unfavorable) %
2018
Favorable/
Favorable/
(Unfavorable)
(1,127)
$
In the year ended December 31, 2019, Interest income and other non-operating income, net decreased primarily due to decreased
In the year ended December 31,2019, Interest income and other non-operating income, net decreased primarily due to decreased
non-service pension income of $0.9 billion, losses related to our investment in Lyft, Inc. (Lyft) of $0.2 billion and losses related
non-service pension income of $0.9 billion, losses related to our investment in Lyft, Inc. (Lyft) of $0.2 billion and losses related
to the FAW-GM divestiture of $0.2 billion.
to the FAW-GM divestiture of $0.2 billion.
The following table summarizes gains (losses) related to our investment in Lyft and PSA warrants:
The following table summarizes gains (losses) related to our investment in Lyft and PSA warrants:
(74) $
Gains (losses) related to Lyft . . . . . . . . . . . . . . . . . . . . . . . . $
142
Gains (losses) related to Lyft $ (74) $ 142
116
154
Gains (losses) related to PSA warrants. . . . . . . . . . . . . . . . .
116
Gains (losses) related to PSA warrants 154
$
Total gains (losses) on investments . . . . . . . . . . . . . . . . . . . $
258
80
S 258
Total gains (losses) on investments $ 80
2019
2019
2018
2018
Favorable/
Favorable/
2017
(Unfavorable)
2017 (Unfavorable)
(216)
$
— $
$ — $ (216)
(56)
38
(56) 38
(56) $
(178)
$
S (56) $ (178)
cyo
%
n.m.
n.m.
32.8 %
32.8 %
(69.0)%
(69.0)%
Years Ended December 31,
Years Ended December 31,
Year Ended
Year Ended
2019 vs. 2018 Changeg
2019 vs. 2018 Change
________
n.m. = not meaningful
n.m. = not meaningful
Income Tax Expense
Income Tax Expense
Years Ended December 31,
Years Ended December 31,
Year Ended
Year Ended
2019 vs. 2018 Changeg
2019 vs. 2018 Change
Income tax expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(62.2)%
Income tax expense $ 769 $ 474 $ 11,533 $ (295) (62.2)%
Favorable/
Favorable/
2019
(Unfavorable)
2019 2018 2017 (Unfavorable)
(295)
$
$
2017
11,533
769
474
2018
$
%
In the year ended December 31, 2019, Income tax expense increased primarily due to the absence of certain tax benefits related
In the year ended December 31, 2019, Income tax expense increased primarily due to the absence of certain tax benefits related
to foreign dividends which occurred in 2018, partially offset by a decrease in 2019 pre-tax income, U.S. tax benefits from foreign
to foreign dividends which occurred in 2018, partially offset by a decrease in 2019 pre-tax income, U.S. tax benefits from foreign
activity and tax benefits related to the release of valuation allowances.
activity and tax benefits related to the release of valuation allowances.
In the year ended December 31, 2018, Income tax expense decreased primarily due to the absence of certain expense items
In the year ended December 31, 2018, Income tax expense decreased primarily due to the absence of certain expense items
which occurred in 2017, including $7.3 billion of tax expense related to U.S. tax reform and $2.3 billion of tax expense related to
which occurred in 2017, including $7.3 billion of tax expense related to U.S. tax reform and $2.3 billion of tax expense related to
the recording of a valuation allowance on the sale of the Opel/Vauxhall Business, combined with the impact of a lower U.S.
the recording of a valuation allowance on the sale of the Opel/Vauxhall Business, combined with the impact of a lower U.S.
statutory tax rate and pre-tax income in 2018.
statutory tax rate and pre-tax income in 2018.
For the year ended December 31, 2019 our ETR-adjusted was 12.0%. We expect our adjusted effective tax rate to be approximately
For the year ended December 31,2019 our ETR-adjusted was 12.0%. We expect our adjusted effective tax rate to be approximately
20% for the year ending December 31, 2020, primarily due to certain 2019 tax items that will not reoccur.
20% for the year ending December 31, 2020, primarily due to certain 2019 tax items that will not reoccur.
Refer to Note 17 to our consolidated financial statements for additional information related to Income tax expense.
Refer to Note 17 to our consolidated fmancial statements for additional information related to Income tax expense.
27
27
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GM North America
GM North America
Years Ended December 31, Favorable/
Favorable/
2019
(Unfavorable)
2018
)
(
2019 2018 (Unfavorable)
%
Volume
Cost
Volume Mix Price Cost
Mix
Variance Due To
Variance Due To
Price
Other
Other
Total net sales and revenue. . $ 106,366
$ (7,426)
Total net sales and revenue. . $ 106,366 $ 113,792 $ (7,426)
EBIT-adjusted. . . . . . . . . . . . $
$ (2,565)
8,204
EBIT-adjusted $ 8,204 $ 10,769 $ (2,565)
EBIT-adjusted margin . . . . .
EBIT-adjusted margin
7.7%
(1.8)%
9.5%
7.7% 9.5% (1.8)%
$ 113,792
$ 10,769
(Dollars in billions)
(Dollars in billions)
(6.5)% $(10.0) $ 1.7
$ 1.3
(6.5)% $(10.0) $ 1.7 $ 1.3
(23.8)% $ (2.8) $ — $ 1.3
$ (2.8) $ — $ 1.3
(23.8)%
$ (0.5)
$ (0.5)
$ (1.2) $ —
$ (1.2) $ —
Wholesale vehicle sales . . . .
Wholesale vehicle sales . . . .
(Vehicles in thousands)
(Vehicles in thousands)
3,214
(341)
3,555
3,214 3,555 (341)
(9.6)%
(9.6)%
GMNA Total Net Sales and Revenue In the year ended December 31, 2019, Total net sales and revenue decreased primarily
GMNA Total Net Sales and Revenue In the year ended December 31, 2019, Total net sales and revenue decreased primarily
due to: (1) decreased net wholesale volumes due to lost production resulting from the UAW strike, a decrease in sales of passenger
due to: (1) decreased net wholesale volumes due to lost production resulting from the UAW strike, a decrease in sales of passenger
cars, full-size SUVs and fleet vehicles, partially offset by an increase in sales of crossover vehicles and higher planned downtime
cars, full-size SUVs and fleet vehicles, partially offset by an increase in sales of crossover vehicles and higher planned downtime
in 2018 in preparation for the launch of full-size pickup trucks; and (2) unfavorable Other primarily due to the foreign currency
in 2018 in preparation for the launch of full-size pickup trucks; and (2) unfavorable Other primarily due to the foreign currency
effect resulting from the weakening of the Canadian Dollar against the U.S. Dollar; partially offset by (3) favorable mix associated
effect resulting from the weakening of the Canadian Dollar against the U.S. Dollar; partially offset by (3) favorable mix associated
with a decrease in sales of passenger cars partially offset by a decrease in sales of full-size SUVs; and (4) favorable pricing for
with a decrease in sales of passenger cars partially offset by a decrease in sales of full-size SUVs; and (4) favorable pricing for
Majors of $1.3 billion associated with the launch of our new full-size pickup trucks.
Majors of $1.3 billion associated with the launch of our new full-size pickup trucks.
GMNA EBIT-Adjusted The most significant factors that influence profitability are industry volume and market share. While
GMNA EBIT-Adjusted The most significant factors that influence profitability are industry volume and market share. While
not as significant as industry volume and market share, another factor affecting profitability is the relative mix of vehicles sold.
not as significant as industry volume and market share, another factor affecting profitability is the relative mix of vehicles sold.
Trucks, crossovers and cars sold currently have a variable profit of approximately 170%, 60% and 30% of our GMNA portfolio
Trucks, crossovers and cars sold currently have a variable profit of approximately 170%, 60% and 30% of our GMNA portfolio
on a weighted-average basis.
on a weighted-average basis.
In the year ended December 31, 2019, EBIT-adjusted decreased primarily due to: (1) decreased net wholesale volumes; and (2)
In the year ended December 31, 2019, EBIT-adjusted decreased primarily due to: (1) decreased net wholesale volumes; and (2)
unfavorable Cost due to increased vehicle content for Majors of $1.1 billion, an increase in large campaigns and other warranty-
unfavorable Cost due to increased vehicle content for Majors of $1.1 billion, an increase in large campaigns and other warranty-
related cost of $1.1 billion, decreased non-service pension income of $0.7 billion, increased raw material and freight costs of $0.4
related cost of $1.1 billion, decreased non-service pension income of $0.7 billion, increased raw material and freight costs of $0.4
billion related to carryover vehicles, increased depreciation and amortization expense of $0.3 billion; partially offset by engineering,
billion related to carryover vehicles, increased depreciation and amortization expense of $0.3 billion; partially offset by engineering,
manufacturing and administrative cost savings of $1.8 billion primarily related to transformation activities and favorable materials
manufacturing and administrative cost savings of $1.8 billion primarily related to transformation activities and favorable materials
performance of $0.7 billion related to carryover vehicles; partially offset by (3) favorable pricing.
performance of $0.7 billion related to carryover vehicles; partially offset by (3) favorable pricing.
f
GM International
GM International
Years Ended December 31,
Years Ended December 31,
2018
2019
2019 2018
Favorable/
Favorable/
(Unfavorable)
)
(
(Unfavorable)
Total net sales and revenue. . $ 16,111
Total net sales and revenue. .
EBIT (loss)-adjusted. . . . . . . $
(202)
EBIT (loss)-adjusted
EBIT (loss)-adjusted margin
EBIT (loss)-adjusted margin
Equity income —
Equity income —
$ 19,148
$ 16,111 $ 19,148
423
$
$ (202) $ 423
(1.3)%
2.2%
(1.3)% 2.2%
$ (3,037)
$ (3,037)
$
(625)
$ (625)
(3.5)%
(3.5)%
Automotive China . . . . . . . $ 1,132
1,981
Automotive China $ 1,132 $ 1,981
$
$
(849)
$ (849)
(42.9)%
(42.9)%
%
Variance Due To
Variance Due To
Volume
Other
Price
Volume Mix Price Cost Other
(Dollars in billions)
(Dollars in billions)
(15.9)% $ (2.2) $ (0.3) $ 0.5
$ (1.1)
$ (2.2) $ (0.3) $ 0.5 $ (1.1)
(15.9)%
$ (0.3) $ (0.3) $ 0.5
$ (1.1)
n.m.
$ (0.3) $ (0.3) $ 0.5 $ 0.5 $ (1.1)
n.m.
$ 0.5
Cost
Mix
EBIT (loss)-adjusted —
EBIT (loss) -adjusted —
$
excluding Equity income. . $ (1,334)
224
$ (1,558)
$ 224
excluding Equity income $ (1,334) $ (1,558)
(Vehicles in thousands)
(Vehicles in thousands)
995
1,152
995 1,152
Wholesale vehicle sales . . . .
Wholesale vehicle sales . . . .
(157)
(157)
14.4 %
14.4 %
(13.6)%
(13.6)%
________
n.m. = not meaningful
11.111. = not meaningful
The vehicle sales of our Automotive China JVs are not recorded in Total net sales and revenue. The results of our joint ventures
The vehicle sales of our Automotive China JVs are not recorded in Total net sales and revenue. The results of our joint ventures
are recorded in Equity income, which is included in EBIT-adjusted above.
are recorded in Equity income, which is included in EBIT-adjusted above.
GMI Total Net Sales and Revenue In the year ended December 31, 2019, Total net sales and revenue decreased primarily due
GMI Total Net Sales and Revenue In the year ended December 31, 2019, Total net sales and revenue decreased primarily due
to: (1) decreased wholesale volumes in Asia/Pacific and Argentina primarily driven by lower industry volumes, partially offset by
to: (1) decreased wholesale volumes in Asia/Pacific and Argentina primarily driven by lower industry volumes, partially offset by
increased volumes in Brazil primarily due to increased sales of the Chevrolet Onix; (2) unfavorable mix in Asia/Pacific and in
increased volumes in Brazil primarily due to increased sales of the Chevrolet Onix; (2) unfavorable mix in Asia/Pacific and in
Brazil, primarily due to increased sales of the Chevrolet Onix; and (3) unfavorable Other primarily due to the foreign currency
Brazil, primarily due to increased sales of the Chevrolet Onix; and (3) unfavorable Other primarily due to the foreign currency
28
28
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
effect resulting from the weakening of the Argentine Peso and Brazilian Real against the U.S. Dollar; partially offset by (4) favorable
effect resulting from the weakening of the Argentine Peso and Brazilian Real against the U.S. Dollar: partially offset by (4) favorable
pricing related to carryover vehicles in Argentina and Brazil.
pricing related to carryover vehicles in Argentina and Brazil.
ff
GMI EBIT (loss)-Adjusted In the year ended December 31, 2019, EBIT (loss)-adjusted increased primarily due to: (1)
GMI EBIT (loss)-Adjusted In the year ended December 31, 2019, EBIT (loss)-adjusted increased primarily due to: (1)
unfavorable mix in Asia/Pacific and the Middle East; (2) unfavorable volume; and (3) unfavorable Other primarily due to decreased
unfavorable mix in Asia/Pacific and the Middle East; (2) unfavorable volume; and (3) unfavorable Other primarily due to decreased
equity income and the foreign currency effect resulting from the weakening of the Argentine Peso against the U.S. Dollar; partially
equity income and the foreign currency effect resulting from the weakening of the Argentine Peso against the U.S. Dollar; partially
offset by (4) favorable fixed cost in Australia, Korea and Argentina; and (5) favorable pricing.
offset by (4) favorable fixed cost in Australia, Korea and Argentina; and (5) favorable pricing.
We view the Chinese market as important to our global growth strategy and are employing a multi-brand strategy led by our
We view the Chinese market as important to our global growth strategy and are employing a multi-brand strategy led by our
Buick, Chevrolet and Cadillac brands. In the coming years we plan to leverage our global architectures to increase the number of
Buick, Chevrolet and Cadillac brands. In the coming years we plan to leverage our global architectures to increase the number of
product offerings under the Buick, Chevrolet and Cadillac brands in China and continue to grow our business under the local
product offerings under the Buick, Chevrolet and Cadillac brands in China and continue to grow our business under the local
Baojun and Wuling brands, with Baojun focusing its expansion in less developed cities and markets. We operate in the Chinese
Baojun and Wuling brands, with Baojun focusing its expansion in less developed cities and markets. We operate in the Chinese
market through a number of joint ventures and maintaining strong relationships with our joint venture partners is an important
market through a number of joint ventures and maintaining strong relationships with our joint venture partners is an important
part of our China growth strategy.
part of our China growth strategy.
The following table summarizes certain key operational and financial data for the Automotive China JVs (vehicles in thousands):
The following table summarizes certain key operational and fmancial data for the Automotive China JVs (vehicles in thousands):
Wholesale vehicle sales including vehicles exported to markets outside of China . . .
3,244
3,244
Wholesale vehicle sales including vehicles exported to markets outside of China . .
Total net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
39,123
Total net sales and revenue $ 39,123
2,258
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net income $ 2,258
4,140
4,030
4,140
4,030
$
$
50,065
50,316
$ 50,316 $ 50,065
3,984
$
3,992
$
$ 3,984
$ 3,992
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
8,609
$
6,257
Cash and cash equivalents S 6.257 $ 8,609
496
$
109
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Debt S 109 $ 496
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Cruise
Cruise
Years Ended December 31,
2019 vs. 2018 Change
Years Ended December 31, 2019 vs. 2018 Change
Favorable/
Favorable/
2019
(Unfavorable)
2019 2018 2017 (Unfavorable)
2018
2017
%
Total net sales and revenue(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
n.m.
Total net sales and revenue(a) $ 100 S — $ — $ 100 n.m.
EBIT (loss)-adjusted. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (1,004) $
(37.9)%
EBIT (loss)-adjusted $ (1.004) $ (728) $ (613) $ (276) (37.9)%
(613) $
(728) $
— $
— $
(276)
100
100
$
________
n.m. = not meaningful
n.m. = not meaningful
(a) Reclassified to Interest income and other non-operating income, net in our consolidated income statement in the year ended December 31, 2019.
(a) Reclassified to Interest income and other non-operating income, net in our consolidated income statement in the year ended December 31, 2019.
Cruise EBIT (Loss)-Adjusted In the year ended December 31, 2019, EBIT (loss)-adjusted increased primarily due to increased
Cruise EBIT (Loss)-Adjusted In the year ended December 31, 2019, EBIT (loss)-adjusted increased primarily due to increased
engineering costs as we progress towards the commercialization of autonomous vehicles.
engineering costs as we progress towards the commercialization of autonomous vehicles.
GM Financial
GNI Financial
Years Ended December 31,
2019 vs. 2018 Change
2019
2019
Total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $14,554
Total revenue $14,554
726
Provision for loan losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Provision for loan losses $ 726
EBT-adjusted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,104
EBT-adjusted $ 2,104
Average debt outstanding (dollars in billions) . . . . . . . . . . . . . . . . . $
91.2
Average debt outstanding (dollars in billions) $ 91.2
Effective rate of interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.0%
Effective rate of interest paid 4.0%
2018
2018
$14,016
$14,016
642
$
$ 642
$ 1,893
$ 1,893
$
85.1
$ 85.1
2017
2017
$12,151
$12,151
757
$
$ 757
$ 1,196
$ 1,196
$
74.9
$ 74.9
Amount
Amount
$
538
$ 538
84
$
$ 84
$
211
$ 211
$
6.1
$ 6.1
3.8%
3.8%
3.4%
3.4%
0.2%
0.2%
%
%
3.8%
3.8%
13.1%
13.1%
11.1%
11.1%
7.2%
7.2%
GM Financial Revenue In the year ended December 31, 2019, Total revenue increased primarily due to increased finance
GM Financial Revenue In the year ended December 31, 2019, Total revenue increased primarily due to increased fmance
charge income of $0.4 billion due to growth in the retail and commercial finance receivables portfolios and increased leased vehicle
charge income of $0.4 billion due to growth in the retail and commercial fmance receivables portfolios and increased leased vehicle
income of $0.1 billion.
income of $0.1 billion.
29
29
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GM Financial EBT-Adjusted In the year ended December 31, 2019, EBT-adjusted increased primarily due to: (1) increased
GM Financial EBT-Adjusted In the year ended December 31, 2019, EBT-adjusted increased primarily due to: (1) increased
finance charge income of $0.4 billion due to growth in the retail and commercial finance receivables portfolios; (2) increased
finance charge income of $0.4 billion due to growth in the retail and commercial fmance receivables portfolios; (2) increased
leased vehicle income net of leased vehicle expenses of $0.3 billion primarily due to gains on a higher volume of lease terminations;
leased vehicle income net of leased vehicle expenses of $0.3 billion primarily due to gains on a higher volume of lease terminations;
partially offset by (3) increased interest expense of $0.4 billion due to an increase in average debt outstanding resulting from
partially offset by (3) increased interest expense of $0.4 billion due to an increase in average debt outstanding resulting from
growth in earning assets and an increase in the effective rate of interest on debt.
growth in earning assets and an increase in the effective rate of interest on debt.
Liquidity and Capital Resources We believe that our current level of cash and cash equivalents, marketable debt securities and
Liquidity and Capital Resources We believe that our current level of cash and cash equivalents, marketable debt securities and
availability under our revolving credit facilities will be sufficient to meet our liquidity needs. We expect to have substantial cash
availability under our revolving credit facilities will be sufficient to meet our liquidity needs. We expect to have substantial cash
requirements going forward, which we plan to fund through total available liquidity and cash flows generated from operations and
requirements going forward, which we plan to fund through total available liquidity and cash flows generated from operations and
future debt issuances. We also maintain access to the capital markets and may issue debt or equity securities from time to time,
future debt issuances. We also maintain access to the capital markets and may issue debt or equity securities from time to time,
which may provide an additional source of liquidity. Our future uses of cash, which may vary from time to time based on market
which may provide an additional source of liquidity. Our future uses of cash, which may vary from time to time based on market
conditions and other factors, are focused on the three objectives of our capital allocation program: (1) reinvest in our business at
conditions and other factors, are focused on the three objectives of our capital allocation program: (1) reinvest in our business at
an average target ROIC-adjusted rate of 20% or greater; (2) maintain a strong investment-grade balance sheet, including a target
an average target ROIC-adjusted rate of 20% or greater; (2) maintain a strong investment-grade balance sheet, including a target
average automotive cash balance of $18 billion; and (3) return available cash to shareholders. Our senior management evaluates
average automotive cash balance of $18 billion; and (3) return available cash to shareholders. Our senior management evaluates
our capital allocation program on an ongoing basis and recommends any modifications to the program to our Board of Directors,
our capital allocation program on an ongoing basis and recommends any modifications to the program to our Board of Directors,
not less than once annually.
not less than once annually.
Our known current and future material uses of cash include, among other possible demands: (1) capital expenditures of
Our known current and future material uses of cash include, among other possible demands: (1) capital expenditures of
approximately $7.0 billion in 2020 in addition to payments for engineering and product development activities; (2) payments
approximately $7.0 billion in 2020 in addition to payments for engineering and product development activities; (2) payments
associated with previously announced vehicle recalls, the settlements of the multi-district litigation and any other recall-related
associated with previously announced vehicle recalls, the settlements of the multi-district litigation and any other recall-related
contingencies; (3) payments to service debt and other long-term obligations, including discretionary and mandatory contributions
contingencies; (3) payments to service debt and other long-term obligations, including discretionary and mandatory contributions
to our pension plans; (4) dividend payments on our common stock that are declared by our Board of Directors; and (5) payments
to our pension plans; (4) dividend payments on our common stock that are declared by our Board of Directors; and (5) payments
to purchase shares of our common stock authorized by our Board of Directors.
to purchase shares of our common stock authorized by our Board of Directors.
Our liquidity plans are subject to a number of risks and uncertainties, including those described in the "Forward-Looking
Our liquidity plans are subject to a number of risks and uncertainties, including those described in the "Forward-Looking,
Statements" section of this MD&A and Item 1A. Risk Factors, some of which are outside of our control.
Statements" section of this MD&A and Item 1A. Risk Factors, some of which are outside of our control.
We continue to monitor and evaluate opportunities to strengthen our competitive position over the long term while maintaining
We continue to monitor and evaluate opportunities to strengthen our competitive position over the long term while maintaining
a strong investment-grade balance sheet. These actions may include opportunistic payments to reduce our long-term obligations,
a strong investment-grade balance sheet. These actions may include opportunistic payments to reduce our long-term obligations,
as well as the possibility of acquisitions, dispositions, investments with joint venture partners and strategic alliances that we believe
as well as the possibility of acquisitions, dispositions, investments with joint venture partners and strategic alliances that we believe
would generate significant advantages and substantially strengthen our business.
would generate significant advantages and substantially strengthen our business.
In January 2017 we announced that our Board of Directors had authorized the purchase of up to $5.0 billion of our common
In January 2017 we announced that our Board of Directors had authorized the purchase of up to $5.0 billion of our common
stock with no expiration date, as part of our common stock repurchase program. We have completed $1.6 billion of the $5.0 billion
stock with no expiration date, as part of our common stock repurchase program. We have completed $1.6 billion of the $5.0 billion
program through December 31, 2019.
program through December 31, 2019.
Cash flows occur amongst our Automotive, Cruise and GM Financial operations that are eliminated when we consolidate our
Cash flows occur amongst our Automotive, Cruise and GM Financial operations that are eliminated when we consolidate our
cash flows. Such eliminations include, among other things, collections by Automotive on wholesale accounts receivables financed
cash flows. Such eliminations include, among other things, collections by Automotive on wholesale accounts receivables fmanced
by dealers through GM Financial, payments between Automotive and GM Financial for accounts receivables transferred by
by dealers through GM Financial, payments between Automotive and GM Financial for accounts receivables transferred by
Automotive to GM Financial, dividends issued by GM Financial to Automotive and Automotive cash injections in Cruise. The
Automotive to GM Financial, dividends issued by GM Financial to Automotive and Automotive cash injections in Cruise. The
presentation of Automotive liquidity, Cruise liquidity and GM Financial liquidity presented below includes the impact of cash
presentation of Automotive liquidity, Cruise liquidity and GM Financial liquidity presented below includes the impact of cash
transactions amongst the sectors that are ultimately eliminated in consolidation.
transactions amongst the sectors that are ultimately eliminated in consolidation.
Automotive Liquidity Total available liquidity includes cash, cash equivalents, marketable debt securities and funds available
Automotive Liquidity Total available liquidity includes cash, cash equivalents, marketable debt securities and funds available
under credit facilities. The amount of available liquidity is subject to seasonal fluctuations and includes balances held by various
under credit facilities. The amount of available liquidity is subject to seasonal fluctuations and includes balances held by various
business units and subsidiaries worldwide that are needed to fund their operations.
business units and subsidiaries worldwide that are needed to fund their operations.
a
We manage our liquidity primarily at our treasury centers as well as at certain of our significant consolidated overseas subsidiaries.
We manage our liquidity primarily at our treasury centers as well as at certain of our significant consolidated overseas subsidiaries.
Approximately 90% of our cash and marketable debt securities were managed within North America and at our regional treasury
Approximately 90% of our cash and marketable debt securities were managed within North America and at our regional treasury
centers at December 31, 2019. We have used and will continue to use other methods including intercompany loans to utilize these
centers at December 31, 2019. We have used and will continue to use other methods including intercompany loans to utilize these
funds across our global operations as needed.
funds across our global operations as needed.
Our cash equivalents and marketable debt securities balances are primarily denominated in U.S. Dollars and include investments
Our cash equivalents and marketable debt securities balances are primarily denominated in U.S. Dollars and include investments
in U.S. government and agency obligations, foreign government securities, time deposits, corporate debt securities and mortgage
in U.S. government and agency obligations, foreign government securities, time deposits, corporate debt securities and mortgage
and asset-backed securities. Our investment guidelines, which we may change from time to time, prescribe certain minimum credit
and asset-backed securities. Our investment guidelines, which we may change from time to time, prescribe certain minimum credit
worthiness thresholds and limit our exposures to any particular sector, asset class, issuance or security type. The majority of our
worthiness thresholds and limit our exposures to any particular sector, asset class, issuance or security type. The majority of our
current investments in debt securities are with A/A2 or better rated issuers.
current investments in debt securities are with A/A2 or better rated issuers.
f
30
30
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
We use credit facilities as a mechanism to provide additional flexibility in managing our global liquidity. At December 31, 2018
We use credit facilities as a mechanism to provide additional flexibility in managing our global liquidity. At December 31, 2018
the total size of our credit facilities was $16.5 billion, which consisted principally of three primary revolving credit facilities. In
the total size of our credit facilities was $16.5 billion, which consisted principally of three primary revolving credit facilities. In
January 2019, we entered into a fourth facility, increasing our aggregate borrowing capacity from $16.5 billion to $19.5 billion.
January 2019, we entered into a fourth facility, increasing our aggregate borrowing capacity from $16.5 billion to $19.5 billion.
These facilities consist of a three-year, $4.0 billion facility, a five-year, $10.5 billion facility, a 364-day, $2.0 billion facility and a
These facilities consist of a three-year, $4.0 billion facility, a five-year, $10.5 billion facility, a 364-day, $2.0 billion facility and a
three-year, $3.0 billion facility. The three-year, $4.0 billion facility allows for borrowings in U.S. Dollars and other currencies and
three-year, $3.0 billion facility. The three-year, $4.0 billion facility allows for borrowings in U.S. Dollars and other currencies and
includes a letter of credit sub-facility of $1.1 billion. The five-year, $10.5 billion facility allows for borrowings in U.S. Dollars
includes a letter of credit sub-facility of $1.1 billion. The five-year, $10.5 billion facility allows for borrowings in U.S. Dollars
and other currencies. GM Financial has exclusive use of our 364-day, $2.0 billion credit facility, which allows for borrowing in
and other currencies. GM Financial has exclusive use of our 364-day, $2.0 billion credit facility, which allows for borrowing in
U.S. Dollars only and was renewed in April 2019 for an additional 364-day term. The new three-year unsecured revolving credit
U.S. Dollars only and was renewed in April 2019 for an additional 364-day term. The new three-year unsecured revolving credit
facility has an initial borrowing capacity of $3.0 billion, reducing to $2.0 billion in July 2020. The facility provides additional
facility has an initial borrowing capacity of $3.0 billion, reducing to $2.0 billion in July 2020. The facility provides additional
financial flexibility and was used in 2019 to fund transformation activities announced in November 2018 for $0.7 billion, which
fmancial flexibility and was used in 2019 to fund transformation activities announced in November 2018 for $0.7 billion, which
we repaid in full in 2019. Total automotive borrowing capacity under the credit facility was $17.5 billion and $14.5 billion at
we repaid in full in 2019. Total automotive borrowing capacity under the credit facility was $17.5 billion and $14.5 billion at
December 31, 2019 and 2018. We did not have any borrowings against our other primary facilities at December 31, 2019 and
December 31, 2019 and 2018. We did not have any borrowings against our other primary facilities at December 31, 2019 and
2018. We had letters of credit outstanding under our sub-facility of $0.2 billion and $0.3 billion at December 31, 2019 and 2018.
2018. We had letters of credit outstanding under our sub-facility of $0.2 billion and $0.3 billion at December 31, 2019 and 2018.
ff
GM Financial had access to our revolving credit facilities, except for the $3.0 billion facility executed in January 2019, but did
GM Financial had access to our revolving credit facilities, except for the $3.0 billion facility executed in January 2019, but did
not have borrowings outstanding against them at December 31, 2019. Refer to Note 13 to our consolidated financial statements
not have borrowings outstanding against them at December 31, 2019. Refer to Note 13 to our consolidated financial statements
for additional information on credit facilities. We had intercompany loans from GM Financial of $0.5 billion and $0.6 billion at
for additional information on credit facilities. We had intercompany loans from GM Financial of $0.5 billion and $0.6 billion at
December 31, 2019 and 2018, which primarily consisted of commercial loans to dealers we consolidate, and we had no intercompany
December 31,2019 and 2018, which primarily consisted of commercial loans to dealers we consolidate, and we had no intercompany
loans to GM Financial. Refer to Note 5 of our consolidated financial statements for additional information.
loans to GM Financial. Refer to Note 5 of our consolidated fmancial statements for additional information.
t
GM Financial's Board of Directors declared and paid dividends of $0.4 billion on its common stock in October 2019 and 2018.
GM Financial's Board of Directors declared and paid dividends of $0.4 billion on its common stock in October 2019 and 2018.
Future dividends from GM Financial will depend on a number of factors including business and economic conditions, its financial
Future dividends from GM Financial will depend on a number of factors including business and economic conditions, its financial
condition, earnings, liquidity requirements and leverage ratio.
condition, earnings, liquidity requirements and leverage ratio.
The following table summarizes our available liquidity (dollars in billions):
The following table summarizes our available liquidity (dollars in billions):
December 31, 2019
December 31, 2019
Automotive cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
13.4
Automotive cash and cash equivalents 13.4
Marketable debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.9
Marketable debt securities 3.9
Automotive cash, cash equivalents and marketable debt securities(a)(b). . . . . . . . . . . . . .
17.3
Automotive cash, cash equivalents and marketable debt securities(a)(b) 17.3
Cruise cash and cash equivalents(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2.3
Cruise cash and cash equivalents(c) 2.3
Cruise marketable debt securities(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.3
Cruise marketable debt securities(c) 0.3
Available liquidity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19.9
Available liquidity 19.9
Available under credit facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17.3
Available under credit facilities 17.3
Total available liquidity(a)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
37.2
Total available liquidity(a)(d) 37.2
December 31, 2018
December 31, 2018
13.7
$
13.7
$
6.0
6.0
19.6
19.6
7.3
2.3
—
21.9
21.9
14.2
14.2
36.1
36.1
$
$
__________
(a) Amounts may not sum due to rounding.
(a) Amounts may not sum due to rounding.
(b) Includes $0.2 billion and $0.6 billion that is designated exclusively to fund capital expenditures in GM Korea Company (GM Korea) at
(b) Includes $0.2 billion and $0.6 billion that is designated exclusively to fund capital expenditures in GM Korea Company (GM Korea) at
December 31, 2019 and 2018. Refer to Note 20 to our consolidated financial statements for further details.
December 31, 2019 and 2018. Refer to Note 20 to our consolidated financial statements for further details.
(c) Amounts are designated exclusively for the use of Cruise. Refer to Note 20 to our consolidated financial statements for further details.
(c) Amounts are designated exclusively for the use of Cruise. Refer to Note 20 to our consolidated financial statements for further details.
(d) Excludes our remaining investment in Lyft, which had a fair value of $0.5 billion at December 31, 2019.
(d) Excludes our remaining investment in Lyft, which had a fair value of $0.5 billion at December 31, 2019.
In the year ended December 31, 2019, we estimate that lost production volumes and parts sales due to the UAW strike had an
In the year ended December 31, 2019, we estimate that lost production volumes and parts sales due to the UAW strike had an
unfavorable pre-tax impact to Net cash provided by operating activities of approximately $5.4 billion, which materially impacted
unfavorable pre-tax impact to Net cash provided by operating activities of approximately $5.4 billion, which materially impacted
our available liquidity at December 31, 2019.
our available liquidity at December 31, 2019.
31
31
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table summarizes the changes in our Automotive available liquidity (excluding Cruise, dollars in billions):
The following table summarizes the changes in our Automotive available liquidity (excluding Cruise, dollars in billions):
Year Ended
Year Ended
December 31, 2019
December 31, 2019
Operating cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
7.4
Operating cash flow 7.4
(7.5)
Capital expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital expenditures (7.5)
(2.2)
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid (2.2)
(0.7)
GM investment in Cruise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GM investment in Cruise (0.7)
Other non-operating(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.7
Other non-operating(a) 0.7
Increase in available credit facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.1
Increase in available credit facilities 3.1
Total change in automotive available liquidity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
0.8
Total change in automotive available liquidity 0.8
__________
(a) Amount includes $0.3 billion of proceeds from the sale of a portion of our Lyft shares.
(a) Amount includes $0.3 billion of proceeds from the sale of a portion of our Lyft shares.
Automotive Cash Flow (Dollars in billions)
Automotive Cash Flow (Dollars in billions)
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
2019 vs. 2018
2019 vs. 2018
Change
Change
Operating Activities
Operating Activities
$
Income (loss) from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . $
7.1
5.8
$ 7.1
Income (loss) from continuing operations $ 5.8
6.1
6.7
Depreciation, amortization and impairment charges . . . . . . . . . . . . . . . .
6.1
Depreciation, amortization and impairment charges 6.7
(3.4)
(1.5)
Pension and OPEB activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3.4)
Pension and OPEB activities (1.5)
(2.2)
Working capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.7
0.7
Working capital (2.2)
(1.5)
1.9
Accrued and other liabilities and income taxes . . . . . . . . . . . . . . . . . . . .
Accrued and other liabilities and income taxes (1.5)
1.9
(0.7)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.1
(0.7)
Other 0.1
Net automotive cash provided by operating activities . . . . . . . . . . . . . . . $
11.7
7.4
Net automotive cash provided by operating activities $ 7.4 $ 11.7
$
(1.3)
$
$ (0.2) $ (1.3)
0.6
0.6
1.9
1.9
(2.9)
(2.9)
(3.4)
(3.4)
0.8
0.8
(4.3)
$
$ (4.3)
(0.2) $
5.7
5.7
(2.6)
(2.6)
1.8
1.8
8.5
8.5
1.2
1.2
$
14.4
S 14.4
In the year ended December 31, 2019, the decrease in Net automotive cash provided by operating activities was primarily due
In the year ended December 31, 2019, the decrease in Net automotive cash provided by operating activities was primarily due
to the unfavorable pre-tax impact of lost production volumes and parts sales due to the UAW strike of approximately $5.4 billion,
to the unfavorable pre-tax impact of lost production volumes and parts sales due to the UAW strike of approximately $5.4 billion,
partially offset by favorable pension contributions of $1.1 billion primarily made to our U.K., Canada and Korea pension plans in
partially offset by favorable pension contributions of $1.1 billion primarily made to our U.K., Canada and Korea pension plans in
2018.
2018.
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
2019 vs. 2018
2019 vs. 2018
Change
Change
Investing Activities
Investing Activities
(7.5) $
1.2
Capital expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Capital expenditures $ (7.5) $ (8.7) $ (8.3) $ 1.2
0.1
2.4
Acquisitions and liquidations of marketable securities, net(a) . . . . . . . . .
0.1
2.4
Acquisitions and liquidations of marketable securities, net(a)
(0.7)
0.4
GM investment in Cruise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.4
GM investment in Cruise (0.7)
0.4
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.2
0.4
Other 0.2
(5.6) $
Net automotive cash used in investing activities . . . . . . . . . . . . . . . . . . . . $
2.1
Net automotive cash used in investing activities $ (5.6) $ (7.7) $ (5.2) S 2.1
(8.3) $
3.5
3.5
—
(0.4)
(0.4)
(5.2) $
(8.7) $
2.3
2.3
(1.1)
(1.1)
(0.2)
(0.2)
(7.7) $
__________
(a) Amount includes $0.3 billion of proceeds from the sale of a portion of our Lyft shares in the year ended December 31, 2019.
(a) Amount includes $0.3 billion of proceeds from the sale of a portion of our Lyft shares in the year ended December 31, 2019.
32
32
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
2019 vs. 2018
2019 vs. 2018
Change
Change
Financing Activities
Financing Activities
(2.1)
$
Issuance of senior unsecured notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2.1
$ (2.1)
$ 2.1
Issuance of senior unsecured notes $
(1.4)
1.9
0.5
Net proceeds (payments) on short-term debt . . . . . . . . . . . . . . . . . . . . . .
1.9
(1.4)
Net proceeds (payments) on short-term debt 0.5
(0.1)
0.1
Payments to purchase common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
0.1
Payments to purchase common stock (0.1)
(2.2)
(2.2)
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
(2.2)
Dividends paid (2.2)
(0.7)
Proceeds from KDB investment in GM Korea. . . . . . . . . . . . . . . . . . . . .
0.7
—
(0.7)
Proceeds from KDB investment in GM Korea 0.7
(0.6)
(0.4)
0.2
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.2
(0.6)
Other (0.4)
(0.6)
(1.5) $
(2.1) $
Net automotive cash used in financing activities . . . . . . . . . . . . . . . . . . . $
Net automotive cash used in financing activities $ (2.1) $ (1.5) $ (4.2) $ (0.6)
$
3.0
$ 3.0
(0.1)
(0.1)
(4.5)
(4.5)
(2.2)
(2.2)
—
(0.4)
(0.4)
(4.2) $
— $
Adjusted Automotive Free Cash Flow We measure adjusted automotive free cash flow as automotive operating cash flow from
Adjusted Automotive Free Cash Flow We measure adjusted automotive free cash flow as automotive operating cash flow from
continuing operations less capital expenditures adjusted for management actions. For the year ended December 31, 2019, net
continuing operations less capital expenditures adjusted for management actions. For the year ended December 31, 2019, net
automotive cash provided by operating activities under U.S. GAAP was $7.4 billion, capital expenditures were $7.5 billion and
automotive cash provided by operating activities under U.S. GAAP was $7.4 billion, capital expenditures were $7.5 billion and
adjustments for management actions, primarily related to transformation activities, were $1.2 billion. For the year ended December m
adjustments for management actions, primarily related to transformation activities, were $1.2 billion. For the year ended December
31, 2018, net automotive cash provided by operating activities under U.S. GAAP was $11.7 billion, capital expenditures were $8.7
31,2018, net automotive cash provided by operating activities under U.S. GAAP was $11.7 billion, capital expenditures were $8.7
billion and an adjustment for management actions related to restructuring in Korea was $0.8 billion.
billion and an adjustment for management actions related to restructuring in Korea was $0.8 billion.
Status of Credit Ratings We receive ratings from four independent credit rating agencies: DBRS Limited, Fitch Ratings (Fitch),
Status of Credit Ratings We receive ratings from four independent credit rating agencies: DBRS Limited, Fitch Ratings (Fitch),
Moody's Investor Service (Moody's) and Standard & Poor's (S&P). All four credit rating agencies currently rate our corporate
Moody's Investor Service (Moody's) and Standard & Poor's (S&P). All four credit rating agencies currently rate our corporate
credit at investment grade. The following table summarizes our credit ratings at January 24, 2020:
credit at investment grade. The following table summarizes our credit ratings at January 24, 2020:
Corporate
Corporate
DBRS Limited. . . . . . . . . . . . . . . . . . . . . . . . .
BBB (high)
DBRS Limited BBB (high)
Fitch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
BBB
Fitch BBB
Moody's. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Investment Grade
Moody's Investment Grade
BBB
S&P . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
S&P BBB
Revolving Credit
Revolving Credit
Facilities
Outlook
Senior Unsecured
Facilities Senior Unsecured Outlook
Stable
N/A
BBB (high)
BBB (high)
Stable
N/A
Stable
BBB
BBB
BBB
Stable
BBB
Baa3
Stable
Baa3
Baa2
Baa2
Stable
Stable
BBB
BBB
BBB
BBB
Stable
In April 2019 DBRS Limited upgraded our corporate rating and revolving credit facilities rating to BBB (high) from BBB and
In April 2019 DBRS Limited upgraded our corporate rating and revolving credit facilities rating to BBB (high) from BBB and
revised their outlook to Stable from Positive. All other credit ratings remained unchanged from January 1, 2019 through January 24,
revised their outlook to Stable from Positive. All other credit ratings remained unchanged from January 1,2019 through January 24,
2020.
2020.
y
Cruise Liquidity
Cruise Liquidity
The following table summarizes the changes in our Cruise available liquidity (dollars in billions):
The following table summarizes the changes in our Cruise available liquidity (dollars in billions):
(0.8)
Operating cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Operating cash flow (0.8)
Issuance of Cruise Preferred Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.5
Issuance of Cruise Preferred Shares 0.5
GM investment in Cruise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.7
GM investment in Cruise 0.7
(0.1)
Other non-operating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-operating (0.1)
Total change in Cruise available liquidity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
0.3
Total change in Cruise available liquidity 0.3
When Cruise's autonomous vehicles are ready for commercial deployment, Softbank Vision Fund (AIV M2), L.P. (The Vision
When Cruise's autonomous vehicles are ready for commercial deployment, Softbank Vision Fund (MV M2), L.P. (The Vision
Fund) is obligated to purchase additional Cruise Preferred Shares for $1.35 billion.
Fund) is obligated to purchase additional Cruise Preferred Shares for $1.35 billion.
Year Ended
Year Ended
December 31, 2019
December 31, 2019
33
33
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Cruise Cash Flow (Dollars in billions)
Cruise Cash Flow (Dollars in billions)
(0.5) $
(0.6) $
(0.8) $
(0.2)
Net cash used in operating activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net cash used in operating activities $ (0.8) $ (0.6) $ (0.5) $ (0.2)
(0.2)
(0.1) $
(0.1) $
(0.3) $
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net cash used in investing activities $ (0.3) $ (0.1) $ (0.1) $ (0.2)
(1.9)
$
$
$
Net cash provided by financing activities . . . . . . . . . . . . . . . . . . . . . . . . . $
0.6
3.0
1.1
$ (1.9)
$ 0.6
$ 3.0
Net cash provided by fmancing activities $ 1.1
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
2019 vs. 2018
2019 vs. 2018
Change
Change
In the year ended December 31, 2019 Net cash provided by financing activities decreased primarily due to a reduction in the
In the year ended December 31, 2019 Net cash provided by fmancing activities decreased primarily due to a reduction in the
issuance of preferred and common shares.
issuance of preferred and common shares.
Automotive Financing – GM Financial Liquidity GM Financial's primary sources of cash are finance charge income, leasing
Automotive Financing - GM Financial Liquidity GM Financial's primary sources of cash are fmance charge income, leasing
income and proceeds from the sale of terminated leased vehicles, net distributions from credit facilities, securitizations, secured
income and proceeds from the sale of terminated leased vehicles, net distributions from credit facilities, securitizations, secured
and unsecured borrowings and collections and recoveries on finance receivables. GM Financial's primary uses of cash are purchases
and unsecured borrowings and collections and recoveries on fmance receivables. GM Financial's primary uses of cash are purchases
of retail finance receivables and leased vehicles, the funding of commercial finance receivables, repayment of secured and unsecured
ofretail finance receivables and leased vehicles, the funding of commercial fmance receivables, repayment of secured and unsecured
debt, funding credit enhancement requirements in connection with securitizations and secured credit facilities, interest costs, and
debt, funding credit enhancement requirements in connection with securitizations and secured credit facilities, interest costs, and
operating expenses. In 2018 GM Financial issued $0.5 billion of Fixed-to-Floating Rate Cumulative Perpetual Preferred Stock,
operating expenses. In 2018 GM Financial issued $0.5 billion of Fixed-to-Floating Rate Cumulative Perpetual Preferred Stock,
Series B, $0.01 par value, with a liquidation preference of $1,000 per share. The following table summarizes GM Financial's
Series B, $0.01 par value, with a liquidation preference of $1,000 per share. The following table summarizes GM Financial's
available liquidity (dollars in billions):
available liquidity (dollars in billions):
December 31, 2019
December 31, 2019
3.3
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash and cash equivalents 3.3
Borrowing capacity on unpledged eligible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17.5
Borrowing capacity on unpledged eligible assets 17.5
0.3
Borrowing capacity on committed unsecured lines of credit . . . . . . . . . . . . . . . . . . . . . . .
Borrowing capacity on committed unsecured lines of credit 0.3
2.0
Borrowing capacity on revolving credit facility, exclusive to GM Financial. . . . . . . . . . .
2.0
Borrowing capacity on revolving credit facility, exclusive to GM Financial
23.1
Total GM Financial available liquidity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
23.1
Total GM Financial available liquidity S
December 31, 2018
December 31, 2018
4.9
$
$
4.9
18.0
18.0
0.3
0.3
2.0
2.0
25.2
25.2
$
$
In the year ended December 31, 2019, available liquidity decreased primarily due to a decrease in cash and cash equivalents
In the year ended December 31, 2019, available liquidity decreased primarily due to a decrease in cash and cash equivalents
and increased credit facility utilization, resulting from a decrease in issuances of securitizations and unsecured debt. At December 31,
and increased credit facility utilization, resulting from a decrease in issuances of securitizations and unsecured debt. At December 31,
2019, available liquidity was in line with our liquidity targets.
2019, available liquidity was in line with our liquidity targets.
GM Financial has access to $16.5 billion of our revolving credit facilities with exclusive access to the 364-day, $2.0 billion
GM Financial has access to $16.5 billion of our revolving credit facilities with exclusive access to the 364-day, $2.0 billion
facility. Refer to the Automotive Liquidity section of this MD&A for additional details. We have a support agreement with GM
facility. Refer to the Automotive Liquidity section of this MD&A for additional details. We have a support agreement with GM
Financial which, among other things, establishes commitments of funding from us to GM Financial. This agreement also provides
Financial which, among other things, establishes commitments of funding from us to GM Financial. This agreement also provides
that we will continue to own all of GM Financial’s outstanding voting shares so long as any unsecured debt securities remain
that we will continue to own all of GM Financial's outstanding voting shares so long as any unsecured debt securities remain
outstanding at GM Financial. In addition we are required to use our commercially reasonable efforts to ensure GM Financial
outstanding at GM Financial. In addition we are required to use our commercially reasonable efforts to ensure GM Financial
remains a subsidiary borrower under our corporate revolving credit facilities.
remains a subsidiary borrower under our corporate revolving credit facilities.
Credit Facilities In the normal course of business, in addition to using its available cash, GM Financial utilizes borrowings
Credit Facilities In the normal course of business, in addition to using its available cash, GM Financial utilizes borrowings
under its credit facilities, which may be secured or unsecured, and GM Financial repays these borrowings as appropriate under its
under its credit facilities, which may be secured or unsecured, and GM Financial repays these borrowings as appropriate under its
cash management strategy. At December 31, 2019 secured, committed unsecured and uncommitted unsecured credit facilities
cash management strategy. At December 31, 2019 secured, committed unsecured and uncommitted unsecured credit facilities
totaled $26.7 billion, $0.4 billion and $1.8 billion with advances outstanding of $6.2 billion, an insignificant amount and $1.8
totaled $26.7 billion, $0.4 billion and $1.8 billion with advances outstanding of $6.2 billion, an insignificant amount and $1.8
billion.
billion.
GM Financial Cash Flow (Dollars in billions)
GM Financial Cash Flow (Dollars in billions)
$
$
Net cash provided by operating activities. . . . . . . . . . . . . . . . . . . . . . . . . $
7.4
$
6.5
8.1
0.7
$ 0.7
$ 7.4 $ 6.5
Net cash provided by operating activities $ 8.1
(17.5) $
(21.9) $
(5.0) $
12.5
Net cash used in investing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net cash used in investing activities $ (5.0) $ (17.5) $ (21.9) $ 12.5
(14.6)
(3.5) $
$
$
Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . $
16.1
11.1
$ (14.6)
$ 16.1
Net cash provided by (used in) financing activities $ (3.5) $ 11.1
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
2019 vs. 2018
/019 vs. 2018
Change
Change
In the year ended December 31, 2019, Net cash provided by operating activities increased primarily due to a decrease in net
In the year ended December 31, 2019, Net cash provided by operating activities increased primarily due to a decrease in net
collateral posted for derivative positions of $0.8 billion as a result of favorable changes in interest rates on GM Financial’s
collateral posted for derivative positions of $0.8 billion as a result of favorable changes in interest rates on GM Financial's
collateralized derivative portfolio.
collateralized derivative portfolio.
34
34
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
In the year ended December 31, 2019, Net cash used in investing activities decreased primarily due to: (1) increased collections
In the year ended December 31, 2019, Net cash used in investing activities decreased primarily due to: (1) increased collections
and recoveries on finance receivables of $6.2 billion; (2) decreased purchases of finance receivables of $3.6 billion; (3) increased
and recoveries on fmance receivables of $6.2 billion; (2) decreased purchases of fmance receivables of $3.6 billion; (3) increased
proceeds from the termination of leased vehicles of $2.4 billion; and (4) decreased purchases of leased vehicles of $0.3 billion.
proceeds from the termination of leased vehicles of $2.4 billion; and (4) decreased purchases of leased vehicles of $0.3 billion.
In the year ended December 31, 2019, Net cash used in financing activities increased primarily due to an increase in debt
In the year ended December 31, 2019, Net cash used in fmancing activities increased primarily due to an increase in debt
repayments of $9.2 billion, a decrease in borrowings of $4.8 billion and a decrease in proceeds from issuance of preferred stock
repayments of $9.2 billion, a decrease in borrowings of $4.8 billion and a decrease in proceeds from issuance of preferred stock
of $0.5 billion.
of $0.5 billion.
Off-Balance Sheet Arrangements We do not currently utilize off-balance sheet securitization arrangements. All trade or finance
Off-Balance Sheet Arrangements We do not currently utilize off-balance sheet securitization arrangements. All trade or fmance
receivables and related obligations subject to securitization programs are recorded on our consolidated balance sheets at
receivables and related obligations subject to securitization programs are recorded on our consolidated balance sheets at
December 31, 2019 and 2018.
December 31, 2019 and 2018.
Contractual Obligations and Other Long-Term Liabilities We have minimum commitments under contractual obligations,
Contractual Obligations and Other Long-Term Liabilities We have minimum commitments under contractual obligations,
including purchase obligations. A purchase obligation is defined as an agreement to purchase goods or services that is enforceable
including purchase obligations. A purchase obligation is defmed as an agreement to purchase goods or services that is enforceable
and legally binding on us and that specifies all significant terms, including fixed or minimum quantities to be purchased or fixed
and legally binding on us and that specifies all significant terms, including fixed or minimum quantities to be purchased or fixed
minimum price provisions and the approximate timing of the transaction. Based on these definitions, the following table includes
minimum price provisions and the approximate timing of the transaction. Based on these defmitions, the following table includes
only those contracts that include fixed or minimum obligations. The majority of our purchases are not included in the table as they
only those contracts that include fixed or minimum obligations. The majority of our purchases are not included in the table as they
are made under purchase orders that are requirements-based and accordingly do not specify minimum quantities. The following
are made under purchase orders that are requirements-based and accordingly do not specify minimum quantities. The following
table summarizes aggregated information about our outstanding contractual obligations and other long-term liabilities at
table summarizes aggregated information about our outstanding contractual obligations and other long-term liabilities at
December 31, 2019:
December 31, 2019:
a
Payments Due by Period
Payments Due by Period
2020
2020
Automotive debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,803
Automotive debt $ 1,803
Automotive Financing debt. . . . . . . . . . . . . . . . . . . . . . .
35,587
Automotive Financing debt 35,587
Finance lease obligations . . . . . . . . . . . . . . . . . . . . . . . .
109
Finance lease obligations 109
Automotive interest payments(a) . . . . . . . . . . . . . . . . . .
774
Automotive interest payments(a) 774
Automotive Financing interest payments(b). . . . . . . . . .
2,485
Automotive Financing interest payments(b) 2,485
Postretirement benefits(c) . . . . . . . . . . . . . . . . . . . . . . . .
252
Postretirement benefits(c) 252
Operating lease obligations . . . . . . . . . . . . . . . . . . . . . . .
272
Operating lease obligations 272
Other contractual commitments: . . . . . . . . . . . . . . . . . . .
Other contractual commitments:
Material . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,751
Material 1,751
664
Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketing 664
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
956
Other 956
Total contractual commitments(d) . . . . . . . . . . . . . . . . . $
44,653
Total contractual commitments(d) $ 44,653
2021-2022
2021-2022
$
519
$ 519
32,453
32,453
80
80
1,375
1,375
2,555
2,555
464
464
433
433
2023-2024
2023-2024
1,570
2025 and after
2025 and after
$
10,659
$
$ 1,570 $ 10,659
8,160
8,160
102
102
9,065
9,065
477
477
—
12,833
12,833
19
19
1,258
1,258
1,138
1,138
231
231
303
303
468
468
Total
Total
$
14,551
$ 14,551
89,033
89,033
310
310
12,472
12,472
6,655
6,655
947
947
1,476
1,476
497
497
209
209
1,325
1,325
$
39,910
$ 39,910
100
100
15
15
654
654
$
18,121
$ 18,121
21
21
3
3
239
239
$
29,194
$ 29,194
2,369
2.369
891
891
3,174
3,174
$ 131,878
$ 131,878
295
Non-contractual benefits(e). . . . . . . . . . . . . . . . . . . . . . . $
Non-contractual benefits(e) $ 295
__________
(a) Amounts include automotive interest payments based on contractual terms and current interest rates on our debt and finance lease obligations.
(a) Amounts include automotive interest payments based on contractual terms and current interest rates on our debt and fmance lease obligations.
Automotive interest payments based on variable interest rates were determined using the interest rate in effect at December 31, 2019.
Automotive interest payments based on variable interest rates were determined using the interest rate in effect at December 31, 2019.
(b) GM Financial interest payments were determined using the interest rate in effect at December 31, 2019 for floating rate debt and the
(b) GM Financial interest payments were determined using the interest rate in effect at December 31, 2019 for floating rate debt and the
contractual rates for fixed rate debt. GM Financial interest payments on floating rate tranches of the securitization notes payable were
contractual rates for fixed rate debt. GM Financial interest payments on floating rate tranches of the securitization notes payable were
converted to a fixed rate based on the floating rate plus any expected hedge payments.
converted to a fixed rate based on the floating rate plus any expected hedge payments.
$
9,945
$ 9,945
$
529
$ 529
$
11,477
$ 11,477
$
708
$ 708
(c) Amounts include OPEB payments under the current U.S. contractual labor agreements through 2023 and Canada labor agreements through
(c) Amounts include OPEB payments under the current U.S. contractual labor agreements through 2023 and Canada labor agreements through
2021. These agreements are generally renegotiated in the year of expiration. Amounts do not include pension funding obligations, which
2021. These agreements are generally renegotiated in the year of expiration. Amounts do not include pension funding obligations, which
are discussed in Note 15 to our consolidated financial statements.
are discussed in Note 15 to our consolidated financial statements.
(d) Amounts do not include future cash payments for purchase obligations and certain other accrued expenditures (unless specifically listed in
(d) Amounts do not include future cash payments for purchase obligations and certain other accrued expenditures (unless specifically listed in
the table above), which were recorded in Accounts payable, Accrued liabilities and Other liabilities at December 31, 2019.
the table above), which were recorded in Accounts payable, Accrued liabilities and Other liabilities at December 31, 2019.
(e) Amounts include all expected future payments for both current and expected future service at December 31, 2019 for OPEB obligations
(e) Amounts include all expected future payments for both current and expected future service at December 31, 2019 for OPEB obligations
for salaried and hourly employees extending beyond the current North American union contract agreements, workers' compensation and
for salaried and hourly employees extending beyond the current North American union contract agreements, workers' compensation and
extended disability benefits. Amounts do not include pension funding obligations, which are discussed in Note 15 to our consolidated
extended disability benefits. Amounts do not include pension funding obligations, which are discussed in Note 15 to our consolidated
financial statements.
financial statements.
The table above does not reflect product warranty and related liabilities, certified pre-owned, extended warranty and free
The table above does not reflect product warranty and related liabilities, certified pre-owned, extended warranty and free
maintenance of $8.6 billion and unrecognized tax benefits of $0.8 billion due to the uncertainty regarding the future cash outflows
maintenance of $8.6 billion and unrecognized tax benefits of $0.8 billion due to the uncertainty regarding the future cash outflows
potentially associated with these amounts. In addition, future cash outflows related to transformation activities announced in
potentially associated with these amounts. In addition, future cash outflows related to transformation activities announced in
ff
35
35
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
November 2018 are not included in the table above. Refer to Note 18 of our consolidated financial statements for additional
November 2018 are not included in the table above. Refer to Note 18 of our consolidated financial statements for additional
information.
information.
Critical Accounting Estimates The consolidated financial statements are prepared in conformity with U.S. GAAP, which requires
Critical Accounting Estimates The consolidated financial statements are prepared in conformity with U.S. GAAP, which requires
the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent
the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses in the periods
assets and liabilities at the date of the fmancial statements and the reported amounts of revenues and expenses in the periods
presented. We believe the accounting estimates employed are appropriate and the resulting balances are reasonable; however, due
presented. We believe the accounting estimates employed are appropriate and the resulting balances are reasonable; however, due
to the inherent uncertainties in developing estimates, actual results could differ from the original estimates, requiring adjustments
to the inherent uncertainties in developing estimates, actual results could differ from the original estimates, requiring adjustments
to these balances in future periods. Refer to Note 2 to our consolidated financial statements for our significant accounting policies
to these balances in future periods. Refer to Note 2 to our consolidated financial statements for our significant accounting policies
related to our critical accounting estimates.
related to our critical accounting estimates.
Product Warranty and Recall Campaigns The estimates related to product warranties are established using historical information
Product Warranty and Recall Campaigns The estimates related to product warranties are established using historical information
on the nature, frequency and average cost of claims of each vehicle line or each model year of the vehicle line and assumptions
on the nature, frequency and average cost of claims of each vehicle line or each model year of the vehicle line and assumptions
about future activity and events. When little or no claims experience exists for a model year or a vehicle line, the estimate is based
about future activity and events. When little or no claims experience exists for a model year or a vehicle line, the estimate is based
on comparable models.
on comparable models.
We accrue the costs related to product warranty at the time of vehicle sale and we accrue the estimated cost of recall campaigns
We accrue the costs related to product warranty at the time of vehicle sale and we accrue the estimated cost of recall campaigns
when they are probable and estimable, which is generally at the time of sale.
when they are probable and estimable, which is generally at the time of sale.
The estimates related to recall campaigns accrued at the time of vehicle sale are established by applying a paid loss approach
The estimates related to recall campaigns accrued at the time of vehicle sale are established by applying a paid loss approach
that considers the number of historical recall campaigns and the estimated cost for each recall campaign. These estimates consider
that considers the number of historical recall campaigns and the estimated cost for each recall campaign. These estimates consider
the nature, frequency and magnitude of historical recall campaigns, and use key assumptions including the number of historical
the nature, frequency and magnitude of historical recall campaigns, and use key assumptions including the number of historical
periods and the weighting of historical data in the reserve studies. Costs associated with recall campaigns not accrued at the time
periods and the weighting of historical data in the reserve studies. Costs associated with recall campaigns not accrued at the time
of vehicle sale are estimated based on the estimated cost of repairs and the estimated vehicles to be repaired. Depending on part a
of vehicle sale are estimated based on the estimated cost of repairs and the estimated vehicles to be repaired. Depending on part
availability and time to complete repairs we may, from time to time, offer courtesy transportation at no cost to our customers.
availability and time to complete repairs we may, from time to time, offer courtesy transportation at no cost to our customers.
These estimates are re-evaluated on an ongoing basis and based on the best available information. Revisions are made when
These estimates are re-evaluated on an ongoing basis and based on the best available information. Revisions are made when
necessary based on changes in these factors.
necessary based on changes in these factors.
The estimated amount accrued for recall campaigns at the time of vehicle sale is most sensitive to the estimated number of recall
The estimated amount accrued for recall campaigns at the time of vehicle sale is most sensitive to the estimated number of recall
events, the number of vehicles per recall event, the assumed number of vehicles that will be brought in by customers for repair
events, the number of vehicles per recall event, the assumed number of vehicles that will be brought in by customers for repair
(take rate), and the cost per vehicle for each recall event. The estimated cost of a recall campaign that is accrued on an individual
(take rate), and the cost per vehicle for each recall event. The estimated cost of a recall campaign that is accrued on an individual
basis is most sensitive to our estimated assumed take rate that is primarily developed based on our historical take rate experience.
basis is most sensitive to our estimated assumed take rate that is primarily developed based on our historical take rate experience.
A 10% increase in the estimated take rate for all recall campaigns would increase the estimated cost by approximately $0.3 billion.
A 10% increase in the estimated take rate for all recall campaigns would increase the estimated cost by approximately $0.3 billion.
Actual experience could differ from the amounts estimated requiring adjustments to these liabilities in future periods. Due to
Actual experience could differ from the amounts estimated requiring adjustments to these liabilities in future periods. Due to
the uncertainty and potential volatility of the factors contributing to developing estimates, changes in our assumptions could
the uncertainty and potential volatility of the factors contributing to developing estimates, changes in our assumptions could
materially affect our results of operations.
materially affect our results of operations.
Sales Incentives The estimated effect of sales incentives offered to dealers and end customers is recorded as a reduction of
Sales Incentives The estimated effect of sales incentives offered to dealers and end customers is recorded as a reduction of
Automotive net sales and revenue at the time of sale. There may be numerous types of incentives available at any particular time.
Automotive net sales and revenue at the time of sale. There may be numerous types of incentives available at any particular time.
Incentive programs are generally specific to brand, model or sales region and are for specified time periods, which may be extended.
Incentive programs are generally specific to brand, model or sales region and are for specified time periods, which may be extended.
Significant factors used in estimating the cost of incentives include forecasted sales volume, product mix, and the rate of customer
Significant factors used in estimating the cost of incentives include forecasted sales volume, product mix, and the rate of customer
acceptance of incentive programs, all of which are estimated based on historical experience and assumptions concerning future
acceptance of incentive programs, all of which are estimated based on historical experience and assumptions concerning future
customer behavior and market conditions. A change in any of these factors affecting the estimate could have a significant effect
customer behavior and market conditions. A change in any of these factors affecting the estimate could have a significant effect
on recorded sales incentives. Subsequent adjustments to incentive estimates are possible as facts and circumstances change over
on recorded sales incentives. Subsequent adjustments to incentive estimates are possible as facts and circumstances change over
time, which could affect the revenue previously recognized in Automotive net sales and revenue.
time, which could affect the revenue previously recognized in Automotive net sales and revenue.
Valuation of GM Financial Equipment on Operating Leases Assets and Residuals GM Financial has investments in leased
Valuation of GM Financial Equipment on Operating Leases Assets and Residuals GM Financial has investments in leased
vehicles recorded as operating leases, which relate to vehicle leases to retail customers with lease terms that typically range from
vehicles recorded as operating leases, which relate to vehicle leases to retail customers with lease terms that typically range from
two to five years. At the beginning of the lease an estimate is made of the expected residual value at the end of the lease term. The
two to five years. At the beginning of the lease an estimate is made of the expected residual value at the end of the lease term. The
expected residual value is based on third-party data that considers various data points and assumptions, including, but not limited
expected residual value is based on third-party data that considers various data points and assumptions, including, but not limited
to, recent auction values, the expected future volume of returning leased vehicles, used vehicle prices, manufacturer incentive
to, recent auction values, the expected future volume of returning leased vehicles, used vehicle prices, manufacturer incentive
programs and fuel prices. Realization of the residual values is dependent on the future ability to market the vehicles under prevailing
programs and fuel prices. Realization of the residual values is dependent on the future ability to market the vehicles under prevailing
market conditions. The customer is obligated to make payments during the term of the lease for the difference between the purchase
market conditions. The customer is obligated to make payments during the term of the lease for the difference between the purchase
price and the contract residual value plus a money factor. Since the customer is not obligated to purchase the vehicle at the end of
price and the contract residual value plus a money factor. Since the customer is not obligated to purchase the vehicle at the end of
the contract, we are exposed to a risk of loss to the extent the customer returns the vehicle prior to or at the end of the lease term
the contract, we are exposed to a risk of loss to the extent the customer returns the vehicle prior to or at the end of the lease term
and the value of the vehicle is below the expected residual value estimated at the inception of the lease.
and the value of the vehicle is below the expected residual value estimated at the inception of the lease.
rr
36
36
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
The following table summarizes vehicles included in GM Financial equipment on operating leases, net (vehicles in thousands):
The following, table summarizes vehicles included in GM Financial equipment on operating leases, net (vehicles in thousands):
December 31, 2019
December 31, 2019
Crossovers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
972
Crossovers 972
Trucks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
288
Trucks 288
SUVs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108
SUVs 108
Cars. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
238
Cars 238
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,606
Total 1.606
December 31, 2018
December 31, 2018
917
917
296
296
111
111
379
379
1,703
1,703
At December 31, 2019, the estimated residual value of our leased assets at the end of the lease term was $30.4 billion. We
At December 31, 2019, the estimated residual value of our leased assets at the end of the lease term was $30.4 billion. We
periodically review the adequacy of the depreciation rates. If we believe that the expected residual values of the leased assets have
periodically review the adequacy of the depreciation rates. If we believe that the expected residual values of the leased assets have
changed, we revise the depreciation rate to ensure the net investment in the operating leases reflects the revised estimate of expected
changed, we revise the depreciation rate to ensure the net investment in the operating leases reflects the revised estimate of expected
residual value at the end of the lease term. Such adjustments to the depreciation rate would result in a change in depreciation
residual value at the end of the lease term. Such adjustments to the depreciation rate would result in a change in depreciation
expense on leased assets which is recorded prospectively on a straight-line basis. The following table illustrates the effect of a 1%
expense on leased assets which is recorded prospectively on a straight-line basis. The following table illustrates the effect of a 1%
change in the estimated residual values at December 31, 2019, which would increase or decrease depreciation expense over the
change in the estimated residual values at December 31, 2019, which would increase or decrease depreciation expense over the
remaining term of our operating lease portfolio, holding all other assumptions constant (dollars in millions):
remaining term of our operating lease portfolio, holding all other assumptions constant (dollars in millions):
Impact to
Impact to
Depreciation Expense
Depreciation Expense
Crossovers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
159
Crossovers 159
Trucks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
73
Trucks 73
SUVs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39
SUVs 39
Cars. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
33
Cars 33
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
304
Total 304
We also evaluate the carrying value of the operating leases aggregated by vehicle make, year and model into leased asset groups,
We also evaluate the carrying value of the operating leases aggregated by vehicle make, year and model into leased asset groups,
check for indicators of impairment and test for impairment to the extent necessary in accordance with applicable accounting
check for indicators of impairment and test for impairment to the extent necessary in accordance with applicable accounting
standards. We believe no impairment indicators existed during 2019, 2018 or 2017.
standards. We believe no impairment indicators existed during 2019, 2018 or 2017.
Pension and OPEB Plans Our defined benefit pension plans are accounted for on an actuarial basis, which requires the selection
Pension and OPEB Plans Our defmed benefit pension plans are accounted for on an actuarial basis, which requires the selection
of various assumptions, including an expected long-term rate of return on plan assets, a discount rate, mortality rates of participants
of various assumptions, including an expected long-term rate of return on plan assets, a discount rate, mortality rates of participants
and expectation of mortality improvement. Our pension obligations include Korean statutory pension payments that are valued
and expectation of mortality improvement. Our pension obligations include Korean statutory pension payments that are valued
on a walk away basis. The expected long-term rate of return on U.S. plan assets that is utilized in determining pension expense is
on a walk away basis. The expected long-term rate of return on U.S. plan assets that is utilized in determining pension expense is
derived from periodic studies, which include a review of asset allocation strategies, anticipated future long-term performance of
derived from periodic studies, which include a review of asset allocation strategies, anticipated future long-term performance of
individual asset classes, risks using standard deviations and correlations of returns among the asset classes that comprise the plans'
individual asset classes, risks using standard deviations and correlations of returns among the asset classes that comprise the plans'
asset mix. While the studies give appropriate consideration to recent plan performance and historical returns, the assumptions are
asset mix. While the studies give appropriate consideration to recent plan performance and historical returns, the assumptions are
primarily long-term, prospective rates of return.
primarily long-term, prospective rates of return.
In December 2019 an investment policy study was completed for the U.S. pension plans. As a result of changes to our capital
In December 2019 an investment policy study was completed for the U.S. pension plans. As a result of changes to our capital
market assumptions the weighted-average long-term rate of return on assets decreased from 6.4% at December 31, 2018 to 5.9%
market assumptions the weighted-average long-term rate of return on assets decreased from 6.4% at December 31, 2018 to 5.9%
at December 31, 2019. The expected long-term rate of return on plan assets used in determining pension expense for non-U.S.
at December 31, 2019. The expected long-term rate of return on plan assets used in determining pension expense for non-U.S.
plans is determined in a similar manner to the U.S. plans.
plans is determined in a similar manner to the U.S. plans.
Another key assumption in determining net pension and OPEB expense is the assumed discount rate used to discount plan
Another key assumption in determining net pension and OPEB expense is the assumed discount rate used to discount plan
obligations. We estimate the assumed discount rate for U.S. plans using a cash flow matching approach, which uses projected cash
obligations. We estimate the assumed discount rate for U.S. plans using a cash flow matching approach, which uses projected cash
flows matched to spot rates along a high quality corporate bond yield curve to determine the weighted-average discount rate for
flows matched to spot rates along a high quality corporate bond yield curve to determine the weighted-average discount rate for
the calculation of the present value of cash flows. We apply the individual annual yield curve rates instead of the assumed discount
the calculation of the present value of cash flows. We apply the individual annual yield curve rates instead of the assumed discount
rate to determine the service cost and interest cost, which more specifically links the cash flows related to service cost and interest
rate to determine the service cost and interest cost, which more specifically links the cash flows related to service cost and interest
cost to bonds maturing in their year of payment.
cost to bonds maturing in their year of payment.
The Society of Actuaries (SOA) issued mortality improvement tables in the three months ended December 31, 2019. We reviewed
The Society ofActuaries (SOA) issued mortality improvement tables in the three months ended December 31,2019. We reviewed
our recent mortality experience and we determined our current mortality assumptions are appropriate to measure our December
our recent mortality experience and we determined our current mortality assumptions are appropriate to measure our December
31, 2019 U.S. pension and OPEB plans obligations.
31, 2019 U.S. pension and OPEB plans obligations.
37
37
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Significant differences in actual experience or significant changes in assumptions may materially affect the pension obligations.
Significant differences in actual experience or significant changes in assumptions may materially affect the pension obligations.
The effects of actual results differing from assumptions and the changing of assumptions are included in unamortized net actuarial
The effects of actual results differing from assumptions and the changing of assumptions are included in unamortized net actuarial
gains and losses that are subject to amortization to pension expense over future periods. The unamortized pre-tax actuarial loss on
gains and losses that are subject to amortization to pension expense over future periods. The unamortized pre-tax actuarial loss on
our pension plans was $6.7 billion and $4.7 billion at December 31, 2019 and 2018. The year-over-year change is primarily due
our pension plans was $6.7 billion and $4.7 billion at December 31, 2019 and 2018. The year-over-year change is primarily due
to a decrease in discount rates partially offset by higher than expected asset returns. At December 31, 2019, $3.0 billion of the
to a decrease in discount rates partially offset by higher than expected asset returns. At December 31, 2019, $3.0 billion of the
unamortized pre-tax actuarial loss is outside the corridor (primarily 10% of the projected benefit obligation (PBO) and subject to
unamortized pre-tax actuarial loss is outside the corridor (primarily 10% of the projected benefit obligation (PBO) and subject to
amortization. The weighted-average amortization period for the pension obligation is approximately 16 years resulting in
amortization. The weighted-average amortization period for the pension obligation is approximately 16 years resulting in
amortization expense of $0.2 billion in 2020.
amortization expense of $0.2 billion in 2020.
t
t
The underfunded status of the U.S. pension plans increased by $0.4 billion in the year ended December 31, 2019 to $5.4 billion
The underfunded status of the U.S. pension plans increased by $0.4 billion in the year ended December 31, 2019 to $5.4 billion
primarily due to: (1) the unfavorable effect of a decrease in discount rates of $6.4 billion; and (2) service and interest costs of $2.4
primarily due to: (1) the unfavorable effect of a decrease in discount rates of $6.4 billion; and (2) service and interest costs of $2.4
billion; partially offset by (3) a favorable effect of actual returns on plan assets of $8.5 billion.
billion; partially offset by (3) a favorable effect of actual returns on plan assets of $8.5 billion.
The following table illustrates the sensitivity to a change in certain assumptions for the pension plans, holding all other assumptions
The following table illustrates the sensitivity to a change in certain assumptions for the pension plans, holding all other assumptions
constant:
constant:
U.S. Plans(a)
Non-U.S. Plans(a)
U.S. Plans(a) Non-U.S. Plans(a)
Effect on 2020
Effect on 2020
Pension
Pension
Expense
Expense
Effect on
Effect on
December 31,
December 31,
2019 PBO
2019 PBO
Effect on 2020
Effect on 2020
Pension
Pension
Expense
Expense
Effect on
Effect on
December 31,
December 31,
2019 PBO
2019 PBO
25 basis point decrease in discount rate . . . . . . . . . . . . . . . . . . . . . . .
-$99
25 basis point decrease in discount rate -$99
25 basis point increase in discount rate . . . . . . . . . . . . . . . . . . . . . . . .
+$93
25 basis point increase in discount rate +$93
+$139
25 basis point decrease in expected rate of return on assets . . . . . . . .
25 basis point decrease in expected rate of return on assets +$139
-$139
25 basis point increase in expected rate of return on assets . . . . . . . .
-$139
25 basis point increase in expected rate of return on assets
+$1,637
+$1,637
-$1,567
-$1,567
N/A
N/A
N/A
N/A
+$2
+$2
+$4
+$4
+$35
+$35
-$35
-$35
+$664
+$664
-$629
-$629
N/A
N/A
N/A
N/A
__________
(a) The sensitivity does not include the effects of the individual annual yield curve rates applied for the calculation of the service and interest
(a) The sensitivity does not include the effects of the individual annual yield curve rates applied for the calculation of the service and interest
cost.
cost.
Refer to Note 15 to our consolidated financial statements for additional information on pension contributions, investment
Refer to Note 15 to our consolidated fmancial statements for additional information on pension contributions, investment
strategies, assumptions, the change in benefit obligations and related plan assets, pension funding requirements and future net
strategies, assumptions, the change in benefit obligations and related plan assets, pension funding requirements and future net
benefit payments. Refer to Note 2 to our consolidated financial statements for a discussion of the inputs used to determine fair
benefit payments. Refer to Note 2 to our consolidated financial statements for a discussion of the inputs used to determine fair
value for each significant asset class or category.
value for each significant asset class or category.
Valuation of Deferred Tax Assets The ability to realize deferred tax assets depends on the ability to generate sufficient taxable
Valuation of Deferred Tax Assets The ability to realize deferred tax assets depends on the ability to generate sufficient taxable
income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction. The assessment
income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction. The assessment
regarding whether a valuation allowance is required or should be adjusted is based on an evaluation of possible sources of taxable
regarding whether a valuation allowance is required or should be adjusted is based on an evaluation of possible sources of taxable
income and also considers all available positive and negative evidence factors. Our accounting for the valuation of deferred tax
income and also considers all available positive and negative evidence factors. Our accounting for the valuation of deferred tax
assets represents our best estimate of future events. Changes in our current estimates, due to unanticipated market conditions,
assets represents our best estimate of future events. Changes in our current estimates, due to unanticipated market conditions,
governmental legislative actions or events, could have a material effect on our ability to utilize deferred tax assets. Refer to Note
governmental legislative actions or events, could have a material effect on our ability to utilize deferred tax assets. Refer to Note
17 to our consolidated financial statements for additional information on the composition of these valuation allowances.
17 to our consolidated fmancial statements for additional information on the composition of these valuation allowances.
a
Forward-Looking Statements This report and the other reports filed by us with the SEC from time to time, as well as statements
Forward-Looking Statements This report and the other reports filed by us with the SEC from time to time, as well as statements
incorporated by reference herein and related comments by our management, may include "forward-looking statements" within the
incorporated by reference herein and related comments by our management, may include "forward-looking statements" within the
meaning of the U.S. federal securities laws. Forward-looking statements are any statements other than statements of historical
meaning of the U.S. federal securities laws. Forward-looking statements are any statements other than statements of historical
fact. Forward-looking statements represent our current judgment about possible future events and are often identified by words
fact. Forward-looking statements represent our current judgment about possible future events and are often identified by words
like “aim,” “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,”
like "aim," "anticipate," "appears," "approximately," "believe," "continue," "could," "designed," "effect," "estimate," "evaluate,"
“expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “priorities,” “project,”
"expect," "forecast," "goal," "initiative," "intend," "may," "objective," "outlook," "plan," "potential," "priorities," "project,"
“pursue,” “seek,” “should,” “target,” “when,” “will,” “would,” or the negative of any of those words or similar expressions. In
"pursue," "seek," "should," "target," "when," "will," "would," or the negative of any of those words or similar expressions. In
making these statements, we rely on assumptions and analysis based on our experience and perception of historical trends, current
making these statements, we rely on assumptions and analysis based on our experience and perception of historical trends, current
conditions and expected future developments as well as other factors we consider appropriate under the circumstances. We believe
conditions and expected future developments as well as other factors we consider appropriate under the circumstances. We believe
these judgments are reasonable, but these statements are not guarantees of any events or financial results, and our actual results
these judgments are reasonable, but these statements are not guarantees of any events or fmancial results, and our actual results
may differ materially due to a variety of important factors, both positive and negative. These factors, which may be revised or
may differ materially due to a variety of important factors, both positive and negative. These factors, which may be revised or
supplemented in subsequent reports we file with the SEC, include, among others, the following: (1) our ability to deliver new
supplemented in subsequent reports we file with the SEC, include, among others, the following: (1) our ability to deliver new
products, services and customer experiences in response to increased competition in the automotive industry; (2) our ability to
products, services and customer experiences in response to increased competition in the automotive industry; (2) our ability to
timely fund and introduce new and improved vehicle models that are able to attract a sufficient number of consumers; (3) the
timely fund and introduce new and improved vehicle models that are able to attract a sufficient number of consumers; (3) the
success of our crossovers, SUVs and full-size pickup trucks; (4) our ability to successfully and cost-effectively restructure our
success of our crossovers, SUVs and full-size pickup trucks; (4) our ability to successfully and cost-effectively restructure our
operations in the U.S. and various other countries and initiate additional cost reduction actions with minimal disruption; (5) our
operations in the U.S. and various other countries and initiate additional cost reduction actions with minimal disruption; (5) our
38
38
aa
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
ability to reduce the cost of manufacturing electric vehicles and drive increased consumer adoption; (6) the unique technological,
ability to reduce the cost of manufacturing electric vehicles and drive increased consumer adoption; (6) the unique technological,
operational, regulatory and competitive risks related to the timing and commercialization of autonomous vehicles; (7) global
operational, regulatory and competitive risks related to the timing and commercialization of autonomous vehicles; (7) global
automobile market sales volume, which can be volatile; (8) our significant business in China, which is subject to unique operational,
automobile market sales volume, which can be volatile; (8) our significant business in China, which is subject to unique operational,
competitive, regulatory and economic risks; (9) our joint ventures, which we cannot operate solely for our benefit and over which
competitive, regulatory and economic risks; (9) our joint ventures, which we cannot operate solely for our benefit and over which
we may have limited control; (10) the international scale and footprint of our operations, which exposes us to a variety of unique
we may have limited control; (10) the international scale and footprint of our operations, which exposes us to a variety of unique
political, economic, competitive and regulatory risks, including the risk of changes in government leadership and laws (including
political, economic, competitive and regulatory risks, including the risk of changes in government leadership and laws (including
labor, tax and other laws), political instability and economic tensions between governments and changes in international trade
labor, tax and other laws), political instability and economic tensions between governments and changes in international trade
policies, new barriers to entry and changes to or withdrawals from free trade agreements, public health crises, including the
policies, new barriers to entry and changes to or withdrawals from free trade agreements, public health crises, including the
occurrence of a contagious disease or illness, such as the novel coronavirus, changes in foreign exchange rates and interest rates,
occurrence of a contagious disease or illness, such as the novel coronavirus, changes in foreign exchange rates and interest rates,
economic downturns in foreign countries, differing local product preferences and product requirements, compliance with U.S. and
economic downturns in foreign countries, differing local product preferences and product requirements, compliance with U.S. and
foreign countries' export controls and economic sanctions, differing labor regulations, requirements and union relationships,
foreign countries' export controls and economic sanctions, differing labor regulations, requirements and union relationships,
differing dealer and franchise regulations and relationships, and difficulties in obtaining financing in foreign countries; (11) any
differing dealer and franchise regulations and relationships, and difficulties in obtaining fmancing in foreign countries; (11) any
significant disruption, including any work stoppages, at any of our manufacturing facilities; (12) the ability of our suppliers to
significant disruption, including any work stoppages, at any of our manufacturing facilities; (12) the ability of our suppliers to
deliver parts, systems and components without disruption and at such times to allow us to meet production schedules; (13) prices
deliver parts, systems and components without disruption and at such times to allow us to meet production schedules; (13) prices
of raw materials used by us and our suppliers; (14) our highly competitive industry, which is characterized by excess manufacturing
of raw materials used by us and our suppliers; (14) our highly competitive industry, which is characterized by excess manufacturing
capacity and the use of incentives, and the introduction of new and improved vehicle models by our competitors; (15) the possibility
capacity and the use of incentives, and the introduction of new and improved vehicle models by our competitors; (15) the possibility
that competitors may independently develop products and services similar to ours, or that our intellectual property rights are not
that competitors may independently develop products and services similar to ours, or that our intellectual property rights are not
sufficient to prevent competitors from developing or selling those products or services; (16) our ability to manage risks related to
sufficient to prevent competitors from developing or selling those products or services; (16) our ability to manage risks related to
security breaches and other disruptions to our information technology systems and networked products, including connected
security breaches and other disruptions to our information technology systems and networked products, including connected
vehicles and in-vehicle systems; (17) our ability to comply with increasingly complex, restrictive and punitive regulations relating
vehicles and in-vehicle systems; (17) our ability to comply with increasingly complex, restrictive and punitive regulations relating
to our enterprise data practices, including the collection, use, sharing and security of the Personal Identifiable Information of our
to our enterprise data practices, including the collection, use, sharing and security of the Personal Identifiable Information of our
customers, employees, or suppliers; (18) our ability to comply with extensive laws, regulations and policies applicable to our
customers, employees, or suppliers; (18) our ability to comply with extensive laws, regulations and policies applicable to our
operations and products, including those relating to fuel economy and emissions and autonomous vehicles; (19) costs and risks
operations and products, including those relating to fuel economy and emissions and autonomous vehicles; (19) costs and risks
associated with litigation and government investigations; (20) the costs and effect on our reputation of product safety recalls and
associated with litigation and government investigations; (20) the costs and effect on our reputation of product safety recalls and
alleged defects in products and services; (21) any additional tax expense or exposure; (22) our continued ability to develop captive
alleged defects in products and services; (21) any additional tax expense or exposure; (22) our continued ability to develop captive
financing capability through GM Financial; and (23) any significant increase in our pension funding requirements. For a further
financing capability through GM Financial; and (23) any significant increase in our pension funding requirements. For a further
discussion of these and other risks and uncertainties, refer to Item 1A. Risk Factors.
discussion of these and other risks and uncertainties, refer to Item 1A. Risk Factors.
uu
aa
aa
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of
the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements,
the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements,
whether as a result of new information, future events or other factors, except where we are expressly required to do so by law.
whether as a result of new information, future events or other factors, except where we are expressly required to do so by law.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
* * * * * * *
* * * * * * *
The overall financial risk management program is under the responsibility of the Chief Financial Officer with support from the
The overall financial risk management program is under the responsibility of the Chief Financial Officer with support from the
Financial Risk Council, which reviews and, where appropriate, approves strategies to be pursued to mitigate these risks. The
Financial Risk Council, which reviews and, where appropriate, approves strategies to be pursued to mitigate these risks. The
Financial Risk Council comprises members of our management and functions under the oversight of the Audit Committee and
Financial Risk Council comprises members of our management and functions under the oversight of the Audit Committee and
Finance Committee of the Board of Directors. The Audit Committee and Finance Committee assist and guide the Board of Directors
Finance Committee of the Board of Directors. The Audit Committee and Finance Committee assist and guide the Board of Directors
in its oversight of our financial and risk management strategies. A risk management control framework is utilized to monitor the
in its oversight of our fmancial and risk management strategies. A risk management control framework is utilized to monitor the
strategies, risks and related hedge positions in accordance with the policies and procedures approved by the Financial Risk Council.
strategies, risks and related hedge positions in accordance with the policies and procedures approved by the Financial Risk Council.
Our financial risk management policy is designed to protect against risk arising from extreme adverse market movements on our
Our fmancial risk management policy is designed to protect against risk arising from extreme adverse market movements on our
key exposures.
key exposures.
uu
Automotive The following analyses provide quantitative information regarding exposure to foreign currency exchange rate risk,
Automotive The following analyses provide quantitative information regarding exposure to foreign currency exchange rate risk,
interest rate risk and equity price risk. Sensitivity analysis is used to measure the potential loss in the fair value of financial
interest rate risk and equity price risk. Sensitivity analysis is used to measure the potential loss in the fair value of financial
instruments with exposure to market risk. The models used assume instantaneous, parallel shifts in exchange rates and interest
instruments with exposure to market risk. The models used assume instantaneous, parallel shifts in exchange rates and interest
rate yield curves. For options and other instruments with nonlinear returns, models appropriate to these types of instruments are aa
rate yield curves. For options and other instruments with nonlinear returns, models appropriate to these types of instruments are
utilized to determine the effect of market shifts. There are certain shortcomings inherent in the sensitivity analyses presented,
utilized to determine the effect of market shifts. There are certain shortcomings inherent in the sensitivity analyses presented,
primarily due to the assumption that interest rates change in a parallel fashion and that spot exchange rates change instantaneously.
primarily due to the assumption that interest rates change in a parallel fashion and that spot exchange rates change instantaneously.
In addition, the analyses are unable to reflect the complex market reactions that normally would arise from the market shifts
In addition, the analyses are unable to reflect the complex market reactions that normally would arise from the market shifts
modeled and do not contemplate the effects of correlations between foreign currency exposures and offsetting long-short positions
modeled and do not contemplate the effects of correlations between foreign currency exposures and offsetting long-short positions
in currency or other exposures, such as interest rates, which may significantly reduce the potential loss in value.
in currency or other exposures, such as interest rates, which may significantly reduce the potential loss in value.
Foreign Currency Exchange Rate Risk We have foreign currency exposures related to buying, selling and financing in currencies
Foreign Currency Exchange Rate Risk We have foreign currency exposures related to buying, selling and financing in currencies
other than the functional currencies of our operations. At December 31, 2019 our most significant foreign currency exposures were
other than the functional currencies of our operations. At December 31, 2019 our most significant foreign currency exposures were
39
39
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
between the U.S. Dollar and the Canadian Dollar, Korean Won, Euro, Brazilian Real, Australian Dollar, Mexican Peso and Chinese
between the U.S. Dollar and the Canadian Dollar, Korean Won, Euro, Brazilian Real, Australian Dollar, Mexican Peso and Chinese
Yuan. Derivative instruments such as foreign currency forwards, swaps and options are primarily used to hedge exposures with
Yuan. Derivative instruments such as foreign currency forwards, swaps and options are primarily used to hedge exposures with
respect to forecasted revenues, costs and commitments denominated in foreign currencies. Such contracts had remaining maturities
respect to forecasted revenues, costs and commitments denominated in foreign currencies. Such contracts had remaining maturities
of up to 12 months at December 31, 2019.
of up to 12 months at December 31, 2019.
The net fair value liability of financial instruments with exposure to foreign currency risk was $1.4 billion and $0.9 billion at
The net fair value liability of fmancial instruments with exposure to foreign currency risk was $1.4 billion and $0.9 billion at
December 31, 2019 and 2018. These amounts are calculated utilizing a population of foreign currency exchange derivatives and
December 31, 2019 and 2018. These amounts are calculated utilizing a population of foreign currency exchange derivatives and
foreign currency denominated debt and exclude the offsetting effect of foreign currency cash, cash equivalents and other assets.
foreign currency denominated debt and exclude the offsetting effect of foreign currency cash, cash equivalents and other assets.
The potential loss in fair value for such financial instruments from a 10% adverse change in all quoted foreign currency exchange
The potential loss in fair value for such fmancial instruments from a 10% adverse change in all quoted foreign currency exchange
rates would have been $0.2 billion and $0.1 billion at December 31, 2019 and 2018.
rates would have been $0.2 billion and $0.1 billion at December 31, 2019 and 2018.
We are exposed to foreign currency risk due to the translation and remeasurement of the results of certain international operations
We are exposed to foreign currency risk due to the translation and remeasurement of the results of certain international operations
into U.S. Dollars as part of the consolidation process. We had foreign currency derivatives with notional amounts of $5.1 billion
into U.S. Dollars as part of the consolidation process. We had foreign currency derivatives with notional amounts of $5.1 billion
and $2.7 billion at December 31, 2019 and 2018. The fair value of these derivative financial instruments was insignificant.
and $2.7 billion at December 31, 2019 and 2018. The fair value of these derivative fmancial instruments was insignificant.
Fluctuations in foreign currency exchange rates can therefore create volatility in the results of operations and may adversely affect
Fluctuations in foreign currency exchange rates can therefore create volatility in the results of operations and may adversely affect
our financial condition.
our fmancial condition.
The following table summarizes the amounts of automotive foreign currency translation and transaction and remeasurement
The following table summarizes the amounts of automotive foreign currency translation and transaction and remeasurement
(gains) losses:
(gains) losses:
Years Ended December 31,
Years Ended December 31,
2019
2018
2019 2018
$
Translation losses recorded in Accumulated other comprehensive loss . . . . . . . . . . . . . . . $
32
$
Translation losses recorded in Accumulated other comprehensive loss 32
(77) $
Transaction and remeasurement (gains) losses recorded in earnings . . . . . . . . . . . . . . . . . $
Transaction and remeasurement (gains) losses recorded in earnings (77) $
353
353
156
156
Interest Rate Risk We are subject to market risk from exposure to changes in interest rates related to certain financial instruments,
Interest Rate Risk We are subject to market risk from exposure to changes in interest rates related to certain financial instruments,
primarily debt, finance lease obligations and certain marketable debt securities. We did not have any interest rate swap positions
primarily debt, fmance lease obligations and certain marketable debt securities. We did not have any interest rate swap positions
to manage interest rate exposures in our automotive operations at December 31, 2019 and 2018. The fair value liability of debt
to manage interest rate exposures in our automotive operations at December 31, 2019 and 2018. The fair value liability of debt
and finance leases was $15.9 billion and $13.5 billion at December 31, 2019 and 2018. The potential increase in fair value resulting
and fmance leases was $15.9 billion and $13.5 billion at December 31, 2019 and 2018. The potential increase in fair value resulting
from a 10% decrease in quoted interest rates would have been $0.6 billion and $0.8 billion at December 31, 2019 and 2018.
from a 10% decrease in quoted interest rates would have been $0.6 billion and $0.8 billion at December 31, 2019 and 2018.
We had marketable debt securities of $4.2 billion and $6.0 billion classified as available-for-sale at December 31, 2019 and
We had marketable debt securities of $4.2 billion and $6.0 billion classified as available-for-sale at December 31, 2019 and
2018. The potential decrease in fair value from a 50 basis point increase in interest rates would have had an insignificant effect at
2018. The potential decrease in fair value from a 50 basis point increase in interest rates would have had an insignificant effect at
December 31, 2019 and 2018.
December 31, 2019 and 2018.
ff
Equity Price Risk We are subject to equity price risk due to market price volatility related to our investment in Lyft and PSA
Equity Price Risk We are subject to equity price risk due to market price volatility related to our investment in Lyft and PSA
warrants. The fair value of investments with exposure to equity price risk was $1.5 billion at December 31, 2019. In March 2019
warrants. The fair value of investments with exposure to equity price risk was $1.5 billion at December 31, 2019. In March 2019
Lyft filed for an initial public offering, which significantly increased the volatility in the fair value of our investment in Lyft. Our
Lyft filed for an initial public offering, which significantly increased the volatility in the fair value of our investment in Lyft. Our
investment in Lyft is valued based on the quoted market price, and our investment in PSA warrants is valued based on a Black-
investment in Lyft is valued based on the quoted market price, and our investment in PSA warrants is valued based on a Black-
Scholes formula. We estimate that a 10% adverse change in quoted security prices in Lyft and PSA Group would impact our
Scholes formula. We estimate that a 10% adverse change in quoted security prices in Lyft and PSA Group would impact our
investments by $0.1 billion.
investments by $0.1 billion.
Automotive Financing - GM Financial
Automotive Financing - GM Financial
k
Interest Rate Risk Fluctuations in market interest rates can affect GM Financial's gross interest rate spread, which is the difference
InterestRate Risk Fluctuations in market interest rates can affect GM Financial's gross interest rate spread, which is the difference
between interest earned on finance receivables and interest paid on debt. GM Financial is exposed to interest rate risks as financial
between interest earned on fmance receivables and interest paid on debt. GM Financial is exposed to interest rate risks as financial
assets and liabilities have different characteristics that may impact financial performance. These differences may include tenor,
assets and liabilities have different characteristics that may impact financial performance. These differences may include tenor,
yield, re-pricing timing, and prepayment expectations. Typically retail finance receivables and leases purchased by GM Financial
yield, re-pricing timing, and prepayment expectations. Typically retail fmance receivables and leases purchased by GM Financial
earn fixed interest and commercial finance receivables originated by GM Financial earn variable interest. GM Financial funds its
earn fixed interest and commercial finance receivables originated by GM Financial earn variable interest. GM Financial funds its
business with variable or fixed rate debt. The variable rate debt is subject to adjustments to reflect prevailing market interest rates.
business with variable or fixed rate debt. The variable rate debt is subject to adjustments to reflect prevailing market interest rates.
To help mitigate interest rate risk or mismatched funding, GM Financial may employ hedging.
To help mitigate interest rate risk or mismatched funding, GM Financial may employ hedging.
Quantitative Disclosure GM Financial measures the sensitivity of its net interest income to changes in interest rates by using
Quantitative Disclosure GM Financial measures the sensitivity of its net interest income to changes in interest rates by using
interest rate scenarios that assume a hypothetical, instantaneous parallel shift of one hundred basis points in all interest rates across
interest rate scenarios that assume a hypothetical, instantaneous parallel shift of one hundred basis points in all interest rates across
all maturities, as well as a base case that assumes that rates perform at the current market forward curve. However, interest rate
all maturities, as well as a base case that assumes that rates perform at the current market forward curve. However, interest rate
changes are rarely instantaneous or parallel and rates could move more or less than the one percentage point assumed in our
changes are rarely instantaneous or parallel and rates could move more or less than the one percentage point assumed in our
40
40
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
analysis. Therefore, the actual impact to net interest income could be higher or lower than the results detailed in the table below.
analysis. Therefore, the actual impact to net interest income could be higher or lower than the results detailed in the table below.
These interest rate scenarios are purely hypothetical and do not represent our view of future interest rate movements.
These interest rate scenarios are purely hypothetical and do not represent our view of future interest rate movements.
At December 31, 2019, GM Financial was liability-sensitive, meaning that more liabilities than assets were expected to re-price
At December 31, 2019, GM Financial was liability-sensitive, meaning that more liabilities than assets were expected to re-price
within the next twelve months. During a period of rising interest rates, the interest paid on liabilities would increase more than the
within the next twelve months. During a period of rising interest rates, the interest paid on liabilities would increase more than the
interest earned on assets, which would initially decrease net interest income. During a period of falling interest rates, net interest
interest earned on assets, which would initially decrease net interest income. During a period of falling interest rates, net interest
income would be expected to initially increase. At December 31, 2018, GM Financial was asset-sensitive, meaning that more
income would be expected to initially increase. At December 31, 2018, GM Financial was asset-sensitive, meaning that more
assets than liabilities were expected to re-price within the next twelve months. During a period of rising interest rates, the interest
assets than liabilities were expected to re-price within the next twelve months. During a period of rising interest rates, the interest
earned on assets would increase more than the interest paid on debt, which would initially increase net interest income. During a
earned on assets would increase more than the interest paid on debt, which would initially increase net interest income. During a
period of falling interest rates, net interest income would be expected to initially decrease.
period of falling interest rates, net interest income would be expected to initially decrease.
t
GM Financial's net interest income sensitivity continued to decrease in 2019 from 2018 primarily due to GM Financial's strategy
GM Financial's net interest income sensitivity continued to decrease in 2019 from 2018 primarily due to GM Financial's strategy
of hedging fixed-rate asset originations with pay-fixed interest rate swaps. The following table presents GM Financial's net interest
of hedging fixed-rate asset originations with pay-fixed interest rate swaps. The following table presents GM Financial's net interest
income sensitivity to interest rate movement:
income sensitivity to interest rate movement:
Years Ended December 31,
Years Ended December 31,
2019
2018
2019 2018
One hundred basis points instantaneous increase in interest rates . . . . . . . . . . . . . . . . . . . $
One hundred basis points instantaneous increase in interest rates S
One hundred basis points instantaneous decrease in interest rates(a). . . . . . . . . . . . . . . . . $
One hundred basis points instantaneous decrease in interest rates(a) S
__________
(a) Net interest income sensitivity given a one hundred basis point decrease in interest rates requires an assumption of negative interest rates
(a) Net interest income sensitivity given a one hundred basis point decrease in interest rates requires an assumption of negative interest rates
(4.6) $
(4.6) $
$
4.6
$
4.6
10.7
10.7
(10.7)
(10.7)
in markets where existing interest rates are below one percent.
in markets where existing interest rates are below one percent.
Additional Model Assumptions The sensitivity analysis presented is GM Financial's best estimate of the effect of the hypothetical
Additional Model Assumptions The sensitivity analysis presented is GM Financial's best estimate of the effect of the hypothetical
interest rate scenarios; however, actual results could differ. The estimates are also based on assumptions including the amortization
interest rate scenarios; however, actual results could differ. The estimates are also based on assumptions including the amortization
and prepayment of the finance receivable portfolio, originations of finance receivables and leases, refinancing of maturing debt,
and prepayment of the finance receivable portfolio, originations of finance receivables and leases, refmancing of maturing debt,
replacement of maturing derivatives and exercise of options embedded in debt and derivatives. The prepayment projections are
replacement of maturing derivatives and exercise of options embedded in debt and derivatives. The prepayment projections are
based on historical experience. If interest rates or other factors change, actual prepayment experience could be different than
based on historical experience. If interest rates or other factors change, actual prepayment experience could be different than
projected.
projected.
Foreign Currency Exchange Rate Risk GM Financial is exposed to foreign currency risk due to the translation and
Foreign Currency Exchange Rate Risk GM Financial is exposed to foreign currency risk due to the translation and
remeasurement of the results of certain international operations into U.S. Dollars as part of the consolidation process. Fluctuations
remeasurement of the results of certain international operations into U.S. Dollars as part of the consolidation process. Fluctuations
in foreign currency exchange rates can therefore create volatility in the results of operations and may adversely affect GM Financial's
in foreign currency exchange rates can therefore create volatility in the results of operations and may adversely affect GM Financial's
financial condition.
financial condition.
GM Financial primarily finances its receivables and leased assets with debt in the same currency. When a different currency is
GM Financial primarily fmances its receivables and leased assets with debt in the same currency. When a different currency is
used GM Financial may use foreign currency swaps to convert substantially all of its foreign currency debt obligations to the local
used GM Financial may use foreign currency swaps to convert substantially all of its foreign currency debt obligations to the local
currency of the receivables and lease assets to minimize any impact to earnings.
currency of the receivables and lease assets to minimize any impact to earnings.
GM Financial had foreign currency swaps with notional amounts of $6.2 billion and $3.9 billion at December 31, 2019 and
GM Financial had foreign currency swaps with notional amounts of $6.2 billion and $3.9 billion at December 31, 2019 and
2018. The fair value of these derivative financial instruments was insignificant at December 31, 2019 and 2018.
2018. The fair value of these derivative fmancial instruments was insignificant at December 31, 2019 and 2018.
The following table summarizes GM Financial's foreign currency translation and transaction and remeasurement (gains) losses:
The following table summarizes GM Financial's foreign currency translation and transaction and remeasurement (gains) losses:
Translation (gains) losses recorded in Accumulated other comprehensive loss . . . . . . . . . $
Translation (gains) losses recorded in Accumulated other comprehensive loss
Transaction and remeasurement (gains) losses, net recorded in earnings. . . . . . . . . . . . . . $
Transaction and remeasurement (gains) losses, net recorded in earnings
Years Ended December 31,
Years Ended December 31,
2019
2018
2019 2018
(5) $
(8) $
291
291
12
12
* * * * * * *
* * * * * * *
41
41
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of General Motors Company
To the Shareholders and the Board of Directors of General Motors Company
Opinion on the Financial Statements
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of General Motors Company and subsidiaries (the Company) as
We have audited the accompanying consolidated balance sheets of General Motors Company and subsidiaries (the Company) as
of December 31, 2019 and 2018, the related consolidated statements of income, comprehensive income, cash flows, and equity
of December 31, 2019 and 2018, the related consolidated statements of income, comprehensive income, cash flows, and equity
for the two years in the period ended December 31, 2019, and the related notes (collectively referred to as the “financial statements”).
for the two years in the period ended December 31, 2019, and the related notes (collectively referred to as the "financial statements").
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company at December
In our opinion, the fmancial statements present fairly, in all material respects, the financial position of the Company at December
31, 2019 and 2018, and the results of its operations and its cash flows for each of the two years in the period ended December 31,
31, 2019 and 2018, and the results of its operations and its cash flows for each of the two years in the period ended December 31,
2019, in conformity with U.S. generally accepted accounting principles.
2019, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in
(PCAOB), the Company's internal control over fmancial reporting as of December 31, 2019, based on criteria established in
Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(2013 framework) and our report dated February 5, 2020 expressed an unqualified opinion thereon.
(2013 framework) and our report dated February 5, 2020 expressed an unqualified opinion thereon.
Adoption of Accounting Standards Update (ASU) No. 2014-09
Adoption of Accounting Standards Update (ASU) No. 2014-09
As discussed in Note 2 to the financial statements, the Company changed its method of accounting for revenue from contracts
As discussed in Note 2 to the fmancial statements, the Company changed its method of accounting for revenue from contracts
with customers in 2018 due to the adoption of ASU No. 2014-09, "Revenue from Contracts with Customers," as amended.
with customers in 2018 due to the adoption of ASU No. 2014-09, "Revenue from Contracts with Customers," as amended.
Basis for Opinion
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
These fmancial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error
or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether
or fraud. Our audits included performing procedures to assess the risks of material misstatement of the fmancial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting
evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial
principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial
statements. We believe that our audits provide a reasonable basis for our opinion.
statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that
were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are
were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are
material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The
material to the fmancial statements and (2) involved our especially challenging, subjective or complex judgments. The
communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and
communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and
we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the
we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the
accounts or disclosures to which they relate.
accounts or disclosures to which they relate.
Description of the matter
Description of the matter
Product warranty and recall campaigns
Product warranty and recall campaigns
As discussed in Note 12 to the financial statements, the liabilities for product warranty and recall
As discussed in Note 12 to the financial statements, the liabilities for product warranty and recall
campaigns amount to $7.8 billion at December 31, 2019. The Company accrues for costs related
campaigns amount to $7.8 billion at December 31, 2019. The Company accrues for costs related
to product warranty at the time of vehicle sale and accrues the estimated cost of recall campaigns
to product warranty at the time of vehicle sale and accrues the estimated cost of recall campaigns
when they are probable and estimable, which is generally at the time of sale.
when they are probable and estimable, which is generally at the time of sale.
42
42
How we addressed the
How we addressed the
matter in our audit
matter in our audit
Description of the matter
Description of the matter
How we addressed the
How we addressed the
matter in our audit
matter in our audit
Auditing these liabilities is complex and involves a high degree of subjectivity in evaluating
Auditing these liabilities is complex and involves a high degree of subjectivity in evaluating
management’s estimates, due to the size, uncertainties, and potential volatility related to the
management's estimates, due to the size, uncertainties, and potential volatility related to the
estimated liabilities. Management’s estimates consider historical claims experience, including the
estimated liabilities. Management's estimates consider historical claims experience, including the
nature, frequency, and average cost of claims of each vehicle line or each model year of the vehicle
nature, frequency, and average cost of claims of each vehicle line or each model year of the vehicle
line, and the key assumptions of historical data being predictive of future activity and events, in
line, and the key assumptions of historical data being predictive of future activity and events, in
particular, the number of historical periods used and the weighing of historical data in the reserve
particular, the number of historical periods used and the weighing of historical data in the reserve
studies.
studies.
We evaluated the design and tested the operating effectiveness of internal controls over the
We evaluated the design and tested the operating effectiveness of internal controls over the
Company’s product warranty and recall campaign processes. We tested internal controls over
Company's product warranty and recall campaign processes. We tested internal controls over
management’s review of the valuation models and significant assumptions for product warranty
management's review of the valuation models and significant assumptions for product warranty
and recall including the warranty claims forecasted based on the frequency and average cost per
and recall including the warranty claims forecasted based on the frequency and average cost per
warranty claim for product warranty, and the cost estimates related to recall campaigns. Our audit
warranty claim for product warranty, and the cost estimates related to recall campaigns. Our audit
also included the evaluation of controls that address the completeness and accuracy of the data
also included the evaluation of controls that address the completeness and accuracy of the data
utilized in the valuation models.
utilized in the valuation models.
Our audit procedures related to product warranty and recall campaigns also included, among others,
Our audit procedures related to product warranty and recall campaigns also included, among others,
evaluating the Company’s estimation methodology, the related significant assumptions and
evaluating the Company's estimation methodology, the related significant assumptions and
underlying data, and performing analytical procedures to corroborate cost per vehicle based on
underlying data, and performing analytical procedures to corroborate cost per vehicle based on
historical claims data. Furthermore, we performed sensitivity analyses to evaluate the significant
historical claims data. Furthermore, we performed sensitivity analyses to evaluate the significant
judgments made by management, including cost estimates to evaluate the impact on reserves from
judgments made by management, including cost estimates to evaluate the impact on reserves from
changes in assumptions. We performed analysis over the vehicle lines and model years that had
changes in assumptions. We performed analysis over the vehicle lines and model years that had
little or no claims experience to ensure the vehicle and model substitutions are comparable. We
little or no claims experience to ensure the vehicle and model substitutions are comparable. We
also involved actuarial specialists to evaluate the methodologies and assumptions, and to test the
also involved actuarial specialists to evaluate the methodologies and assumptions, and to test the
actuarial calculations used by the Company.
actuarial calculations used by the Company.
Sales incentives
Sales incentives
Automotive sales and revenue represents the amount of consideration to which the Company
Automotive sales and revenue represents the amount of consideration to which the Company
expects to be entitled in exchange for transferring goods or providing services, which is net of
expects to be entitled in exchange for transferring goods or providing services, which is net of
dealer and customer sales incentives the Company expects to pay. As discussed in Note 2 to the
dealer and customer sales incentives the Company expects to pay. As discussed in Note 2 to the
financial statements, provisions for dealer and customer incentives are recorded as a reduction to
fmancial statements, provisions for dealer and customer incentives are recorded as a reduction to
Automotive net sales and revenue at the time of vehicle sale. The liabilities for dealer and customer
Automotive net sales and revenue at the time of vehicle sale. The liabilities for dealer and customer
allowances, claims and discounts amount to $10.4 billion at December 31, 2019.
allowances, claims and discounts amount to $10.4 billion at December 31, 2019.
Auditing the estimate of sales incentives involved a high degree of judgment. Significant factors
Auditing the estimate of sales incentives involved a high degree of judgment. Significant factors
used by the Company in estimating its liability for retail incentives include forecasted sales
used by the Company in estimating its liability for retail incentives include forecasted sales
volumes, product mix, and the rate of customer acceptance of incentive programs, all of which
volumes, product mix, and the rate of customer acceptance of incentive programs, all of which
are estimated based on historical experience and assumptions concerning future customer behavior
are estimated based on historical experience and assumptions concerning future customer behavior
and market conditions. The Company’s estimation model reflects the best estimate of the total
and market conditions. The Company's estimation model reflects the best estimate of the total
incentive amount that the Company reasonably expects to pay at the time of sale. The estimated
incentive amount that the Company reasonably expects to pay at the time of sale. The estimated
cost of incentives is forward-looking, and could be materially affected by future economic and
cost of incentives is forward-looking, and could be materially affected by future economic and
market conditions.
market conditions.
We evaluated the design and tested the operating effectiveness of internal controls over the
We evaluated the design and tested the operating effectiveness of internal controls over the
Company’s sales incentive process, including management’s review of the estimation model, the
Company's sales incentive process, including management's review of the estimation model, the
significant assumptions (e.g., incentive cost per unit, customer take rate, and market conditions),
significant assumptions (e.g., incentive cost per unit, customer take rate, and market conditions),
and the data inputs used in the model.
and the data inputs used in the model.
Our audit procedures included, among others, the performance of analytical procedures to develop
Our audit procedures included, among others, the performance of analytical procedures to develop
an independent range of the liability for retail incentives as of the balance sheet date. Our
an independent range of the liability for retail incentives as of the balance sheet date. Our
independent range was developed for comparison to the Company’s recorded accrual, and is based
independent range was developed for comparison to the Company's recorded accrual, and is based
on historical claims, forecasted spend, and the specific vehicle mix of current dealer stock. In
on historical claims, forecasted spend, and the specific vehicle mix of current dealer stock. In
addition, we performed sensitivity analyses over the cost per unit assumption developed by
addition, we performed sensitivity analyses over the cost per unit assumption developed by
management to evaluate the impact on the liability resulting from a change in the assumption.
management to evaluate the impact on the liability resulting from a change in the assumption.
Lastly, we assessed management’s forecasting process by performing quarterly hindsight analyses
Lastly, we assessed management's forecasting process by performing quarterly hindsight analyses
to assess the adequacy of prior forecasts.
to assess the adequacy of prior forecasts.
43
43
Description of the matter
Description of the matter
How we addressed the
How we addressed the
matter in our audit
matter in our audit
Valuation of GM Financial Equipment on Operating Leases
Valuation of GM Financial Equipment on Operating Leases
GM Financial has recorded investments in vehicles leased to retail customers under operating
GM Financial has recorded investments in vehicles leased to retail customers under operating
leases. As discussed in Note 2 to the financial statements, at the beginning of the lease, management
leases. As discussed in Note 2 to the fmancial statements, at the beginning of the lease, management
establishes an expected residual value for each vehicle at the end of the lease term. The Company’s
establishes an expected residual value for each vehicle at the end of the lease term. The Company's
estimated residual value of leased vehicles at the end of lease term was $30.4 billion as of December
estimated residual value of leased vehicles at the end of lease term was $30.4 billion as of December
31, 2019.
31, 2019.
Auditing management’s estimate of the residual value of leased vehicles involved a high degree
Auditing management's estimate of the residual value of leased vehicles involved a high degree
of judgment. Management’s estimate is based, in part, on third-party data which considers inputs
of judgment. Management's estimate is based, in part, on third-party data which considers inputs
including recent auction values and significant assumptions regarding the expected future volume
including recent auction values and significant assumptions regarding the expected future volume
of leased vehicles that will be returned to the Company, used car prices, manufacturer incentive
of leased vehicles that will be returned to the Company, used car prices, manufacturer incentive
programs and fuel prices. Realization of the residual values is dependent on the future ability to
programs and fuel prices. Realization of the residual values is dependent on the future ability to
market the vehicles under future prevailing market conditions.
market the vehicles under future prevailing market conditions.
We obtained an understanding, evaluated the design and tested the operating effectiveness of the
We obtained an understanding, evaluated the design and tested the operating effectiveness of the
Company’s controls over the lease residual estimation process, including controls over
Company's controls over the lease residual estimation process, including controls over
management’s review of residual value estimates obtained from the Company’s third-party
management's review of residual value estimates obtained from the Company's third-party
provider and other significant assumptions.
provider and other significant assumptions.
Our procedures also included, among others, independently recalculating depreciation related to
Our procedures also included, among others, independently recalculating depreciation related to
equipment on operating lease and performing sensitivity analyses related to significant
equipment on operating lease and performing sensitivity analyses related to significant
assumptions. We also performed hindsight analyses to assess the propriety of management’s
assumptions. We also performed hindsight analyses to assess the propriety of management's
estimate of residual values, as well as tested the completeness and accuracy of data from underlying
estimate of residual values, as well as tested the completeness and accuracy of data from underlying
systems and data warehouses that are used in the estimation models.
systems and data warehouses that are used in the estimation models.
/s/ ERNST & YOUNG LLP
Is/ ERNST & YOUNG LLP
We have served as the Company's auditor since 2017.
We have served as the Company's auditor since 2017.
Detroit, Michigan
Detroit, Michigan
February 5, 2020
February 5, 2020
44
44
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of General Motors Company
To the Shareholders and the Board of Directors of General Motors Company
Opinion on Internal Control over Financial Reporting
Opinion on Internal Control over Financial Reporting
We have audited General Motors Company and subsidiaries’ internal control over financial reporting as of December 31, 2019,
We have audited General Motors Company and subsidiaries' internal control over financial reporting as of December 31, 2019,
based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of
based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, General Motors Company and subsidiaries (the
the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, General Motors Company and subsidiaries (the
Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based
Company) maintained, in all material respects, effective internal control over fmancial reporting as of December 31, 2019, based
on the COSO criteria.
on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company as of December 31, 2019 and 2018, the related consolidated statements
(PCAOB), the consolidated balance sheets of the Company as of December 31, 2019 and 2018, the related consolidated statements
of income, comprehensive income, cash flows and equity for the two years in the period ended December 31, 2019, and the related
of income, comprehensive income, cash flows and equity for the two years in the period ended December 31, 2019, and the related
notes and our report dated February 5, 2020 expressed an unqualified opinion thereon.
notes and our report dated February 5, 2020 expressed an unqualified opinion thereon.
Basis for Opinion
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment
The Company's management is responsible for maintaining effective internal control over fmancial reporting and for its assessment
of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal
of the effectiveness of internal control over financial reporting included in the accompanying Management's Report on Internal
Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial
Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial
reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with
reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
and Exchange Commission and the PCAOB.
and Exchange Commission and the PCAOB.
uu
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
respects.
respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
Our audit included obtaining an understanding of internal control over fmancial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing
such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for
such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for
our opinion.
our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
A company's internal control over fmancial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
of fmancial reporting and the preparation of fmancial statements for external purposes in accordance with generally accepted
accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain
accounting principles. A company's internal control over fmancial reporting includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets
to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets
of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that
could have a material effect on the financial statements.
could have a material effect on the financial statements.
a
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because
of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ ERNST & YOUNG LLP
Is/ ERNST & YOUNG LLP
Detroit, Michigan
Detroit, Michigan
February 5, 2020
February 5,2020
45
45
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of General Motors Company:
To the shareholders and the Board of Directors of General Motors Company:
Opinion on the Financial Statements
Opinion on the Financial Statements
We have audited the accompanying Consolidated Statements of Income, Comprehensive Income, Cash Flows, and Equity of
We have audited the accompanying Consolidated Statements of Income, Comprehensive Income, Cash Flows, and Equity of
General Motors Company and subsidiaries (the "Company") for the year ended December 31, 2017, and the related notes
General Motors Company and subsidiaries (the "Company") for the year ended December 31, 2017, and the related notes
(collectively referred to as the "financial statements"). In our opinion, the 2017 financial statements present fairly, in all material
(collectively referred to as the "financial statements"). In our opinion, the 2017 financial statements present fairly, in all material
respects, the results of the Company's operations and its cash flows for the year ended December 31, 2017, in conformity with
respects, the results of the Company's operations and its cash flows for the year ended December 31, 2017, in conformity with
accounting principles generally accepted in the United States of America.
accounting principles generally accepted in the United States of America.
Basis for Opinion
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on
the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company
the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission
and the PCAOB.
and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error
audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error
or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether
or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting
evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting
principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial
principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial
statements. We believe that our audit provide a reasonable basis for our opinion.
statements. We believe that our audit provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
ls/ Deloitte & Touche LLP
Detroit, Michigan
Detroit, Michigan
February 6, 2018 (July 25, 2018 as to Note 25, Segment Reporting)g
February 6, 2018 (July 25, 2018 as to Note 25, Segment Reporting)
We began serving as the Company's auditor in 1918. In 2018 we became the predecessor auditor.
We began serving as the Company's auditor in 1918. In 2018 we became the predecessor auditor.
46
46
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Item 8. Financial Statements and Supplementary Data
Item 8. Financial Statements and Supplementary Data
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS
(In millions, except per share amounts)
(In millions, except per share amounts)
Years Ended December 31,
Years Ended December 31,
2018
2018
2017
2017
2019
2019
Net sales and revenue
Net sales and revenue
$
133,045
$ 133,045
14,004
14,004
147,049
147,049
Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
122,697
Automotive $ 122,697
14,540
GM Financial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
GM Financial 14,540
Total net sales and revenue (Note 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
137,237
Total net sales and revenue (Note 3) 137,237
Costs and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Costs and expenses
120,656
Automotive and other cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
110,651
120,656
Automotive and other cost of sales 110,651
12,298
12,614
GM Financial interest, operating and other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12,298
GM Financial interest, operating and other expenses 12,614
9,650
Automotive and other selling, general and administrative expense . . . . . . . . . . . . . . . . . . . .
8,491
9,650
Automotive and other selling, general and administrative expense 8,491
142,604
131,756
Total costs and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
142,604
Total costs and expenses 131,756
4,445
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,481
4,445
Operating income 5,481
Automotive interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
655
782
655
Automotive interest expense 782
2,596
Interest income and other non-operating income, net (Note 19) . . . . . . . . . . . . . . . . . . . . . . . .
1,469
2,596
Interest income and other non-operating income, net (Note 19) 1,469
2,163
Equity income (Note 8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,268
2,163
Equity income (Note 8) 1,268
8,549
Income before income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,436
8,549
Income before income taxes 7,436
474
769
Income tax expense (Note 17) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
474
Income tax expense (Note 17) 769
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,075
6,667
8,075
Income from continuing operations 6,667
70
Loss from discontinued operations, net of tax (Note 22) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Loss from discontinued operations, net of tax (Note 22) 70
Net income (loss). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,005
6,667
8,005
Net income (loss) 6,667
9
65
Net loss attributable to noncontrolling interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9
Net loss attributable to noncontrolling interests 65
Net income (loss) attributable to stockholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
$
8,014
6,732
Net income (loss) attributable to stockholders $ 6,732
$ 8,014
$
133,449
$ 133,449
12,139
12,139
145,588
145,588
116,229
116,229
11,128
11,128
9,570
9,570
136,927
136,927
8,661
8,661
575
575
1,645
1,645
2,132
2,132
11,863
11,863
11,533
11,533
330
330
4,212
4,212
(3,882)
(3,882)
18
18
$
)
(3,864)
(
$ (3,864)
Net income (loss) attributable to common stockholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net income (loss) attributable to common stockholders $ 6,581
6,581
$
7,916
$ 7,916
$
(3,880)
$ (3,880)
Earnings per share (Note 21)
Earnings per share (Note 21)
Basic earnings per common share – continuing operations
4.62
. . . . . . . . . . . . . . . . . . . . . . . . . . $
Basic earnings per common share - continuing operations $ 4.62
Basic loss per common share – discontinued operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Basic loss per common share - discontinued operations $
Basic earnings (loss) per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4.62
Basic earnings (loss) per common share $ 4.62
1,424
Weighted-average common shares outstanding – basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average common shares outstanding - basic 1,424
$
5.66
$ 5.66
0.05
— $
$ 0.05
5.61
$
$ 5.61
1,411
1,411
–
Diluted earnings per common share – continuing operations
4.57
. . . . . . . . . . . . . . . . . . . . . . . . . $
Diluted earnings per common share - continuing operations $ 4.57
Diluted loss per common share – discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Diluted loss per common share - discontinued operations $
Diluted earnings (loss) per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4.57
Diluted earnings (loss) per common share $ 4.57
1,439
Weighted-average common shares outstanding – diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average common shares outstanding - diluted 1,439
$
5.58
$ 5.58
0.05
— $
$ 0.05
5.53
$
$ 5.53
1,431
1,431
–
$
0.23
$ 0.23
$
2.88
$ 2.88
(2.65)
$
$ (2.65)
1,465
1,465
$
0.22
$ 0.22
$
2.82
$ 2.82
(2.60)
$
$ (2.60)
1,492
1,492
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions)
(In millions)
Years Ended December 31,
Years Ended December 31,
2018
2018
2019
2019
2017
2017
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Net income (loss) $ 6,667
6,667
Other comprehensive income (loss), net of tax (Note 20)
Other comprehensive income (loss), net of tax (Note 20)
$
8,005
$ 8,005
$
(3,882)
$ (3,882)
Foreign currency translation adjustments and other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustments and other (6)
(6)
Defined benefit plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Defined benefit plans (2,122)
(2,122)
Other comprehensive income (loss), net of tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income (loss), net of tax (2,128)
(2,128)
Comprehensive income (loss). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Comprehensive income (loss) 4,539
4,539
Comprehensive loss attributable to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . .
Comprehensive loss attributable to noncontrolling interests 76
76
Comprehensive income (loss) attributable to stockholders. . . . . . . . . . . . . . . . . . . . . . . . . $
Comprehensive income (loss) attributable to stockholders $ 4,615
4,615
(715)
(715)
(221)
(221)
(936)
(936)
7,069
7,069
15
15
747
747
570
570
1,317
1,317
(2,565)
(2,565)
20
20
$
7,084
$ 7,084
$
(2,545)
$ (2,545)
Reference should be made to the notes to consolidated financial statements.
Reference should be made to the notes to consolidated financial statements.
47
47
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS
(In millions, except per share amounts)
(In millions, except per share amounts)
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Current Assets
Current Assets
ASSETS
ASSETS
19,069
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash and cash equivalents $ 19,069
Marketable debt securities (Note 4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,174
Marketable debt securities (Note 4) 4,174
Accounts and notes receivable (net of allowance of $201 and $211) . . . . . . . . . . . . . . . . . . . . . . . .
6,797
Accounts and notes receivable (net of allowance of $201 and $211) 6,797
GM Financial receivables, net (Note 5; Note 11 at VIEs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,601
GM Financial receivables, net (Note 5; Note 11 at VIEs) 26,601
10,398
Inventories (Note 6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Inventories (Note 6) 10,398
Other current assets (Note 4; Note 11 at VIEs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,953
Other current assets (Note 4; Note 11 at VIEs) 7,953
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
74,992
Total current assets 74,992
20,844
$
$ 20,844
5,966
5,966
6,549
6,549
26,850
26,850
9,816
9,816
5,268
5,268
75,293
75,293
Non-current Assets
Non-current Assets
GM Financial receivables, net (Note 5; Note 11 at VIEs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,355
GM Financial receivables, net (Note 5; Note 11 at VIEs) 26,355
8,562
Equity in net assets of nonconsolidated affiliates (Note 8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in net assets of nonconsolidated affiliates (Note 8) 8,562
Property, net (Note 9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
38,750
Property, net (Note 9) 38,750
Goodwill and intangible assets, net (Note 10). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,337
Goodwill and intangible assets, net (Note 10) 5,337
Equipment on operating leases, net (Note 7; Note 11 at VIEs). . . . . . . . . . . . . . . . . . . . . . . . . . . . .
42,055
Equipment on operating leases, net (Note 7; Note 11 at VIEs) 42,055
24,640
Deferred income taxes (Note 17) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes (Note 17) 24,640
Other assets (Note 4; Note 11 at VIEs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,346
Other assets (Note 4; Note 11 at VIEs) 7,346
153,045
Total non-current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total non-current assets 153,045
Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
228,037
Total Assets $ 228,037
LIABILITIES AND EQUITY
LIABILITIES AND EQUITY
25,083
25,083
9,215
9,215
38,758
38,758
5,579
5,579
43,559
43,559
24,082
24,082
5,770
5,770
152,046
152,046
$
227,339
$ 227,339
Current Liabilities
Current Liabilities
Accounts payable (principally trade). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Accounts payable (principally trade)
Short-term debt and current portion of long-term debt (Note 13). . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt and current portion of long-term debt (Note 13)
1,897
Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,897
Automotive
35,503
GM Financial (Note 11 at VIEs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
35,503
GM Financial (Note 11 at VIEs)
Accrued liabilities (Note 12) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,487
26,487
Accrued liabilities (Note 12)
84,905
Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities 84,905
21,018
$ 21,018
Non-current Liabilities
Non-current Liabffities
Long-term debt (Note 13)
Long-term debt (Note 13)
Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12,489
Automotive 12,489
GM Financial (Note 11 at VIEs) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53,435
GM Financial (Note 11 at VIEs) 53,435
Postretirement benefits other than pensions (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,935
Postretirement benefits other than pensions (Note 15) 5,935
Pensions (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12,170
Pensions (Note 15) 12,170
Other liabilities (Note 12) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13,146
Other liabilities (Note 12) 13,146
Total non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
97,175
Total non-current liabilities 97,175
Total Liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
182,080
Total Liabilities 182,080
Commitments and contingencies (Note 16)
Commitments and contingencies (Note 16)
Equity (Note 20)
Equity (Note 20)
Common stock, $0.01 par value. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
Common stock, $0.01 par value 14
Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,074
Additional paid-in capital 26,074
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,860
Retained earnings 26,860
Accumulated other comprehensive loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(11,156)
)
(
Accumulated other comprehensive loss (11,156)
41,792
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total stockholders' equity 41,792
Noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4,165
Noncontrolling interests 4,165
Total Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
45,957
Total Equity 45,957
Total Liabilities and Equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
228,037
Total Liabilities and Equity $ 228,037
$
22,297
$ 22,297
935
935
30,956
30,956
28,049
28,049
82,237
82,237
13,028
13,028
60,032
60,032
5,370
5,370
11,538
11,538
12,357
12,357
102,325
102,325
184,562
184,562
14
14
25,563
25,563
22,322
22,322
(9,039)
)
(
(9,039)
38,860
38,860
3,917
3,917
42,777
42,777
$
227,339
$ 227,339
Reference should be made to the notes to consolidated financial statements.
Reference should be made to the notes to consolidated fmancial statements.
48
48
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(In millions)
Years Ended December 31,
Years Ended December 31,
2018
2018
2019
2019
2017
2017
Cash flows from operating activities
Cash flows from operating activities
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
6,667
Income from continuing operations $ 6,667
Depreciation and impairment of Equipment on operating leases, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,332
Depreciation and impairment of Equipment on operating leases, net 7,332
Depreciation, amortization and impairment charges on Property, net. . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,786
Depreciation, amortization and impairment charges on Property, net 6,786
Foreign currency remeasurement and transaction (gains) losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(85)
Foreign currency remeasurement and transaction (gains) losses (85)
585
Undistributed earnings of nonconsolidated affiliates, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Undistributed earnings of nonconsolidated affiliates, net 585
Pension contributions and OPEB payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(985)
Pension contributions and OPEB payments (985)
Pension and OPEB income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(484)
Pension and OPEB income, net (484)
Provision (benefit) for deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(133)
Provision (benefit) for deferred taxes (133)
(3,789)
Change in other operating assets and liabilities (Note 26) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in other operating assets and liabilities (Note 26) (3,789)
Other operating activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(873)
Other operating activities (873)
Net cash provided by operating activities – continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15,021
Net cash provided by operating activities - continuing operations 15,021
—
Net cash used in operating activities – discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in operating activities - discontinued operations
Net cash provided by operating activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15,021
Net cash provided by operating activities 15,021
Cash flows from investing activities
Cash flows from investing activities
Expenditures for property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7,592)
Expenditures for property (7,592)
Available-for-sale marketable securities, acquisitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4,075)
Available-for-sale marketable securities, acquisitions (4,075)
Available-for-sale marketable securities, liquidations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,265
Available-for-sale marketable securities, liquidations 6,265
(24,538)
Purchases of finance receivables, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchases of finance receivables, net (24,538)
22,005
Principal collections and recoveries on finance receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Principal collections and recoveries on finance receivables 22,005
Purchases of leased vehicles, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(16,404)
Purchases of leased vehicles, net (16,404)
Proceeds from termination of leased vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13,302
Proceeds from termination of leased vehicles 13,302
Other investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
138
Other investing activities 138
(10,899)
Net cash used in investing activities – continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in investing activities - continuing operations (10,899)
Net cash provided by (used in) investing activities – discontinued operations (Note 22). . . . . . . . . . . . .
—
Net cash provided by (used in) investing activities - discontinued operations (Note 22)
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash used in investing activities (10,899)
(10,899)
Cash flows from financing activities
Cash flows from financing activities
8,075
$
$ 8,075
7,604
7,604
6,065
6,065
168
168
(141)
(141)
(2,069)
(2,069)
(1,280)
(1,280)
(112)
(112)
(1,376)
(1,376)
(1,678)
(1,678)
15,256
15.256
—
15,256
15,256
330
$
$ 330
6,805
6,805
5,456
5,456
52
52
(132)
(132)
(1,636)
(1,636)
(934)
(934)
10,880
10,880
(3,015)
(3,015)
(468)
(468)
17,338
17,338
(10)
(10)
17,328
17,328
(8,761)
(8,761)
(2,820)
(2,820)
5,108
5,108
(25,671)
(25,671)
17,048
17,048
(16,736)
(16,736)
10,864
10,864
39
39
(20,929)
(20,929)
166
166
(20,763)
(20,763)
(8,453)
(8,453)
(5,503)
(5,503)
9,007
9,007
(19,325)
(19,325)
12,578
12,578
(19,180)
(19,180)
6,667
6,667
137
137
(24,072)
(24,072)
(3,500)
(3,500)
(27,572)
(27,572)
1,186
Net increase (decrease) in short-term debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(312)
1,186
Net increase (decrease) in short-term debt (312)
43,801
36,937
Proceeds from issuance of debt (original maturities greater than three months). . . . . . . . . . . . . . . . . . . .
43,801
Proceeds from issuance of debt (original maturities greater than three months) 36,937
Payments on debt (original maturities greater than three months) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(33,323)
(39,156)
(33,323)
Payments on debt (original maturities greater than three months) (39,156)
(190)
Payments to purchase common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
Payments to purchase common stock (190)
2,862
Proceeds from issuance of subsidiary preferred and common stock (Note 20). . . . . . . . . . . . . . . . . . . . .
457
2,862
Proceeds from issuance of subsidiary preferred and common stock (Note 20) 457
(2,242)
(2,350)
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,242)
Dividends paid (2,350)
(640)
Other financing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(253)
(640)
Other financing activities (253)
Net cash provided by financing activities – continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,454
(4,677)
11,454
Net cash provided by financing activities - continuing operations (4,677)
—
—
Net cash provided by financing activities – discontinued operations . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash provided by financing activities - discontinued operations
Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11,454
(4,677)
11,454
Net cash provided by (used in) financing activities (4,677)
(299)
2
Effect of exchange rate changes on cash, cash equivalents and restricted cash . . . . . . . . . . . . . . . . . . . .
(299)
Effect of exchange rate changes on cash, cash equivalents and restricted cash 2
5,648
Net increase (decrease) in cash, cash equivalents and restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . .
(553)
5,648
Net increase (decrease) in cash, cash equivalents and restricted cash (553)
Cash, cash equivalents and restricted cash at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17,848
23,496
17,848
Cash, cash equivalents and restricted cash at beginning of period 23,496
Cash, cash equivalents and restricted cash at end of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
$
23,496
22,943
Cash, cash equivalents and restricted cash at end of period $ 22,943
$ 23,496
(140)
(140)
52,187
52,187
(33,592)
(33,592)
(4,492)
(4,492)
985
985
(2,233)
(2,233)
(305)
(305)
12,410
12,410
174
174
12,584
12,584
348
348
2,688
2,688
15,160
15,160
17,848
$
$ 17,848
22,943
Cash, cash equivalents and restricted cash – continuing operations at end of period (Note 4) . . . . . . . . . . $
Cash, cash equivalents and restricted cash - continuing operations at end of period (Note 4) $ 22,943
Significant Non-cash Investing and Financing Activity
Significant Non-cash Investing and Financing Activity
Non-cash property additions – continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
$
3,996
2,837
$ 1996
Non-cash property additions - continuing operations $ 2,837
808
— $
Non-cash proceeds on sale of discontinued operations (Note 22) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Non-cash proceeds on sale of discontinued operations (Note 22) $ - $ - $ 808
$
3,813
$ 3,813
— $
$
17,848
$ 17.848
$
23,496
$ 23,496
Reference should be made to the notes to consolidated financial statements.
Reference should be made to the notes to consolidated fmancial statements.
49
49
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EQUITY
CONSOLIDATED STATEMENTS OF EQUITY
(In millions)
(In millions)
Common Stockholders’
Common Stockholders'
Common
Common
Stock
Stock
Additional
Additional
Retained
Paid-in
Retained
Paid -in
Capital
Earnings
Earnings
Capital
Balance at January 1, 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . $
15
$26,168
$ 26,983
$ 26,983 $26,168
Balance at January 1, 2017 $ 15
— (3,864)
—
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3,864)
Net loss —
—
—
—
Other comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive income
Purchase of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,428)
(2,063)
(1)
(2,428)
(2,063)
Purchase of common stock (1)
Exercise of common stock warrants . . . . . . . . . . . . . . . . . . . . .
—
43
—
Exercise of common stock warrants 43
—
—
—
Issuance of subsidiary preferred stock (Note 20) . . . . . . . . . . .
Issuance of subsidiary preferred stock (Note 20)
(34)
Stock based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
468
—
(34)
Stock based compensation 468
Cash dividends paid on common stock. . . . . . . . . . . . . . . . . . .
— (2,215)
—
(2,215)
Cash dividends paid on common stock —
Dividends to noncontrolling interests . . . . . . . . . . . . . . . . . . . .
—
—
—
Dividends to noncontrolling interests
—
(60)
—
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other (60)
Balance at December 31, 2017 . . . . . . . . . . . . . . . . . . . . . . . .
17,627
25,371
14
17,627
25,371
Balance at December 31, 2017 14
Adoption of accounting standards. . . . . . . . . . . . . . . . . . . . . . .
— (1,046)
—
Adoption of accounting standards (1,046)
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,014
—
—
Net income 8,014
—
—
—
Other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other comprehensive loss
Purchase of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
(99)
(91)
(99)
Purchase of common stock (91)
Issuance of subsidiary preferred and common stock (Note 20)
—
—
—
Issuance of subsidiary preferred and common stock (Note 20)
—
Stock based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
287
—
Stock based compensation 287
— (2,144)
—
Cash dividends paid on common stock. . . . . . . . . . . . . . . . . . .
(2,144)
Cash dividends paid on common stock —
—
Dividends to noncontrolling interests . . . . . . . . . . . . . . . . . . . .
—
—
Dividends to noncontrolling interests
(30)
(4)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
(30)
Other (4)
Balance at December 31, 2018 . . . . . . . . . . . . . . . . . . . . . . . .
22,322
25,563
14
22,322
25,563
Balance at December 31, 2018 14
6,732
—
—
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,732
Net income —
Other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
—
—
Other comprehensive loss
—
Issuance of subsidiary preferred stock (Note 20) . . . . . . . . . . .
—
—
Issuance of subsidiary preferred stock (Note 20)
409
—
Stock based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(34)
(34)
Stock based compensation 409
— (2,165)
—
Cash dividends paid on common stock. . . . . . . . . . . . . . . . . . .
(2,165)
Cash dividends paid on common stock —
—
Dividends to noncontrolling interests . . . . . . . . . . . . . . . . . . . .
—
—
Dividends to noncontrolling interests
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
102
—
5
Other 102
Balance at December 31, 2019 . . . . . . . . . . . . . . . . . . . . . . . . $
$ 26,074
$26,860
14
$ 26,074 $26,860
Balance at December 31, 2019 $ 14
Accumulated
Accumulated
Other
Other
Comprehensive
Comprehensive
Loss
Loss
Noncontrolling
Noncontrolling
Interests
Interests
239
$
$ (9,330) $ 239
(18)
(18)
(2)
(2)
—
—
985
985
—
—
(18)
(18)
13
13
1,199
1,199
—
(9)
(9)
(6)
(6)
—
2,862
2,862
—
—
(169)
(169)
40
40
3,917
3,917
(65)
(65)
(11)
(11)
457
457
—
—
(166)
(166)
33
33
$
4,165
$ (11,156) $ 4,165
(9,330) $
—
1,319
1,319
—
—
—
—
—
—
—
(8,011)
(8,011)
(98)
(98)
—
(930)
(930)
—
—
—
—
—
—
(9,039)
(9,039)
—
(2,117)
(2,117)
—
—
—
—
—
(11,156) $
Total Equity
Total Equity
44,075
$
$ 44,075
(3,882)
(3,882)
1,317
1,317
(4,492)
(4,492)
43
43
985
985
434
434
(2,215)
(2,215)
(18)
(18)
(47)
(47)
36,200
36,200
(1,144)
(1,144)
8,005
8,005
(936)
(936)
(190)
(190)
2,862
2,862
287
287
(2,144)
(2,144)
(169)
(169)
6
6
42,777
42,777
6,667
6,667
(2,128)
(2,128)
457
457
375
375
(2,165)
(2,165)
(166)
(166)
140
140
45,957
$
$ 45,957
Reference should be made to the notes to consolidated financial statements.
Reference should be made to the notes to consolidated financial statements.
50
50
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Nature of Operations and Basis of Presentation
Note 1. Nature of Operations and Basis of Presentation
General Motors Company was incorporated as a Delaware corporation in 2009. We design, build and sell trucks, crossovers,
General Motors Company was incorporated as a Delaware corporation in 2009. We design, build and sell trucks, crossovers,
cars and automobile parts worldwide and are investing in and growing an autonomous vehicle business. We also provide automotive
cars and automobile parts worldwide and are investing in and growing an autonomous vehicle business. We also provide automotive
financing services through GM Financial. We analyze the results of our continuing operations through the following operating
financing services through GM Financial. We analyze the results of our continuing operations through the following operating
segments: GMNA, GM International Operations (GMIO), GM South America (GMSA), Cruise and GM Financial. Our GMSA
segments: GMNA, GM International Operations (GMIO), GM South America (GMSA), Cruise and GM Financial. Our GMSA
and GMIO operating segments are reported as one, combined international segment, GMI. Cruise, formerly GM Cruise, is our
and GMIO operating segments are reported as one, combined international segment, GMI. Cruise, formerly GM Cruise, is our
global segment responsible for the development and commercialization of autonomous vehicle technology. Nonsegment operations
global segment responsible for the development and commercialization of autonomous vehicle technology. Nonsegment operations
and Maven, our ride- and car-sharing business, are classified as Corporate. Corporate includes certain centrally recorded income
and Maven, our ride- and car-sharing business, are classified as Corporate. Corporate includes certain centrally recorded income
and costs such as interest, income taxes, corporate expenditures and certain nonsegment-specific revenues and expenses.
and costs such as interest, income taxes, corporate expenditures and certain nonsegment-specific revenues and expenses.
On July 31, 2017 we closed the sale of the Opel/Vauxhall Business to PSA Group. On October 31, 2017 we closed the sale of
On July 31, 2017 we closed the sale of the Opel/Vauxhall Business to PSA Group. On October 31, 2017 we closed the sale of
the Fincos to Banque PSA Finance S.A. and BNP Paribas Personal Finance S.A. The European Business is presented as discontinued
the Fincos to Banque PSAFinance S.A. and BNP Paribas Personal Finance S.A. The European Business is presented as discontinued
operations in our consolidated financial statements for all periods presented. Unless otherwise indicated, information in this report
operations in our consolidated fmancial statements for all periods presented. Unless otherwise indicated, information in this report
relates to our continuing operations. Refer to Note 22 for additional information on our discontinued operations.
relates to our continuing operations. Refer to Note 22 for additional information on our discontinued operations.
In 2019 we changed the presentation of our consolidated balance sheets to reclassify the current portion of Equipment on operating
In 2019 we changed the presentation of our consolidated balance sheets to reclassify the current portion of Equipment on operating
leases, net to Other current assets. We have made corresponding reclassifications to the comparable information for all periods
leases, net to Other current assets. We have made corresponding reclassifications to the comparable information for all periods
presented.
presented.
Principles of Consolidation The consolidated financial statements are prepared in conformity with U.S. GAAP. All intercompany
Principles of Consolidation The consolidated fmancial statements are prepared in conformity with U.S. GAAP. All intercompany
balances and transactions have been eliminated in consolidation. Except for per share amounts or as otherwise specified, amounts
balances and transactions have been eliminated in consolidation. Except for per share amounts or as otherwise specified, amounts
presented within tables are stated in millions.
presented within tables are stated in millions.
We consolidate entities that we control due to ownership of a majority voting interest and we consolidate variable interest entities
We consolidate entities that we control due to ownership of a majority voting interest and we consolidate variable interest entities
(VIEs) when we are the primary beneficiary. Our share of earnings or losses of nonconsolidated affiliates is included in our
(V1Es) when we are the primary beneficiary. Our share of earnings or losses of nonconsolidated affiliates is included in our
consolidated operating results using the equity method of accounting when we are able to exercise significant influence over the
consolidated operating results using the equity method of accounting when we are able to exercise significant influence over the
operating and financial decisions of the affiliate.
operating and fmancial decisions of the affiliate.
Use of Estimates in the Preparation of the Financial Statements Accounting estimates are an integral part of the consolidated
Use of Estimates in the Preparation of the Financial Statements Accounting estimates are an integral part of the consolidated
financial statements. These estimates require the use of judgments and assumptions that affect the reported amounts of assets and
financial statements. These estimates require the use of judgments and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of
liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses in the periods presented. We believe that the accounting estimates employed are appropriate and the resulting
revenues and expenses in the periods presented. We believe that the accounting estimates employed are appropriate and the resulting
balances are reasonable; however, due to the inherent uncertainties in making estimates, actual results could differ from the original
balances are reasonable; however, due to the inherent uncertainties in making estimates, actual results could differ from the original
estimates, requiring adjustments to these balances in future periods.
estimates, requiring adjustments to these balances in future periods.
a
GM Financial The amounts presented for GM Financial have been adjusted to include the effect of our tax attributes on GM
GM Financial The amounts presented for GM Financial have been adjusted to include the effect of our tax attributes on GM
Financial's deferred tax positions and provision for income taxes, which are not applicable to GM Financial on a stand-alone basis,
Financial's deferred tax positions and provision for income taxes, which are not applicable to GM Financial on a stand-alone basis,
and to eliminate the effect of transactions between GM Financial and the other members of the consolidated group. Accordingly,
and to eliminate the effect of transactions between GM Financial and the other members of the consolidated group. Accordingly,
the amounts presented will differ from those presented by GM Financial on a stand-alone basis.
the amounts presented will differ from those presented by GM Financial on a stand-alone basis.
Note 2. Significant Accounting Policies
Note 2. Significant Accounting Policies
The accounting policies that follow are utilized by our automotive, automotive financing and Cruise operations, unless otherwise
The accounting policies that follow are utilized by our automotive, automotive financing. and Cruise operations, unless otherwise
indicated.
indicated.
Revenue Recognition We adopted Accounting Standards Update (ASU) 2014-09 "Revenue from Contracts with Customers" on
Revenue Recognition We adopted Accounting Standards Update (ASU) 2014-09 "Revenue from Contracts with Customers" on
January 1, 2018, which requires us to recognize revenue when a customer obtains control rather than when we have transferred
January 1, 2018, which requires us to recognize revenue when a customer obtains control rather than when we have transferred
substantially all risks and rewards of a good or service, by applying the modified retrospective method to all noncompleted contracts
substantially all risks and rewards of a good or service, by applying the modified retrospective method to all noncompleted contracts
as of the date of adoption. The comparative information has not been restated and continues to be reported under the accounting
as of the date of adoption. The comparative information has not been restated and continues to be reported under the accounting
standards in effect for those periods. The following accounting policies became effective on January 1, 2018:
standards in effect for those periods. The following accounting policies became effective on January 1, 2018:
Automotive Automotive net sales and revenue represents the amount of consideration to which we expect to be entitled in
Automotive Automotive net sales and revenue represents the amount of consideration to which we expect to be entitled in
exchange for vehicle, parts and accessories and services and other sales. The consideration recognized represents the amount
exchange for vehicle, parts and accessories and services and other sales. The consideration recognized represents the amount
received, typically shortly after the sale to a customer, net of estimated dealer and customer sales incentives we reasonably expect
received, typically shortly after the sale to a customer, net of estimated dealer and customer sales incentives we reasonably expect
to pay. Significant factors in determining our estimates of incentives include forecasted sales volume, product mix, and the rate
to pay. Significant factors in determining our estimates of incentives include forecasted sales volume, product mix, and the rate
of customer acceptance of incentive programs, all of which are estimated based on historical experience and assumptions concerning
of customer acceptance of incentive programs, all ofwhich are estimated based on historical experience and assumptions concerning
51
51
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
future customer behavior and market conditions. Subsequent adjustments to incentive estimates are possible as facts and
future customer behavior and market conditions. Subsequent adjustments to incentive estimates are possible as facts and
circumstances change over time. A portion of the consideration received is deferred for separate performance obligations, such as
circumstances change over time. A portion of the consideration received is deferred for separate performance obligations, such as
maintenance and vehicle connectivity, that will be provided to our customers at a future date. Taxes assessed by various government
maintenance and vehicle connectivity, that will be provided to our customers at a future date. Taxes assessed by various government
entities, such as sales, use and value-added taxes, collected at the time of the vehicle sale are excluded from Automotive net sales
entities, such as sales, use and value-added taxes, collected at the time of the vehicle sale are excluded from Automotive net sales
and revenue. Costs for shipping and handling activities that occur after control of the vehicle transfers to the dealer are recognized
and revenue. Costs for shipping and handling activities that occur after control of the vehicle transfers to the dealer are recognized
at the time of sale and presented in Automotive and other cost of sales.
at the time of sale and presented in Automotive and other cost of sales.
VeVV hicle, Parts and Accessories For the majority of vehicle and accessories sales our customers obtain control and we recognize
Vehicle, Parts and Accessories For the majority of vehicle and accessories sales our customers obtain control and we recognize
revenue when the vehicle transfers to the dealer, which generally occurs when the vehicle is released to the carrier responsible for
revenue when the vehicle transfers to the dealer, which generally occurs when the vehicle is released to the carrier responsible for
transporting it to a dealer. Revenue, net of estimated returns, is recognized on the sale of parts upon delivery to the customer. When
transporting it to a dealer. Revenue, net of estimated returns, is recognized on the sale of parts upon delivery to the customer. When
our customers have a right to return eligible parts and accessories, we consider the returns in our estimation of the transaction
our customers have a right to return eligible parts and accessories, we consider the returns in our estimation of the transaction
price.
price.
Certain transfers to daily rental companies are accounted for as sales, with revenue recognized at the time of transfer. At the
Certain transfers to daily rental companies are accounted for as sales, with revenue recognized at the time of transfer. At the
time of transfer, we defer revenue for remarketing obligations, record a residual value guarantee and reflect a deposit liability for
time of transfer, we defer revenue for remarketing obligations, record a residual value guarantee and reflect a deposit liability for
amounts expected to be returned once the remarketing services are complete. Deferred revenue is recognized in earnings upon
amounts expected to be returned once the remarketing services are complete. Deferred revenue is recognized in earnings upon
completion of the remarketing service. Transfers that occurred prior to January 1, 2018 and future transfers containing a substantive
completion of the remarketing service. Transfers that occurred prior to January 1,2018 and future transfers containing a substantive
repurchase obligation are accounted for as operating leases and rental income is recognized over the estimated term of the lease.
repurchase obligation are accounted for as operating leases and rental income is recognized over the estimated term of the lease.
Our total exposure to vehicle repurchase obligations would be reduced to the extent vehicles are able to be resold to a third party.
Our total exposure to vehicle repurchase obligations would be reduced to the extent vehicles are able to be resold to a third party.
Used Vehicles Proceeds from the auction of vehicles returned from daily rental car companies and vehicles utilized by our
Used Vehicles Proceeds from the auction of vehicles returned from daily rental car companies and vehicles utilized by our
employees are recognized in Automotive net sales and revenue upon transfer of control of the vehicle to the customer and the
employees are recognized in Automotive net sales and revenue upon transfer of control of the vehicle to the customer and the
related vehicle carrying value is recognized in Automotive and other cost of sales.
related vehicle carrying value is recognized in Automotive and other cost of sales.
r
Services and Other Services and other revenue primarily consists of revenue from vehicle-related service arrangements and
Services and Other Services and other revenue primarily consists of revenue from vehicle-related service arrangements and
after-sale services such as maintenance, vehicle connectivity and extended service warranties. For those service arrangements that
after-sale services such as maintenance, vehicle connectivity and extended service warranties. For those service arrangements that
are bundled with a vehicle sale, a portion of the revenue from the sale is allocated to the service component and recognized as
are bundled with a vehicle sale, a portion of the revenue from the sale is allocated to the service component and recognized as
deferred revenue within Accrued liabilities or Other liabilities. We recognize revenue for bundled services and services sold
deferred revenue within Accrued liabilities or Other liabilities. We recognize revenue for bundled services and services sold
separately as services are performed, typically over a period of less than three years.
separately as services are performed, typically over a period of less than three years.
t
Automotive Financing - GM Financial Finance charge income earned on receivables is recognized using the effective interest
Automotive Financing - GM Financial Finance charge income earned on receivables is recognized using the effective interest
method. Fees and commissions (including incentive payments) received and direct costs of originating loans are deferred and
method. Fees and commissions (including incentive payments) received and direct costs of originating loans are deferred and
amortized over the term of the related finance receivables using the effective interest method and are removed from the consolidated
amortized over the term of the related finance receivables using the effective interest method and are removed from the consolidated
balance sheets when the related finance receivables are fully charged off or paid in full. Accrual of finance charge income on retail
balance sheets when the related fmance receivables are fully charged off or paid in full. Accrual of fmance charge income on retail
finance receivables is generally suspended on accounts that are more than 60 days delinquent, accounts in bankruptcy and accounts
finance receivables is generally suspended on accounts that are more than 60 days delinquent, accounts in bankruptcy and accounts
in repossession. Payments received on nonaccrual loans are first applied to any fees due, then to any interest due and then any
in repossession. Payments received on nonaccrual loans are first applied to any fees due, then to any interest due and then any
remaining amounts are applied to principal. Interest accrual generally resumes once an account has received payments bringing
remaining amounts are applied to principal. Interest accrual generally resumes once an account has received payments bringing
the delinquency to less than 60 days past due. Accrual of finance charge income on commercial finance receivables is generally
the delinquency to less than 60 days past due. Accrual of finance charge income on commercial fmance receivables is generally
suspended on accounts that are more than 90 days delinquent, upon receipt of a bankruptcy notice from a borrower, or where
suspended on accounts that are more than 90 days delinquent, upon receipt of a bankruptcy notice from a borrower, or where
reasonable doubt exists about the full collectability of contractually agreed upon principal and interest. Payments received on
reasonable doubt exists about the full collectability of contractually agreed upon principal and interest. Payments received on
nonaccrual loans are first applied to principal. Interest accrual resumes once an account has received payments bringing the account
nonaccrual loans are first applied to principal. Interest accrual resumes once an account has received payments bringing the account
fully current and collection of contractual principal and interest is reasonably assured (including amounts previously charged off).
fully current and collection of contractual principal and interest is reasonably assured (including amounts previously charged off).
Income from operating lease assets, which includes lease origination fees, net of lease origination costs, is recorded as operating
Income from operating lease assets, which includes lease origination fees, net of lease origination costs, is recorded as operating
lease revenue on a straight-line basis over the term of the lease agreement.
lease revenue on a straight-line basis over the term of the lease agreement.
Advertising and Promotion Expenditures Advertising and promotion expenditures, which are expensed as incurred in
Advertising and Promotion Expenditures Advertising and promotion expenditures, which are expensed as incurred in
Automotive and other selling, general and administrative expense, were $3.7 billion, $4.0 billion and $4.3 billion in the years
Automotive and other selling, general and administrative expense, were $3.7 billion, $4.0 billion and $4.3 billion in the years
ended December 31, 2019, 2018 and 2017.
ended December 31, 2019, 2018 and 2017.
Research and Development Expenditures Research and development expenditures, which are expensed as incurred in
Research and Development Expenditures Research and development expenditures, which are expensed as incurred in
Automotive and other cost of sales, were $6.8 billion, $7.8 billion and $7.3 billion in the years ended December 31, 2019, 2018
Automotive and other cost of sales, were $6.8 billion, $7.8 billion and $7.3 billion in the years ended December 31, 2019, 2018
and 2017. We enter into cost sharing arrangements with third parties or nonconsolidated affiliates for product-related research,
and 2017. We enter into cost sharing arrangements with third parties or nonconsolidated affiliates for product-related research,
engineering, design and development activities. Cost sharing payments and fees related to these arrangements are presented in
engineering, design and development activities. Cost sharing payments and fees related to these arrangements are presented in
Automotive and other cost of sales.
Automotive and other cost of sales.
52
52
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Cash Equivalents and Restricted Cash Cash equivalents are defined as short-term, highly-liquid investments with original
Cash Equivalents and Restricted Cash Cash equivalents are defmed as short-term, highly-liquid investments with original
maturities of 90 days or less. We are required to post cash as collateral as part of certain agreements that we enter into as part of
maturities of 90 days or less. We are required to post cash as collateral as part of certain agreements that we enter into as part of
our operations. Cash and cash equivalents subject to contractual restrictions and not readily available are classified as restricted
our operations. Cash and cash equivalents subject to contractual restrictions and not readily available are classified as restricted
cash. Restricted cash is invested in accordance with the terms of the underlying agreements and include amounts related to various
cash. Restricted cash is invested in accordance with the terms of the underlying agreements and include amounts related to various
deposits, escrows and other cash collateral. Restricted cash is included in Other current assets and Other assets in the consolidated
deposits, escrows and other cash collateral. Restricted cash is included in Other current assets and Other assets in the consolidated
balance sheets.
balance sheets.
Fair Value Measurements A three-level valuation hierarchy, based upon observable and unobservable inputs, is used for fair
Fair Value Measurements A three-level valuation hierarchy, based upon observable and unobservable inputs, is used for fair
value measurements. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect
value measurements. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect
market assumptions based on the best evidence available. These two types of inputs create the following fair value hierarchy:
market assumptions based on the best evidence available. These two types of inputs create the following fair value hierarchy:
Level 1 – Quoted prices for identical instruments in active markets; Level 2 – Quoted prices for similar instruments in active
Level 1 — Quoted prices for identical instruments in active markets; Level 2 — Quoted prices for similar instruments in active
markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations whose
markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations whose
significant inputs are observable; and Level 3 – Instruments whose significant inputs are unobservable.
significant inputs are observable; and Level 3 — Instruments whose significant inputs are unobservable.
Marketable Debt Securities We classify marketable debt securities as either available-for-sale or trading. Various factors,
Marketable Debt Securities We classify marketable debt securities as either available-for-sale or trading. Various factors,
including turnover of holdings and investment guidelines, are considered in determining the classification of securities. Available-
including turnover of holdings and investment guidelines, are considered in determining the classification of securities. Available-
for-sale debt securities are recorded at fair value with unrealized gains and losses recorded net of related income taxes in Accumulated
for-sale debt securities are recorded at fair value with unrealized gains and losses recorded net ofrelated income taxes in Accumulated
other comprehensive loss until realized. Trading debt securities are recorded at fair value with changes in fair value recorded ind
other comprehensive loss until realized. Trading debt securities are recorded at fair value with changes in fair value recorded in
Interest income and other non-operating income, net. We determine realized gains and losses for all debt securities using the specific
Interest income and other non-operating income, net. We determine realized gains and losses for all debt securities using the specific
identification method.
identification method.
We measure the fair value of our marketable debt securities using a market approach where identical or comparable prices are
We measure the fair value of our marketable debt securities using a market approach where identical or comparable prices are
available and an income approach in other cases. If quoted market prices are not available, fair values of securities are determined
available and an income approach in other cases. If quoted market prices are not available, fair values of securities are determined
using prices from a pricing service, pricing models, quoted prices of securities with similar characteristics or discounted cash flow
using prices from a pricing service, pricing models, quoted prices of securities with similar characteristics or discounted cash flow
models. These prices represent non-binding quotes. Our pricing service utilizes industry-standard pricing models that consider
models. These prices represent non-binding quotes. Our pricing service utilizes industry-standard pricing models that consider
various inputs. We conduct an annual review of our pricing service and believe the prices received from our pricing service are a
various inputs. We conduct an annual review of our pricing service and believe the prices received from our pricing service are a
reliable representation of exit prices.
reliable representation of exit prices.
rr
An evaluation is made quarterly to determine if unrealized losses related to non-trading investments in debt securities are other-
An evaluation is made quarterly to determine if unrealized losses related to non-trading investments in debt securities are other-
than-temporary. Factors considered include the length of time and extent to which the fair value has been below cost, the financial
than-temporary. Factors considered include the length of time and extent to which the fair value has been below cost, the financial
condition and near-term prospects of the issuer and the intent to sell or likelihood to be forced to sell the debt security before any
condition and near-term prospects of the issuer and the intent to sell or likelihood to be forced to sell the debt security before any
anticipated recovery.
anticipated recovery.
ff
Accounts and Notes Receivable Accounts and notes receivable primarily consists of amounts that are due and payable from our
Accounts and Notes Receivable Accounts and notes receivable primarily consists of amounts that are due and payable from our
customers for the sale of vehicles, parts, and accessories. We evaluate the collectability of receivables each reporting period and
customers for the sale of vehicles, parts, and accessories. We evaluate the collectability of receivables each reporting period and
record an allowance for doubtful accounts representing our estimate of probable losses. Additions to the allowance are charged to
record an allowance for doubtful accounts representing our estimate of probable losses. Additions to the allowance are charged to
bad debt expense reported in Automotive and other selling, general and administrative expense and were insignificant in the yearsaa
bad debt expense reported in Automotive and other selling, general and administrative expense and were insignificant in the years
ended December 31, 2019, 2018 and 2017.
ended December 31, 2019, 2018 and 2017.
d
GM Financial Receivables Finance receivables are carried at amortized cost, net of allowance for loan losses. GM Financial
GM Financial Receivables Finance receivables are carried at amortized cost, net of allowance for loan losses. GM Financial
uses forecasting models to determine the collective allowance for loan losses based on factors including historical delinquency
uses forecasting models to determine the collective allowance for loan losses based on factors including historical delinquency
migration to loss, probability of default and loss given default. The loss confirmation period is a key assumption within the models
migration to loss, probability of default and loss given default. The loss confirmation period is a key assumption within the models
and represents the average amount of time from when a loss event first occurs to when the receivable is charged off. GM Financial
and represents the average amount of time from when a loss event first occurs to when the receivable is charged off. GM Financial
also considers an evaluation of overall portfolio credit quality based on various indicators.
also considers an evaluation of overall portfolio credit quality based on various indicators.
Retail finance receivables that become classified as troubled debt restructurings (TDRs) are separately assessed for impairment.
Retail fmance receivables that become classified as troubled debt restructurings (TDRs) are separately assessed for impairment.
A specific allowance is estimated based on the present value of the expected future cash flows of the receivables discounted at the
A specific allowance is estimated based on the present value of the expected future cash flows of the receivables discounted at the
original weighted average effective interest rate. Finance charge income from loans classified as TDRs is accounted for in the
original weighted average effective interest rate. Finance charge income from loans classified as TDRs is accounted for in the
same manner as other accruing loans. Cash collections on these loans are allocated according to the same payment hierarchy
same manner as other accruing loans. Cash collections on these loans are allocated according to the same payment hierarchy
methodology applied to loans that are not classified as TDRs.
methodology applied to loans that are not classified as TDRs.
t
Retail finance receivables are generally charged off in the month in which the account becomes 120 days contractually delinquent
Retail fmance receivables are generally charged off in the month in which the account becomes 120 days contractually delinquent
if GM Financial has not yet recorded a repossession charge-off. A repossession charge-off generally represents the difference
if GM Financial has not yet recorded a repossession charge-off. A repossession charge-off generally represents the difference
between the estimated net sales proceeds and the unpaid balance of the contract, including accrued interest.
between the estimated net sales proceeds and the unpaid balance of the contract, including accrued interest.
53
53
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Inventories Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price
Inventories Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price
in the ordinary course of business less cost to sell, and considers general market and economic conditions, periodic reviews of
in the ordinary course of business less cost to sell, and considers general market and economic conditions, periodic reviews of
current profitability of vehicles, product warranty costs and the effect of estimated sales incentives. Net realizable value for off-
current profitability of vehicles, product warranty costs and the effect of estimated sales incentives. Net realizable value for off-
lease and other vehicles is current auction sales proceeds less disposal and warranty costs. Productive material, supplies, work in
lease and other vehicles is current auction sales proceeds less disposal and warranty costs. Productive material, supplies, work in
process and service parts are reviewed to determine if inventory quantities are in excess of forecasted usage or if they have become
process and service parts are reviewed to determine if inventory quantities are in excess of forecasted usage or if they have become
obsolete.
obsolete.
rr
Equipment on Operating Leases Equipment on operating leases, net consists of vehicle leases to retail customers with lease
Equipment on Operating Leases Equipment on operating leases, net consists of vehicle leases to retail customers with lease
terms of two to five years and vehicle sales to rental car companies that are expected to be repurchased in an average of seven
terms of two to five years and vehicle sales to rental car companies that are expected to be repurchased in an average of seven
months. We are exposed to changes in the residual values of these assets. The residual values represent estimates of the values of
months. We are exposed to changes in the residual values of these assets. The residual values represent estimates of the values of
the leased vehicles at the end of the lease contracts and are determined based on forecasted auction proceeds when there is a reliable
the leased vehicles at the end of the lease contracts and are determined based on forecasted auction proceeds when there is a reliable
basis to make such a determination. Realization of the residual values is dependent on the future ability to market the vehicles
basis to make such a determination. Realization of the residual values is dependent on the future ability to market the vehicles
under prevailing market conditions. The estimate of the residual value is evaluated over the life of the arrangement and adjustments
under prevailing market conditions. The estimate of the residual value is evaluated over the life of the arrangement and adjustments
may be made to the extent the expected value of the vehicle changes. Adjustments may be in the form of revisions to the depreciation
may be made to the extent the expected value of the vehicle changes. Adjustments may be in the form of revisions to the depreciation
rate or recognition of an impairment charge. A lease vehicle asset group is determined to be impaired if an impairment indicator
rate or recognition of an impairment charge. A lease vehicle asset group is determined to be impaired if an impairment indicator
exists and the expected future cash flows, which include estimated residual values, are lower than the carrying amount of the
exists and the expected future cash flows, which include estimated residual values, are lower than the carrying amount of the
vehicle asset group. If the carrying amount is considered impaired an impairment charge is recorded for the amount by which the
vehicle asset group. If the carrying amount is considered impaired an impairment charge is recorded for the amount by which the
carrying amount exceeds fair value of the vehicle asset group. Fair value is determined primarily using the anticipated cash flows,
carrying amount exceeds fair value of the vehicle asset group. Fair value is determined primarily using the anticipated cash flows,
including estimated residual values. In our automotive operations when a vehicle that is accounted for as a lease is returned thet
including estimated residual values. In our automotive operations when a vehicle that is accounted for as a lease is returned the
asset is reclassified from Equipment on operating leases, net to Inventories at the lower of cost or net realizable value. Upon
asset is reclassified from Equipment on operating leases, net to Inventories at the lower of cost or net realizable value. Upon
disposition, proceeds are recorded in Automotive net sales and revenue and costs are recorded in Automotive and other cost of
disposition, proceeds are recorded in Automotive net sales and revenue and costs are recorded in Automotive and other cost of
sales. In our automotive finance operations when a leased vehicle is returned or repossessed the asset is recorded in Other assets
sales. In our automotive finance operations when a leased vehicle is returned or repossessed the asset is recorded in Other assets
at the lower of amortized cost or net realizable value. Upon disposition a gain or loss is recorded in GM Financial interest, operating
at the lower of amortized cost or net realizable value. Upon disposition a gain or loss is recorded in GM Financial interest, operating
and other expenses for any difference between the net book value of the leased asset and the proceeds from the disposition of thet
and other expenses for any difference between the net book value of the leased asset and the proceeds from the disposition of the
asset.
asset.
tt
Equity Investments When events and circumstances warrant, equity investments accounted for under the equity method of
Equity Investments When events and circumstances warrant, equity investments accounted for under the equity method of
accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an equity investment
accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an equity investment
below its carrying amount is determined to be other-than-temporary. Impairment charges related to equity method investments are
below its carrying amount is determined to be other-than-temporary. Impairment charges related to equity method investments are
recorded in Equity income. Equity investments that are not accounted for under the equity method of accounting are measured at
recorded in Equity income. Equity investments that are not accounted for under the equity method of accounting are measured at
fair value with changes in fair value recorded in Interest income and other non-operating income, net.
fair value with changes in fair value recorded in Interest income and other non-operating income, net.
Property, net Property, plant and equipment, including internal use software, is recorded at cost. Major improvements that extend
Property, net Property, plant and equipment, including internal use software, is recorded at cost. Major improvements that extend
the useful life or add functionality are capitalized. The gross amount of assets under finance leases, prior to 2019, capital leases,
the useful life or add functionality are capitalized. The gross amount of assets under finance leases, prior to 2019, capital leases,
is included in property, plant and equipment. Expenditures for repairs and maintenance are charged to expense as incurred. We
is included in property, plant and equipment. Expenditures for repairs and maintenance are charged to expense as incurred. We
depreciate depreciable property using the straight-line method. Leasehold improvements are amortized over the period of lease or
depreciate depreciable property using the straight-line method. Leasehold improvements are amortized over the period of lease or
the life of the asset, whichever is shorter. The amortization of the assets under finance leases, prior to 2019, capital leases, is
the life of the asset, whichever is shorter. The amortization of the assets under finance leases, prior to 2019, capital leases, is
included in depreciation expense. Upon retirement or disposition of property, plant and equipment, the cost and related accumulated
included in depreciation expense. Upon retirement or disposition of property, plant and equipment, the cost and related accumulated
depreciation are eliminated and any resulting gain or loss is recorded in earnings. Impairment charges related to property are
depreciation are eliminated and any resulting gain or loss is recorded in earnings. Impairment charges related to property are
recorded in Automotive and other cost of sales, Automotive and other selling, general and administrative expense or GM Financial
recorded in Automotive and other cost of sales, Automotive and other selling, general and administrative expense or GM Financial
interest, operating and other expenses.
interest, operating and other expenses.
Special Tools Special tools represent product-specific propulsion and non-propulsion related tools, dies, molds and other items
Special Tools Special tools represent product-specific propulsion and non-propulsion related tools, dies, molds and other items
used in the vehicle manufacturing process. Expenditures for special tools are recorded at cost and are capitalized. We amortize
used in the vehicle manufacturing process. Expenditures for special tools are recorded at cost and are capitalized. We amortize
special tools over their estimated useful lives using the straight-line method or an accelerated amortization method based on their
special tools over their estimated useful lives using the straight-line method or an accelerated amortization method based on their
historical and estimated production volume. Impairment charges related to special tools are recorded in Automotive and other cost
historical and estimated production volume. Impairment charges related to special tools are recorded in Automotive and other cost
of sales.
of sales.
t
Goodwill Goodwill is not amortized but rather tested for impairment annually on October 1 or when events occur or circumstances
Goodwill Goodwill is not amortized but rather tested for impairment annually on October 1 or when events occur or circumstances
change that would trigger such a review. The impairment test entails an assessment of qualitative factors to determine whether it
change that would trigger such a review. The impairment test entails an assessment of qualitative factors to determine whether it
is more likely than not that an impairment exists. If it is more likely than not that an impairment exists, then a quantitative impairment
is more likely than not that an impairment exists. If it is more likely than not that an impairment exists, then a quantitative impairment
test is performed. Impairment exists when the carrying amount of a reporting unit exceeds its fair value.
test is performed. Impairment exists when the carrying amount of a reporting unit exceeds its fair value.
Intangible Assets, net Intangible assets, excluding goodwill, primarily include brand names, technology and intellectual property,
Intangible Assets, net Intangible assets, excluding goodwill, primarily include brand names, technology and intellectual property,
customer relationships and dealer networks. Intangible assets are amortized on a straight-line or an accelerated method of
customer relationships and dealer networks. Intangible assets are amortized on a straight-line or an accelerated method of
amortization over their estimated useful lives. An accelerated amortization method reflecting the pattern in which the asset will
amortization over their estimated useful lives. An accelerated amortization method reflecting the pattern in which the asset will
54
54
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
be consumed is utilized if that pattern can be reliably determined. We consider the period of expected cash flows and underlying
be consumed is utilized if that pattern can be reliably determined. We consider the period of expected cash flows and underlying
data used to measure the fair value of the intangible assets when selecting a useful life. Amortization of developed technology and
data used to measure the fair value of the intangible assets when selecting a useful life. Amortization of developed technology and
intellectual property is recorded in Automotive and other cost of sales. Amortization of brand names, customer relationships and
intellectual property is recorded in Automotive and other cost of sales. Amortization of brand names, customer relationships and
our dealer networks is recorded in Automotive and other selling, general and administrative expense or GM Financial interest,
our dealer networks is recorded in Automotive and other selling, general and administrative expense or GM Financial interest,
operating and other expenses. Impairment charges, if any, related to intangible assets are recorded in Automotive and other selling,
operating and other expenses. Impairment charges, if any, related to intangible assets are recorded in Automotive and other selling,
general and administrative expense or Automotive and other cost of sales.
general and administrative expense or Automotive and other cost of sales.
y
Valuation of Long-Lived Assets The carrying amount of long-lived assets and finite-lived intangible assets to be held and used
Valuation of Long-Lived Assets The carrying amount of long-lived assets and finite-lived intangible assets to be held and used
in the business is evaluated for impairment when events and circumstances warrant. If the carrying amount of a long-lived asset
in the business is evaluated for impairment when events and circumstances warrant. If the carrying amount of a long-lived asset
group is considered impaired, a loss is recorded based on the amount by which the carrying amount exceeds fair value. Product-
group is considered impaired, a loss is recorded based on the amount by which the carrying amount exceeds fair value. Product-
specific long-lived asset groups and non-product specific long-lived assets are separately tested for impairment on an asset group
specific long-lived asset groups and non-product specific long-lived assets are separately tested for impairment on an asset group
basis. Fair value is determined using either the market or sales comparison approach, cost approach or anticipated cash flows
basis. Fair value is determined using either the market or sales comparison approach, cost approach or anticipated cash flows
discounted at a rate commensurate with the risk involved. Long-lived assets to be disposed of other than by sale are considered
discounted at a rate commensurate with the risk involved. Long-lived assets to be disposed of other than by sale are considered
held for use until disposition.
held for use until disposition.
Pension and OPEB Plans
Pension and OPEB Plans
Attribution, Methods and Assumptions The cost of benefits provided by defined benefit pension plans is recorded in the period
Attribution, Methods and Assumptions The cost of benefits provided by defined benefit pension plans is recorded in the period
employees provide service. The cost of pension plan amendments that provide for benefits already earned by plan participants is
employees provide service. The cost of pension plan amendments that provide for benefits already earned by plan participants is
amortized over the expected period of benefit which may be the duration of the applicable collective bargaining agreement specific
amortized over the expected period of benefit which may be the duration of the applicable collective bargaining agreement specific
to the plan, the expected future working lifetime or the life expectancy of the plan participants.
to the plan, the expected future working lifetime or the life expectancy of the plan participants.
The cost of medical, dental, legal service and life insurance benefits provided through postretirement benefit plans is recorded
The cost of medical, dental, legal service and life insurance benefits provided through postretirement benefit plans is recorded
in the period employees provide service. The cost of postretirement plan amendments that provide for benefits already earned by
in the period employees provide service. The cost of postretirement plan amendments that provide for benefits already earned by
plan participants is amortized over the expected period of benefit which may be the average period to full eligibility or the average
plan participants is amortized over the expected period of benefit which may be the average period to full eligibility or the average
life expectancy of the plan participants.
life expectancy of the plan participants.
aa
An expected return on plan asset methodology is utilized to calculate future pension expense for certain significant funded
An expected return on plan asset methodology is utilized to calculate future pension expense for certain significant funded
benefit plans. A market-related value of plan assets methodology is also utilized that averages gains and losses on the plan assets
benefit plans. A market-related value of plan assets methodology is also utilized that averages gains and losses on the plan assets
over a period of years to determine future pension expense. The methodology recognizes 60% of the difference between the fair
over a period of years to determine future pension expense. The methodology recognizes 60% of the difference between the fair
value of assets and the expected calculated value in the first year and 10% of that difference over each of the next four years.
value of assets and the expected calculated value in the first year and 10% of that difference over each of the next four years.
The discount rate assumption is established for each of the retirement-related benefit plans at their respective measurement dates.
The discount rate assumption is established for each of the retirement-related benefit plans at their respective measurement dates.
In the U.S. we use a cash flow matching approach that uses projected cash flows matched to spot rates along a high-quality corporate
In the U.S. we use a cash flow matching approach that uses projected cash flows matched to spot rates along a high-quality corporate
bond yield curve to determine the present value of cash flows to calculate a single equivalent discount rate. We apply individual
bond yield curve to determine the present value of cash flows to calculate a single equivalent discount rate. We apply individual
annual yield curve rates to determine the service cost and interest cost for our pension and OPEB plans to more specifically link
annual yield curve rates to determine the service cost and interest cost for our pension and OPEB plans to more specifically link
the cash flows related to service cost and interest cost to bonds maturing in their year of payment.
the cash flows related to service cost and interest cost to bonds maturing in their year of payment.
The benefit obligation for pension plans in Canada, the U.K. and Germany represents 93% of the non-U.S. pension benefit
The benefit obligation for pension plans in Canada, the U.K. and Germany represents 93% of the non-U.S. pension benefit
obligation at December 31, 2019. The discount rates for plans in Canada, the U.K. and Germany are determined using a cash flow
obligation at December 31, 2019. The discount rates for plans in Canada, the U.K. and Germany are determined using, a cash flow
matching approach like the U.S.
matching approach like the U.S.
Plan Asset Valuation Due to the lack of timely available market information for certain investments in the asset classes described
Plan Asset Valuation Due to the lack of timely available market information for certain investments in the asset classes described
below as well as the inherent uncertainty of valuation, reported fair values may differ from fair values that would have been used
below as well as the inherent uncertainty of valuation, reported fair values may differ from fair values that would have been used
had timely available market information been available.
had timely available market information been available.
Common and Preferred Stock Common and preferred stock for which market prices are readily available at the measurement
Common and Preferred Stock Common and preferred stock for which market prices are readily available at the measurement
date are valued at the last reported sale price or official closing price on the primary market or exchange on which they are actively
date are valued at the last reported sale price or official closing price on the primary market or exchange on which they are actively
traded and are classified in Level 1. Such equity securities for which the market is not considered to be active are valued via the
traded and are classified in Level 1. Such equity securities for which the market is not considered to be active are valued via the
use of observable inputs, which may include the use of adjusted market prices last available, bids or last available sales prices and/
use of observable inputs, which may include the use of adjusted market prices last available, bids or last available sales prices and/
or other observable inputs and are classified in Level 2. Common and preferred stock classified in Level 3 are privately issued
or other observable inputs and are classified in Level 2. Common and preferred stock classified in Level 3 are privately issued
securities or other issues that are valued via the use of valuation models using significant unobservable inputs that generally
securities or other issues that are valued via the use of valuation models using significant unobservable inputs that generally
consider aged (stale) pricing, earnings multiples, discounted cash flows and/or other qualitative and quantitative factors.
consider aged (stale) pricing, earnings multiples, discounted cash flows and/or other qualitative and quantitative factors.
a
Debt Securities Valuations for debt securities are based on quotations received from independent pricing services or from dealers
Debt Securities Valuations for debt securities are based on quotations received from independent pricing services or from dealers
who make markets in such securities. Debt securities priced via pricing services that utilize matrix pricing which considers readily
who make markets in such securities. Debt securities priced via pricing services that utilize matrix pricing which considers readily
55
55
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
observable inputs such as the yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied
observable inputs such as the yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied
prices, are classified in Level 2. Debt securities that are typically priced by dealers and pricing services via the use of proprietary
prices, are classified in Level 2. Debt securities that are typically priced by dealers and pricing services via the use of proprietary
pricing models which incorporate significant unobservable inputs are classified in Level 3. These inputs primarily consist of yield
pricing models which incorporate significant unobservable inputs are classified in Level 3. These inputs primarily consist of yield
and credit spread assumptions, discount rates, prepayment curves, default assumptions and recovery rates.
and credit spread assumptions, discount rates, prepayment curves, default assumptions and recovery rates.
Investment Funds, Private Equity and Debt Investments and Real Estate Investments Investment funds, private equity and debt
Investment Funds, Private Equity and Debt Investments and Real Estate Investments Investment funds, private equity and debt
investments and real estate investments are valued based on the Net Asset Value (NAV) per Share (or its equivalent) as a practical
investments and real estate investments are valued based on the Net Asset Value (NAV) per Share (or its equivalent) as a practical
expedient to estimate fair value due to the absence of readily available market prices.
expedient to estimate fair value due to the absence of readily available market prices.
NAV's are provided by the respective investment sponsors or investment advisers and are subsequently reviewed and approved
NAV's are provided by the respective investment sponsors or investment advisers and are subsequently reviewed and approved
by management. In the event management concludes a reported NAV does not reflect fair value or is not determined as of the
by management. In the event management concludes a reported NAV does not reflect fair value or is not determined as of the
financial reporting measurement date, we will consider whether and when deemed necessary to make an adjustment at the balance
financial reporting measurement date, we will consider whether and when deemed necessary to make an adjustment at the balance
sheet date. In determining whether an adjustment to the external valuation is required, we will review material factors that could
sheet date. In determining whether an adjustment to the external valuation is required, we will review material factors that could
affect the valuation, such as changes in the composition or performance of the underlying investments or comparable investments,
affect the valuation, such as changes in the composition or performance of the underlying investments or comparable investments,
overall market conditions, expected sale prices for private investments which are probable of being sold in the short-term and other
overall market conditions, expected sale prices for private investments which are probable of being sold in the short-term and other
economic factors that may possibly have a favorable or unfavorable effect on the reported external valuation.
economic factors that may possibly have a favorable or unfavorable effect on the reported external valuation.
Stock Incentive Plans Our stock incentive plans include RSUs, RSAs, PSUs, stock options and awards that may be settled in
Stock Incentive Plans Our stock incentive plans include RSUs, RSAs, PSUs, stock options and awards that may be settled in
our stock, the stock of our subsidiaries or in cash. We measure and record compensation expense based on the fair value of GM
our stock, the stock of our subsidiaries or in cash. We measure and record compensation expense based on the fair value of GM
or Cruise's common stock on the date of grant for RSUs, RSAs and PSUs and the grant date fair value, determined utilizing a
or Cruise's common stock on the date of grant for RSUs, RSAs and PSUs and the grant date fair value, determined utilizing a
lattice model or the Black-Scholes formula, for stock options and PSUs. RSUs granted in stock of Cruise vest upon satisfaction
lattice model or the Black-Scholes formula, for stock options and PSUs. RSUs granted in stock of Cruise vest upon satisfaction
of both a service condition and a liquidity condition, defined as a change in control transaction or the consummation of an initial
of both a service condition and a liquidity condition, defined as a change in control transaction or the consummation of an initial
public offering. Compensation cost for awards that do not have an established accounting grant date, but for which the service
public offering. Compensation cost for awards that do not have an established accounting grant date, but for which the service
inception date has been established, or are settled in cash is based on the fair value of GM or Cruise's common stock at the end of
inception date has been established, or are settled in cash is based on the fair value of GM or Cruise's common stock at the end of
each reporting period. We record compensation cost for service-based RSUs, RSAs, PSUs and service-based stock options on a
each reporting period. We record compensation cost for service-based RSUs, RSAs, PSUs and service-based stock options on a
straight-line basis over the entire vesting period, or for retirement eligible employees over the requisite service period. Compensation
straight-line basis over the entire vesting period, or for retirement eligible employees over the requisite service period. Compensation
costs for RSUs granted in stock of Cruise will be recorded when the liquidity condition described above is met. We use the graded
costs for RSUs granted in stock of Cruise will be recorded when the liquidity condition described above is met. We use the graded
vesting method to record compensation cost for stock options with market conditions over the lesser of the vesting period or the
vesting method to record compensation cost for stock options with market conditions over the lesser of the vesting period or the
time period an employee becomes eligible to retain the award at retirement.
time period an employee becomes eligible to retain the award at retirement.
m
Product Warranty and Recall Campaigns The estimated costs related to product warranties are accrued at the time products
Product Warranty and Recall Campaigns The estimated costs related to product warranties are accrued at the time products
are sold and are charged to Automotive and other cost of sales. These estimates are established using historical information on the
are sold and are charged to Automotive and other cost of sales. These estimates are established using historical information on the
nature, frequency and average cost of claims of each vehicle line or each model year of the vehicle line and assumptions about
nature, frequency and average cost of claims of each vehicle line or each model year of the vehicle line and assumptions about
future activity and events. Revisions are made when necessary and are based on changes in these factors.
future activity and events. Revisions are made when necessary and are based on changes in these factors.
n
The estimated costs related to recall campaigns are accrued when probable and estimable, which is generally at the time of
The estimated costs related to recall campaigns are accrued when probable and estimable, which is generally at the time of
vehicle sale. In GMNA, we estimate the costs related to recall campaigns by applying a paid loss approach that considers the
vehicle sale. In GMNA, we estimate the costs related to recall campaigns by applying a paid loss approach that considers the
number of historical recall campaigns and the estimated cost for each recall campaign. The estimated costs associated with recall
number of historical recall campaigns and the estimated cost for each recall campaign. The estimated costs associated with recall
campaigns in other geographical regions are determined using the estimated costs of repairs and the estimated number of vehicles
campaigns in other geographical regions are determined using the estimated costs of repairs and the estimated number of vehicles
to be repaired. Costs associated with recall campaigns are charged to Automotive and other cost of sales. Revisions are made when
to be repaired. Costs associated with recall campaigns are charged to Automotive and other cost of sales. Revisions are made when
necessary based on changes in these factors.
necessary based on changes in these factors.
Income Taxes The liability method is used in accounting for income taxes. Deferred tax assets and liabilities are recorded for
Income Taxes The liability method is used in accounting for income taxes. Deferred tax assets and liabilities are recorded for
temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial
temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial
statements using the statutory tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred
statements using the statutory tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred
tax assets and liabilities of a change in tax laws or rates is recorded in the results of operations in the period that includes the
tax assets and liabilities of a change in tax laws or rates is recorded in the results of operations in the period that includes the
enactment date under the law.
enactment date under the law.
n
Deferred income tax assets are evaluated quarterly to determine if valuation allowances are required or should be adjusted. We
Deferred income tax assets are evaluated quarterly to determine if valuation allowances are required or should be adjusted. We
establish valuation allowances for deferred tax assets based on a more likely than not standard. The ability to realize deferred tax
establish valuation allowances for deferred tax assets based on a more likely than not standard. The ability to realize deferred tax
assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in
assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in
the tax law for each applicable tax jurisdiction. The assessment regarding whether a valuation allowance is required or should be
the tax law for each applicable tax jurisdiction. The assessment regarding whether a valuation allowance is required or should be
adjusted also considers all available positive and negative evidence factors. It is difficult to conclude a valuation allowance is not
adjusted also considers all available positive and negative evidence factors. It is difficult to conclude a valuation allowance is not
required when there is significant objective and verifiable negative evidence, such as cumulative losses in recent years. We utilize
required when there is significant objective and verifiable negative evidence, such as cumulative losses in recent years. We utilize
a rolling three years of actual and current year results as the primary measure of cumulative losses in recent years.
a rolling three years of actual and current year results as the primary measure of cumulative losses in recent years.
56
56
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Income tax expense (benefit) for the year is allocated between continuing operations and other categories of income such as
Income tax expense (benefit) for the year is allocated between continuing operations and other categories of income such as
Other comprehensive income (loss). In periods in which there is a pre-tax loss from continuing operations and pre-tax income in
Other comprehensive income (loss). In periods in which there is a pre-tax loss from continuing operations and pre-tax income in
another income category, the tax benefit allocated to continuing operations is determined by taking into account the pre-tax income
another income category, the tax benefit allocated to continuing operations is determined by taking into account the pre-tax income
of other categories. We record Global Intangible Low Tax Income (GILTI) as a current period expense when incurred.
of other categories. We record Global Intangible Low Tax Income (GILTI) as a current period expense when incurred.
We record uncertain tax positions on the basis of a two-step process whereby we determine whether it is more likely than not
We record uncertain tax positions on the basis of a two-step process whereby we determine whether it is more likely than not
that the tax positions will be sustained based on the technical merits of the position, and for those tax positions that meet the more
that the tax positions will be sustained based on the technical merits of the position, and for those tax positions that meet the more
likely than not criteria, we recognize the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate
likely than not criteria, we recognize the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate
settlement with the related tax authority. We record interest and penalties on uncertain tax positions in Income tax expense (benefit).
settlement with the related tax authority. We record interest and penalties on uncertain tax positions in Income tax expense (benefit).
t
Foreign Currency Transactions and Translation The assets and liabilities of foreign subsidiaries that use the local currency as
Foreign Currency Transactions and Translation The assets and liabilities of foreign subsidiaries that use the local currency as
their functional currency are translated to U.S. Dollars based on the current exchange rate prevailing at each balance sheet date
their functional currency are translated to U.S. Dollars based on the current exchange rate prevailing at each balance sheet date
and any resulting translation adjustments are included in Accumulated other comprehensive loss. The assets and liabilities of
and any resulting translation adjustments are included in Accumulated other comprehensive loss. The assets and liabilities of
foreign subsidiaries whose local currency is not their functional currency are remeasured from their local currency to their functional
foreign subsidiaries whose local currency is not their functional currency are remeasured from their local currency to their functional
currency and then translated to U.S. Dollars. Revenues and expenses are translated into U.S. Dollars using the average exchange
currency and then translated to U.S. Dollars. Revenues and expenses are translated into U.S. Dollars using the average exchange
rates prevailing for each period presented. The financial statements of any foreign subsidiary that has been identified as having a
rates prevailing for each period presented. The fmancial statements of any foreign subsidiary that has been identified as having a
highly inflationary economy are remeasured as if the functional currency were the U.S. Dollar.
highly inflationary economy are remeasured as if the functional currency were the U.S. Dollar.
uu
Gains and losses arising from foreign currency transactions and the effects of remeasurements discussed in the preceding
Gains and losses arising from foreign currency transactions and the effects of remeasurements discussed in the preceding
paragraph are recorded in Automotive and other cost of sales and GM Financial interest, operating and other expenses unless
paragraph are recorded in Automotive and other cost of sales and GM Financial interest, operating and other expenses unless
related to Automotive debt, which are recorded in Interest income and other non-operating income, net. Foreign currency transaction
related to Automotive debt, which are recorded in Interest income and other non-operating income, net. Foreign currency transaction
and remeasurement gains were $85 million and losses were $168 million and $52 million in the years ended December 31, 2019,
and remeasurement gains were $85 million and losses were $168 million and $52 million in the years ended December 31, 2019,
2018 and 2017.
2018 and 2017.
Derivative Financial Instruments Derivative financial instruments are recognized as either assets or liabilities at fair value. The
Derivative Financial Instruments Derivative fmancial instruments are recognized as either assets or liabilities at fair value. The
accounting for changes in the fair value of each derivative financial instrument depends on whether it has been designated and
accounting for changes in the fair value of each derivative financial instrument depends on whether it has been designated and
qualifies as an accounting hedge, as well as the type of hedging relationship identified. Derivative instruments are not used for
qualifies as an accounting hedge, as well as the type of hedging relationship identified. Derivative instruments are not used for
trading or speculative purposes.
trading or speculative purposes.
ff
Automotive We utilize options, swaps and forward contracts to manage foreign currency and commodity price risk. The change
Automotive We utilize options, swaps and forward contracts to manage foreign currency and commodity price risk. The change
in fair value of option and forward contracts not designated as hedges is recorded in Interest income and other non-operating
in fair value of option and forward contracts not designated as hedges is recorded in Interest income and other non-operating
income, net. Cash flows for all derivative financial instruments are classified in cash flows from operating activities.
income, net. Cash flows for all derivative fmancial instruments are classified in cash flows from operating activities.
We estimate the fair value of the PSA warrants using a Black-Scholes formula. The significant inputs to the model include the
We estimate the fair value of the PSA warrants using a Black-Scholes formula. The significant inputs to the model include the
PSA stock price and the estimated dividend yield. We are entitled to receive any dividends declared by PSA through the conversion
PSA stock price and the estimated dividend yield. We are entitled to receive any dividends declared by PSA through the conversion
date upon exercise of the warrants. Gains or losses as a result of the change in the fair value of the PSA warrants are recorded in
date upon exercise of the warrants. Gains or losses as a result of the change in the fair value of the PSA warrants are recorded in
Interest income and other non-operating income, net.
Interest income and other non-operating income, net.
Automotive Financing - GM Financial GM Financial utilizes interest rate derivative instruments to manage interest rate risk
Automotive Financing - GM Financial GM Financial utilizes interest rate derivative instruments to manage interest rate risk
and foreign currency derivative instruments to manage foreign currency risk. The change in fair value of the derivative instruments
and foreign currency derivative instruments to manage foreign currency risk. The change in fair value of the derivative instruments
not designated as hedges is recorded in GM Financial interest, operating and other expenses. Cash flows for all derivative financial
not designated as hedges is recorded in GM Financial interest, operating and other expenses. Cash flows for all derivative financial
instruments are classified in cash flows from operating activities.
instruments are classified in cash flows from operating activities.
a
l
Certain interest rate and foreign currency swap agreements have been designated as fair value hedges. The risk being hedged is
Certain interest rate and foreign currency swap agreements have been designated as fair value hedges. The risk being hedged is
the risk of changes in the fair value of the hedged debt attributable to changes in the benchmark interest rate or the risk of changes
the risk of changes in the fair value of the hedged debt attributable to changes in the benchmark interest rate or the risk of changes
in fair value attributable to changes in foreign currency exchange rates. If the swap has been designated as a fair value hedge, the
in fair value attributable to changes in foreign currency exchange rates. If the swap has been designated as a fair value hedge, the
changes in the fair value of the hedged item are recorded in GM Financial interest, operating and other expenses. The change in
changes in the fair value of the hedged item are recorded in GM Financial interest, operating and other expenses. The change in
fair value of the related hedge is also recorded in GM Financial interest, operating and other expenses.
fair value of the related hedge is also recorded in GM Financial interest, operating and other expenses.
Certain interest rate swap and foreign currency swap agreements have been designated as cash flow hedges. The risk being
Certain interest rate swap and foreign currency swap agreements have been designated as cash flow hedges. The risk being
hedged is the interest rate and foreign currency risk related to forecasted transactions. If the contract has been designated as a cash
hedged is the interest rate and foreign currency risk related to forecasted transactions. If the contract has been designated as a cash
flow hedge, the change in the fair value of the cash flow hedge is deferred in Accumulated other comprehensive loss and is
flow hedge, the change in the fair value of the cash flow hedge is deferred in Accumulated other comprehensive loss and is
recognized in GM Financial interest, operating and other expenses along with the earnings effect of the hedged item when the
recognized in GM Financial interest, operating and other expenses along with the earnings effect of the hedged item when the
hedged item affects earnings. Changes in the fair value of amounts excluded from the assessment of effectiveness are recorded
hedged item affects earnings. Changes in the fair value of amounts excluded from the assessment of effectiveness are recorded
currently in earnings and are presented in the same income statement line as the earnings effect of the hedged item.
currently in earnings and are presented in the same income statement line as the earnings effect of the hedged item.
57
57
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Recently Adopted Accounting Standards Effective January 1, 2019, we adopted ASU 2016-02, "Leases" (ASU 2016-02) using
Recently Adopted Accounting Standards Effective January 1, 2019, we adopted ASU 2016-02, "Leases" (ASU 2016-02) using
the modified retrospective method, resulting in a cumulative-effect adjustment to the opening balance of Retained earnings for an
the modified retrospective method, resulting in a cumulative-effect adjustment to the opening balance of Retained earnings for an
insignificant amount. We recognized $1.0 billion of right of use assets and lease obligations included in Other assets, Accrued
insignificant amount. We recognized $1.0 billion of right of use assets and lease obligations included in Other assets, Accrued
liabilities and Other liabilities on our consolidated balance sheet for our existing operating lease portfolio at January 1, 2019. We
liabilities and Other liabilities on our consolidated balance sheet for our existing operating lease portfolio at January 1, 2019. We
elected to apply the practical expedient related to land easements, as well as the package of practical expedients permitted under
elected to apply the practical expedient related to land easements, as well as the package of practical expedients permitted under
the transition guidance in the new standard, which allowed us to carry forward our historical lease classification. The accounting
the transition guidance in the new standard, which allowed us to carry forward our historical lease classification. The accounting
for our finance leases and leases where we are the lessor remained substantially unchanged. The application of ASU 2016-02 had
for our fmance leases and leases where we are the lessor remained substantially unchanged. The application of ASU 2016-02 had
no impact on our consolidated income statement or consolidated statement of cash flows.
no impact on our consolidated income statement or consolidated statement of cash flows.
The following table summarizes our minimum commitments under noncancelable operating leases having initial terms in excess
The following table summarizes our minimum commitments under noncancelable operating leases having initial terms in excess
of one year, primarily for property, at December 31, 2018 as disclosed in our 2018 Form 10-K:
of one year, primarily for property, at December 31, 2018 as disclosed in our 2018 Form 10-K:
Years Ending December 31,
Years Ending December 31,
2019
Total
2022
2019 2020 2021 2022 2023 Thereafter Total
Minimum commitments(a) . . . . . . . . . . . . . . . $
$ 1,737
Minimum commitments(a) $ 296 $ 286 S 247 $ 180 $ 146 $ 582 $ 1,737
(356)
Sublease income . . . . . . . . . . . . . . . . . . . . . . .
Sublease income (61) (51) (44) (38) (33) (129) (356)
Net minimum commitments . . . . . . . . . . . . . . $
$ 1,381
Net minimum commitments $ 235 $ 235 $ 203 $ 142 $ 113 $ 453 $ 1,381
Thereafter
582
$
(129)
453
247
(44)
203
286
(51)
235
180
(38)
142
146
(33)
113
(61)
235
296
2023
2020
2021
$
$
$
$
$
$
$
$
$
_________
(a) Certain leases contain escalation clauses and renewal or purchase options.
(a) Certain leases contain escalation clauses and renewal or purchase options.
Refer to Note 16 for information on our operating leases at December 31, 2019.
Refer to Note 16 for information on our operating leases at December 31, 2019.
Accounting Standards Not Yet Adopted In June 2016 the Financial Accounting Standards Board issued ASU 2016-13, "Financial
Accounting Standards Not Yet Adopted In June 2016 the Financial Accounting Standards Board issued ASU 2016-13, "Financial
Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" (ASU 2016-13), which requires
Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" (ASU 2016-13), which requires
entities to use a new impairment model based on Current Expected Credit Losses (CECL) rather than incurred losses. We adopted
entities to use a new impairment model based on Current Expected Credit Losses (CECL) rather than incurred losses. We adopted
ASU 2016-13 on January 1, 2020 on a modified retrospective basis. Upon adoption, estimated credit losses under CECL consider
ASU 2016-13 on January 1, 2020 on a modified retrospective basis. Upon adoption, estimated credit losses under CECL consider
relevant information about past events, current conditions and reasonable and supportable forecasts that affect the collectibility of
relevant information about past events, current conditions and reasonable and supportable forecasts that affect the collectibility of
the reported amount, resulting in recognition of lifetime expected credit losses upon loan origination. The adoption impact of ASU
the reported amount, resulting in recognition of lifetime expected credit losses upon loan origination. The adoption impact ofASU
2016-13 will increase our allowance for credit losses by approximately $800 million, with an after-tax reduction to Retained
2016-13 will increase our allowance for credit losses by approximately $800 million, with an after-tax reduction to Retained
earnings of approximately $600 million.
earnings of approximately $600 million.
Note 3. Revenue
Note 3. Revenue
The following table disaggregates our revenue by major source for revenue generating segments:
The following, table disaggregates our revenue by major source for revenue generating segments:
Year Ended December 31, 2019
Year Ended December 31, 2019
Corporate
$
Total
Eliminations/
Total GM Eliminations/
GMNA
Total
Automotive
Reclassifications
GMNA GMI Corporate Automotive Cruise Financial Reclassifications Total
Vehicle, parts and accessories. . . . . . . . $101,346
— $116,277
— $ 116,277
Vehicle, parts and accessories $101,346 $14,931 $ — $ 116,277 $ — $ — $ — $116,277
Used vehicles . . . . . . . . . . . . . . . . . . . .
2,019
—
1,896
2,019
—
Used vehicles 1,896 123 2,019 — 2,019
4,401
(100)
4,401
220
Services and other . . . . . . . . . . . . . . . . .
3,124
Services and other 3,124 1.057 220 4,401 100 (100) 4,401
Automotive net sales and revenue . . .
122,697
(100)
122,697
220
106,366
Automotive net sales and revenue . . 106,366 16.111 220 122,697 100 (100) 122,697
Leased vehicle income . . . . . . . . . . . . .
10,032
—
—
—
—
Leased vehicle income 10,032 — 10,032
Finance charge income . . . . . . . . . . . . .
4,064
(7)
—
—
—
Finance charge income 4,071 (7) 4,064
444
(7)
—
—
—
Other income. . . . . . . . . . . . . . . . . . . . .
Other income 451 (7) 444
GM Financial net sales and revenue. .
14,540
(14)
—
—
—
GM Financial net sales and revenue 14,554 (14) 14,540
Net sales and revenue . . . . . . . . . . . . . . $106,366
)
(
(114) $137,237
$ 122,697
220
Net sales a.nd revenue $106,366 $16.111 S 220 $ 122,697 $ 100 $ 14,554 $ (114) $137,237
— $
—
—
—
10,032
4,071
451
14,554
$ 14,554
Cruise
$ — $
—
100
100
—
—
—
—
$ 100
GMI
$14,931
123
1,057
16,111
—
—
—
—
$16,111
GM
Financial
$
$
58
58
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GMNA
GMNA
Vehicle, parts and accessories. . . . . . . . $ 107,217
Vehicle, parts and accessories $ 107,217
3,215
Used vehicles . . . . . . . . . . . . . . . . . . . .
Used vehicles 3,215
3,360
Services and other . . . . . . . . . . . . . . . . .
Services and other 3,360
Automotive net sales and revenue . . .
113,792
113,792
Automotive net sales and revenue . .
—
Leased vehicle income . . . . . . . . . . . . .
Leased vehicle income
—
Finance charge income . . . . . . . . . . . . .
Finance charge income
Other income. . . . . . . . . . . . . . . . . . . . .
—
Other income
—
GM Financial net sales and revenue. .
GM Financial net sales and revenue
Net sales and revenue . . . . . . . . . . . . . . $ 113,792
Net sales and revenue $ 113,792
GMI
GMI
$
17,980
$ 17,980
175
175
993
993
19,148
19,148
—
—
—
—
$
19,148
$ 19,148
Year Ended December 31, 2018
Year Ended December 31, 2018
GM
GM
Eliminations
Total
Total
Financial Eliminations
Financial
$
125,155
$ — $ (62) $ 125,155
3,354
3,354
4,536
4,536
133,045
133,045
9,963
9,963
3,621
3,621
420
420
14,004
14,004
$
147,049
$ 14,016 $ (110) $ 147,049
(62) $
— $
(36)
—
(36)
—
—
—
(98)
(98)
—
9,963
9,963
(8)
3,629
3,629 (8)
(4)
424
424 (4)
14,016
(12)
14,016 (12)
)
(
(110) $
14,016
Total
Total
Automotive
Automotive
125,217
$
$ 125,217
3,390
3,390
4,536
4,536
133,143
133,143
—
—
—
—
$
133,143
$ 133,143
Corporate
C orporate
20
$
$ 70
—
183
183
203
703
—
—
—
—
$
203
$ 203
$
Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing
Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing
services. Adjustments to sales incentives for previously recognized sales were insignificant during the years ended December 31,
services. Adjustments to sales incentives for previously recognized sales were insignificant during the years ended December 31,
2019 and 2018.
2019 and 2018.
Contract liabilities in our Automotive segments primarily consist of maintenance, extended warranty and other service contracts.
Contract liabilities in our Automotive segments primarily consist of maintenance, extended warranty and other service contracts.
We recognized revenue of $1.5 billion and $1.4 billion related to contract liabilities during the years ended December 31, 2019
We recognized revenue of $1.5 billion and $1.4 billion related to contract liabilities during the years ended December 31, 2019
and 2018. We expect to recognize revenue of $1.1 billion, $487 million and $658 million in the years ending December 31, 2020,
and 2018. We expect to recognize revenue of $1.1 billion, $487 million and $658 million in the years ending December 31, 2020,
2021 and thereafter related to contract liabilities as of December 31, 2019.
2021 and thereafter related to contract liabilities as of December 31, 2019.
59
59
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 4. Marketable and Other Securities
Note 4. Marketable and Other Securities
The following table summarizes the fair value of cash equivalents and marketable debt and equity securities, which approximates
The following table summarizes the fair value of cash equivalents and marketable debt and equity securities, which approximates
cost:
cost:
Cash and cash equivalents
Cash and cash equivalents
6,828
Cash and time deposits(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash and time deposits(a) 6,828
Available-for-sale debt securities
Available-for-sale debt securities
$
$
7,254
$ 7,254
Fair Value
Fair Value
Level
Level
December 31, 2019 December 31, 2018
December 31, 2019 December 31, 2018
U.S. government and agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
U.S. government and agencies 2
Corporate debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Corporate debt 2
Sovereign debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Sovereign debt 2
Total available-for-sale debt securities – cash equivalents . . . . . . . . . . . . . . . . .
Total available-for-sale debt securities — cash equivalents
2,771
Money market funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1
2,771
Money market funds 1
Total cash and cash equivalents(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19,069
Total cash and cash equivalents(b) 19,069
Marketable debt securities
Marketable debt securities
1,484
1,484
5,863
5,863
2,123
2,123
9,470
9,470
$
4,656
4,656
3,791
3,791
1,976
1,976
10,423
10,423
3,167
3,167
$
20,844
$ 20,844
U.S. government and agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
U.S. government and agencies 2
Corporate debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Corporate debt 2
Mortgage and asset-backed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Mortgage and asset-backed 2
Sovereign debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Sovereign debt 2
Total available-for-sale debt securities – marketable securities(c) . . . . . . . . . . .
Total available-for-sale debt securities — marketable securities(c)
Restricted cash
Restricted cash
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
292
Cash and cash equivalents 292
3,582
Money market funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1
3,582
Money market funds 1
Total restricted cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,874
Total restricted cash 3,874
$
$
$
$
$
$
226
1,230
$ 1,230
226
3,478
2,932
3,478
2,932
695
681
695
681
563
335
563
335
4,174
5,966
4,174 $ 5.966
$
$
260
$ 260
2,392
2,392
$
2,652
$ 2,652
Available-for-sale debt securities included above with contractual
Available-for-sale debt securities included above with contractual
maturities(d)
maturities(d)
Due in one year or less. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,213
Due in one year or less 10,213
2,750
Due between one and five years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Due between one and five years 2,750
12,963
Total available-for-sale debt securities with contractual maturities. . . . . . . . . . .
12,963
Total available-for-sale debt securities with contractual maturities
$
$
__________
(a) Includes $248 million and $616 million that is designated exclusively to fund capital expenditures in GM Korea at December 31, 2019
(a) Includes $248 million and $616 million that is designated exclusively to fund capital expenditures in GM Korea at December 31. 2019
and 2018. Refer to Note 20 for additional information.
and 2018. Refer to Note 20 for additional information.
(b) Includes $2.3 billion in Cruise at December 31, 2019 and 2018. Refer to Note 20 for additional information.
(b) Includes $2.3 billion in Cruise at December 31, 2019 and 2018. Refer to Note 20 for additional information.
(c) Includes $266 million in Cruise at December 31, 2019.
(c) Includes $266 million in Cruise at December 31, 2019.
(d) Excludes mortgage- and asset-backed securities of $681 million at December 31, 2019 as these securities are not due at a single maturity
(d) Excludes mortgage- and asset-backed securities of $681 million at December 31, 2019 as these securities are not due at a single maturity
date.
date.
Proceeds from the sale of available-for-sale debt investments sold prior to maturity were $4.5 billion, $4.3 billion and $5.6
Proceeds from the sale of available-for-sale debt investments sold prior to maturity were $4.5 billion, $4.3 billion and $5.6
billion in the years ended December 31, 2019, 2018 and 2017. Net unrealized gains and losses on available-for-sale debt securities
billion in the years ended December 31, 2019, 2018 and 2017. Net unrealized gains and losses on available-for-sale debt securities
were insignificant in the years ended December 31, 2019, 2018 and 2017. Cumulative unrealized gains and losses on available-
were insignificant in the years ended December 31, 2019, 2018 and 2017. Cumulative unrealized gains and losses on available-
for-sale debt securities were insignificant at December 31, 2019 and 2018.
for-sale debt securities were insignificant at December 31, 2019 and 2018.
Our remaining investment in Lyft was measured at fair value at December 31, 2019 using Lyft’s quoted market price, a Level
Our remaining investment in Lyft was measured at fair value at December 31, 2019 using Lyft's quoted market price, a Level
1 input. Prior to Lyft's initial public offering, our investment in Lyft was measured at fair value using Level 3 inputs at December
1 input. Prior to Lyft's initial public offering, our investment in Lyft was measured at fair value using Level 3 inputs at December
31, 2018. The fair value of this investment was $535 million included in Other current assets and $884 million included in Other
31, 2018. The fair value of this investment was $535 million included in Other current assets and $884 million included in Other
assets at December 31, 2019 and 2018. We recorded an insignificant unrealized loss and an unrealized gain of $142 million in
assets at December 31, 2019 and 2018. We recorded an insignificant unrealized loss and an unrealized gain of $142 million in
Interest income and other non-operating income, net in the years ended December 31, 2019 and 2018.
Interest income and other non-operating income, net in the years ended December 31, 2019 and 2018.
60
60
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated
balance sheets that sum to the total of the same amounts shown in the consolidated statements of cash flows:
balance sheets that sum to the total of the same amounts shown in the consolidated statements of cash flows:
December 31, 2019
December 31, 2019
19,069
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash and cash equivalents $ 19,069
Restricted cash included in Other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,352
Restricted cash included in Other current assets 3,352
Restricted cash included in Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
522
Restricted cash included in Other assets 522
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
22,943
Total S 22,943
December 31, 2018
December 31, 2018
20,844
$
$ 20,844
2,083
2,083
569
569
$
23,496
$ 23,496
Note 5. GM Financial Receivables and Transactions
Note 5. GM Financial Receivables and Transactions
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Retail
Retail
Commercial(a)
Commercial(a)
Total
Total
Retail
Retail
Commercial(a)
Commercial(a)
Total
Total
Finance receivables, collectively evaluated for
Finance receivables, collectively evaluated for
impairment, net of fees . . . . . . . . . . . . . . . . . . . $ 39,851
impairment, net of fees $ 39,851
Finance receivables, individually evaluated for
Finance receivables, individually evaluated for
impairment, net of fees(b) . . . . . . . . . . . . . . . . .
2,378
impairment, net of fees(b) 2,378
GM Financial receivables . . . . . . . . . . . . . . . . . . .
42,229
GM Financial receivables 42,229
Less: allowance for loan losses. . . . . . . . . . . . . . .
(866)
Less: allowance for loan losses (866)
GM Financial receivables, net . . . . . . . . . . . . . . . $ 41,363
GM Financial receivables, net $ 41,363
$
11,595
$ 11,595
$ 51,446
$ 51,446
$ 38,220
$ 38,220
$
12,235
$ 12,235
$ 50,455
$ 50,455
76
76
11,671
11.671
(78)
(78)
$
11,593
$ 11,593
2,454
2,454
53,900
53,900
(944)
(944)
$ 52,956
$ 52,956
2,348
2,348
40,568
40,568
(844)
(844)
$ 39,724
$ 39,724
41
41
12,276
12.276
(67)
(67)
$
12,209
$ 12.209
2,389
2,389
52,844
52,844
(911)
(911)
$ 51,933
$ 51,933
Fair value of GM Financial receivables utilizing
Fair value of GM Financial receivables utilizing
Level 2 inputs . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 2 inputs
Fair value of GM Financial receivables utilizing
Fair value of GM Financial receivables utilizing
Level 3 inputs . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 3 inputs
$ 11,593
$ 11,593
$ 41,973
$ 41,973
$ 12,209
$ 12,209
$ 39,430
$ 39,430
__________
(a) Net of dealer cash management balances of $1.2 billion and $922 million at December 31, 2019 and 2018. Under the cash management
(a) Net of dealer cash management balances of $1.2 billion and $922 million at December 31, 2019 and 2018. Under the cash management
program, subject to certain conditions, a dealer may choose to reduce the amount of interest on their fioorplan line by making principal
program, subject to certain conditions, a dealer may choose to reduce the amount of interest on their floorplan line by making principal
payments to GM Financial in advance.
payments to GM Financial in advance.
(b) The allowance for loan losses included $330 million and $321 million of specific allowances on retail receivables at December 31, 2019
(b) The allowance for loan losses included $330 million and $321 million of specific allowances on retail receivables at December 31, 2019
and 2018.
and 2018.
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Allowance for loan losses at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
911
Allowance for loan losses at beginning of period $ 911
Provision for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
726
Provision for loan losses 726
(1,246)
Charge-offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Charge-offs (1,246)
Recoveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
551
Recoveries 551
Effect of foreign currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Effect of foreign currency 2
Allowance for loan losses at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
944
Allowance for loan losses at end of period 944
$
942
$ 942
642
642
(1,199)
(1,199)
536
536
(10)
(10)
$
911
$ 911
$
805
$ 805
757
757
(1,173)
(1,173)
552
552
1
1
$
942
$ 942
The allowance for loan losses on retail and commercial finance receivables included a collective allowance of $596 million,
The allowance for loan losses on retail and commercial finance receivables included a collective allowance of $596 million.
$586 million and $611 million and a specific allowance of $348 million, $325 million and $331 million at December 31, 2019,
$586 million and $611 million and a specific allowance of $348 million, $325 million and $331 million at December 31, 2019.
2018 and 2017. Refer to Note 2 for expected impact of adoption of ASU 2016-13.
2018 and 2017. Refer to Note 2 for expected impact of adoption of ASU 2016-13.
Retail Finance Receivables We use proprietary scoring systems in the underwriting process that measure the credit quality of
Retail Finance Receivables We use proprietary scoring systems in the underwriting process that measure the credit quality of
retail finance receivables using several factors, such as credit bureau information, consumer credit risk scores (e.g. FICO score or
retail finance receivables using several factors, such as credit bureau information, consumer credit risk scores (e.g. FICO score or
its equivalent) and contract characteristics. We also consider other factors such as employment history, financial stability and
its equivalent) and contract characteristics. We also consider other factors such as employment history, financial stability and
capacity to pay. Subsequent to origination we review the credit quality of retail finance receivables based on customer payment
capacity to pay. Subsequent to origination we review the credit quality of retail finance receivables based on customer payment
activity. At December 31, 2019 and 2018 24% and 25% of retail finance receivables were from consumers with sub-prime credit
activity. At December 31, 2019 and 2018 24% and 25% of retail fmance receivables were from consumers with sub-prime credit
scores, which are defined as a FICO score or its equivalent of less than 620 at the time of loan origination.
scores, which are defmed as a FICO score or its equivalent of less than 620 at the time of loan origination.
61
61
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We purchase retail finance contracts from automobile dealers without recourse, and accordingly, the dealer has no liability to
We purchase retail finance contracts from automobile dealers without recourse, and accordingly, the dealer has no liability to
GM Financial if the consumer defaults on the contract. Finance receivables are collateralized by vehicle titles and GM Financial
GM Financial if the consumer defaults on the contract. Finance receivables are collateralized by vehicle titles and GM Financial
has the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract.
has the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract.
An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date the payment
An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date the payment
was contractually due. The accrual of finance charge income had been suspended on delinquent retail finance receivables with
was contractually due. The accrual of fmance charge income had been suspended on delinquent retail fmance receivables with
contractual amounts due of $875 million and $888 million at December 31, 2019 and 2018. The following table summarizes the
contractual amounts due of $875 million and $888 million at December 31, 2019 and 2018. The following table summarizes the
contractual amount of delinquent retail finance receivables, which is not significantly different than the recorded investment of
contractual amount of delinquent retail fmance receivables, which is not significantly different than the recorded investment of
the retail finance receivables:
the retail finance receivables:
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Amount
Amount
31-to-60 days delinquent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,354
31 -to-60 days delinquent $ 1,354
Greater-than-60 days delinquent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
542
Greater-than-60 days delinquent 542
Total finance receivables more than 30 days delinquent . . . . . . . . . . . . . . . . . .
1,896
Total fmance receivables more than 30 days delinquent 1,896
In repossession . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
44
In repossession 44
Total finance receivables more than 30 days delinquent or in repossession . . . $ 1,940
Total fmance receivables more than 30 days delinquent or in repossession . . . $ 1,940
Percent of
Percent of
Contractual
Contractual
Amount
Amount Due
Amount Due Amount
3.2% $ 1,349
3.2% $ 1,349
1.3%
547
1.3% 547
4.5%
1,896
4.5% 1,896
0.1%
44
0.1% 44
4.6% $ 1,940
4.6% $ 1,940
Percent of
Percent of
Contractual
Contractual
Amount Due
Amount Due
3.3%
3.3%
1.4%
1.4%
4.7%
4.7%
0.1%
0.1%
4.8%
4.8%
Commercial Finance Receivables Our commercial finance receivables consist of dealer financings, primarily for inventory
Commercial Finance Receivables Our commercial finance receivables consist of dealer fmancings, primarily for inventory
purchases. Proprietary models are used to assign a risk rating to each dealer. We perform periodic credit reviews of each dealership
purchases. Proprietary models are used to assign a risk rating to each dealer. We perform periodic credit reviews of each dealership
and adjust the dealership's risk rating, if necessary. Dealers in Group VI are subject to additional restrictions on funding, including
and adjust the dealership's risk rating, if necessary. Dealers in Group VI are subject to additional restrictions on funding, including
suspension of lines of credit and liquidation of assets. The commercial finance receivables on nonaccrual status were insignificant
suspension of lines of credit and liquidation of assets. The commercial fmance receivables on nonaccrual status were insignificant
at December 31, 2019 and 2018. The following table summarizes the credit risk profile by dealer risk rating of the commercial
at December 31, 2019 and 2018. The following table summarizes the credit risk profile by dealer risk rating of the commercial
finance receivables:
finance receivables:
December 31, 2019
December 31, 2019
1,942 $
Group I
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,942
Group I — Dealers with superior financial metrics $
Group II – Dealers with strong financial metrics
4,552
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Group II — Dealers with strong fmancial metrics 4,552
Group III – Dealers with fair financial metrics
3,711
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Group III — Dealers with fair fmancial metrics 3,711
Group IV – Dealers with weak financial metrics
968
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Group IV — Dealers with weak financial metrics 968
Group V – Dealers warranting special mention due to elevated risks
370
. . . . . . . . . . . . . . .
Group V — Dealers warranting special mention due to elevated risks 370
Group VI – Dealers with loans classified as substandard, doubtful or impaired
128
. . . . . . .
Group VI — Dealers with loans classified as substandard, doubtful or impaired
128
$
11,671 $
$ 11,671
–
– Dealers with superior financial metrics
–
–
–
–
–
December 31, 2018
December 31, 2018
2,192
$ 2,192
4,399
4,399
4,064
4,064
1,116
1,116
422
422
83
83
12,276
$ 12,276
Transactions with GM Financial The following table shows transactions between our Automotive segments and GM Financial.
Transactions with GM Financial The following table shows transactions between our Automotive segments and GM Financial.
These amounts are presented in GM Financial's consolidated balance sheets and statements of income. All balance sheet amounts
These amounts are presented in GM Financial's consolidated balance sheets and statements of income. All balance sheet amounts
in the table below are eliminated.
in the table below are eliminated.
62
62
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Consolidated Balance Sheets(a)
Consolidated Balance Sheets(a)
Commercial finance receivables, net due from GM consolidated dealers . . . . . . . . . . . . . $
445
Commercial finance receivables, net due from GM consolidated dealers $ 478 $ 445
134
Direct-financing lease receivables from GM subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . $
Direct-fmancing lease receivables from GM subsidiaries $ 39 $ 134
Subvention receivable(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
727
Subvention receivable(b) $ 676 $ 727
Commercial loan funding payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
61
Commercial loan funding payable $ 74 $ 61
39
676
478
$
$
74
$
$
Years Ended December 31,
Years Ended December 31,
2019
2019 2018 2017
2017
2018
Consolidated Statements of Income
Consolidated Statements of Income
492
Interest subvention earned on finance receivables . . . . . . . . . . . . . . . . . . . . . $
Interest subvention earned on finance receivables $ 588 S 554 $ 492
Leased vehicle subvention earned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
3,046
Leased vehicle subvention earned $ 3,273 $ 3,274 $ 3,046
3,273
3,274
554
588
$
$
$
$
__________
(a) All balance sheet amounts are eliminated upon consolidation.
(a) All balance sheet amounts are eliminated upon consolidation.
(b) Our Automotive segments made cash payments to GM Financial for subvention of $4.1 billion, $3.8 billion. and $4.3 billion in the years
(b) Our Automotive segments made cash payments to GM Financial for subvention of $4.1 billion, $3.8 billion, and $4.3 billion in the years
ended December 31, 2019, 2018 and 2017.
ended December 31, 2019, 2018 and 2017.
GM Financial's Board of Directors declared and paid dividends of $400 million and $375 million on its common stock in October
GM Financial's Board of Directors declared and paid dividends of $400 million and $375 million on its common stock in October
2019 and 2018.
2019 and 2018.
Note 6. Inventories
Note 6. Inventories
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Total productive material, supplies and work in process . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,274
$
4,713
Total productive material, supplies and work in process S 4,713 $ 4,274
Finished product, including service parts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,542
Finished product, including service parts 5,685 5,542
Total inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
9,816
Total inventories 10,398 $ 9,816
10,398
5,685
$
Note 7. Equipment on Operating Leases
Note 7. Equipment on Operating Leases
Equipment on operating leases primarily consists of leases to retail customers of GM Financial. The current portion of net
Equipment on operating leases primarily consists of leases to retail customers of GM Financial. The current portion of net
equipment on operating leases is included in Other current assets.
equipment on operating leases is included in Other current assets.
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Equipment on operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
55,282
53,081
$
Equipment on operating leases $ 53,081 $ 55,282
(11,476)
(10,989)
Less: accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: accumulated depreciation (10,989) (11,476)
Equipment on operating leases, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
43,806
42,092
Equipment on operating leases, net $ 42,092 $ 43,806
$
At December 31, 2019, the estimated residual value of our leased assets at the end of the lease term was $30.4 billion.
At December 31, 2019, the estimated residual value of our leased assets at the end of the lease term was $30.4 billion.
Depreciation expense related to Equipment on operating leases, net was $7.3 billion, $7.5 billion and $6.7 billion in the years
Depreciation expense related to Equipment on operating leases, net was $7.3 billion, $7.5 billion and $6.7 billion in the years
ended December 31, 2019, 2018 and 2017.
ended December 31, 2019, 2018 and 2017.
The following table summarizes lease payments due to GM Financial on leases to retail customers:
The following table summarizes lease payments due to GM Financial on leases to retail customers:
Years Ending December 31,
Years Ending December 31,
2020
Total
2020 2021 2022 2023 2024 Total
Lease receipts under operating leases . . . . . . . . . . . . . . . . . . . . . $ 6,517
$12,345
Lease receipts under operating leases $ 6,517 $ 4,080 $ 1,607 $ 137 $ 4 $12,345
2021
$ 4,080
2022
$ 1,607
137
2023
2024
$
4
$
Note 8. Equity in Net Assets of Nonconsolidated Affiliates
Note 8. Equity in Net Assets of Nonconsolidated Affiliates
Nonconsolidated affiliates are entities in which we maintain an equity ownership interest and for which we use the equity method
Nonconsolidated affiliates are entities in which we maintain an equity ownership interest and for which we use the equity method
of accounting due to our ability to exert significant influence over decisions relating to their operating and financial affairs. Revenue
of accounting due to our ability to exert significant influence over decisions relating to their operating and fmancial affairs. Revenue
63
63
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
and expenses of our joint ventures are not consolidated into our financial statements; rather, our proportionate share of the earnings
and expenses of our joint ventures are not consolidated into our financial statements; rather, our proportionate share of the earnings
of each joint venture is reflected as Equity income.
of each joint venture is reflected as Equity income.
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Automotive China equity income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,132
Automotive China equity income 1,132
Other joint ventures equity income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
136
Other joint ventures equity income 136
Total Equity income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,268
Total Equity income 1,268
$
1,981
$ 1,981
182
182
$
2,163
$ 2,163
$
1,976
$ 1,976
156
156
$
2,132
$ 2,132
Investments in Nonconsolidated Affiliates
Investments in Nonconsolidated Affiliates
December 31, 2019
December 31, 2019
Automotive China carrying amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
7,044
Automotive China carrying amount 7,044
Other investments carrying amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,518
Other investments carrying amount 1,518
Total equity in net assets of nonconsolidated affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . $
8,562
Total equity in net assets of nonconsolidated affiliates 8,562
December 31, 2018
December 31, 2018
$
7,779
$ 7,779
1,436
1,436
$
9,215
$ 9,215
The carrying amount of our investments in certain joint ventures exceeded our share of the underlying net assets by $4.2 billion
The carrying amount of our investments in certain joint ventures exceeded our share of the underlying net assets by $4.2 billion
and $4.4 billion at December 31, 2019 and 2018 primarily due to goodwill from the application of fresh-start reporting and the
and $4.4 billion at December 31, 2019 and 2018 primarily due to goodwill from the application of fresh-start reporting and the
purchase of additional interests in nonconsolidated affiliates.
purchase of additional interests in nonconsolidated affiliates.
The following table summarizes our direct ownership interests in our China JVs:
The following table summarizes our direct ownership interests in our China JVs:
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Automotive China JVs
Automotive China JVs
SAIC General Motors Corp., Ltd. (SGM) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50%
SAIC General Motors Corp., Ltd. (SGM) 50%
Pan Asia Technical Automotive Center Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50%
Pan Asia Technical Automotive Center Co., Ltd 50%
SAIC General Motors Sales Co., Ltd.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
49%
SAIC General Motors Sales Co., Ltd. 49%
SAIC GM Wuling Automobile Co., Ltd. (SGMW) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
44%
SAIC GM Wuling Automobile Co., Ltd. (SGMW) 44%
Shanghai OnStar Telematics Co., Ltd. (Shanghai OnStar) . . . . . . . . . . . . . . . . . . . . . . . . .
40%
Shanghai OnStar Telematics Co., Ltd. (Shanghai OnStar) 40%
SAIC GM (Shenyang) Norsom Motors Co., Ltd. (SGM Norsom). . . . . . . . . . . . . . . . . . .
25%
SAIC GM (Shenyang) Norsom Motors Co., Ltd. (SGM Norsom) 25%
25%
SAIC GM Dong Yue Motors Co., Ltd. (SGM DY) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SAIC GM Dong Yue Motors Co., Ltd. (SGM DY) 25%
SAIC GM Dong Yue Powertrain Co., Ltd. (SGM DYPT) . . . . . . . . . . . . . . . . . . . . . . . . .
25%
SAIC GM Dong Yue Powertrain Co., Ltd. (SGM DYPT) 25%
FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM)(a) . . . . . . . . . . . . . . . . .
—%
FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM)(a) —%
Other joint ventures
Other joint ventures
SAIC-GMAC Automotive Finance Company Limited (SAIC-GMAC) . . . . . . . . . . . . . .
35%
SAIC-GMAC Automotive Finance Company Limited (SAIC-GMAC)
35%
35%
SAIC-GMF Leasing Co., Ltd.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SAIC-GMF Leasing Co., Ltd 35%
________
In 2019, we divested our joint venture FAW-GM.
(a) In 2019, we divested our joint venture FAW-GM.
(a)
50%
50%
50%
50%
49%
49%
44%
44%
40%
40%
25%
25%
25%
25%
25%
25%
50%
50%
35%
35%
35%
35%
SGM is a joint venture we established with Shanghai Automotive Industry Corporation (SAIC) (50%). SGM has interests in
SGM is a joint venture we established with Shanghai Automotive Industry Corporation (SAIC) (50%). SGM has interests in
three other joint ventures in China: SGM Norsom, SGM DY and SGM DYPT. These three joint ventures are jointly held by SGM
three other joint ventures in China: SGM Norsom, SGM DY and SGM DYPT. These three joint ventures are jointly held by SGM
(50%), SAIC (25%) and ourselves. These four joint ventures are engaged in the production, import and sale of a range of products
(50%), SAIC (25%) and ourselves. These four joint ventures are engaged in the production, import and sale of a range of products
under the Buick, Chevrolet and Cadillac brands. SGM also has interests in Shanghai OnStar (20%), SAIC-GMAC (20%) and
under the Buick, Chevrolet and Cadillac brands. SGM also has interests in Shanghai OnStar (20%), SAIC-GMAC (20%) and
SAIC-GMF Leasing Co., Ltd. (20%). Shanghai Automotive Group Finance Company Ltd., a subsidiary of SAIC, owns 45% of
SAIC-GMF Leasing Co., Ltd. (20%). Shanghai Automotive Group Finance Company Ltd., a subsidiary of SAIC, owns 45% of
SAIC-GMAC. SAIC Financial Holdings Company, a subsidiary of SAIC, owns 45% of SAIC-GMF Leasing Co., Ltd.
SAIC-GMAC. SAIC Financial Holdings Company, a subsidiary of SAIC, owns 45% of SAIC-GMF Leasing Co., Ltd.
64
64
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Summarized Financial Data of Nonconsolidated Affiliates
Summarized Financial Data of Nonconsolidated Affiliates
December 31, 2019
December 31, 2018
December 31, 2019 Decembet 31, 2018
Automotive
Automotive
Automotive Automotive
Total
China JVs
China JVs
China JVs Others Total China A's Others Total
Others
Others
Total
Summarized Balance Sheet Data
Summarized Balance Sheet Data
Current assets . . . . . . . . . . . . . . . . . . . . $
32,740
13,319
Current assets $ 14,035 $ 13,319 $ 27,354 $ 16,506 $ 16,234 $ 32,740
Non-current assets . . . . . . . . . . . . . . . .
17,882
6,680
Non-current assets 14,484 6,680 21,164 14,012 3,870 17,882
Total assets . . . . . . . . . . . . . . . . . . . . . . $
50,622
19,999
Total assets $ 28,519 $ 19,999 $ 48,518 S 30,518 $ 20,104 $ 50,622
48,518
27,354
21,164
16,506
16,234
28,519
14,035
14,484
14,012
30,518
20,104
3,870
$
$
$
$
$
$
$
$
$
$
Current liabilities . . . . . . . . . . . . . . . . . $
35,559
11,588
Current liabilities $ 21,256 $ 11,588 $ 32,844 $ 21,574 $ 13,985 $ 35,559
Non-current liabilities . . . . . . . . . . . . .
4,515
5,017
Non-current liabilities 968 5,017 5,985 1,689 2,826 4,515
Total liabilities . . . . . . . . . . . . . . . . . . . $
40,074
16,605
Total liabilities $ 22,224 $ 16,605 $ 38,829 $ 23,263 $ 16,811 $ 40,074
13,985
38,829
32,844
21,574
21,256
22,224
23,263
16,811
1,689
5,985
2,826
968
$
$
$
$
$
$
$
$
$
$
Noncontrolling interests . . . . . . . . . . . . $
866
Noncontrolling interests S 847 $ 1 $ 848 $ 865 $ 1 $ 866
848
847
865
$
$
1
$
$
1
$
Years Ended December 31,
Years Ended December 31,
2019
2017
2018
2019 2018 2017
Summarized Operating Data
Summarized Operating Data
Automotive China JVs' net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
50,065
Automotive China JVs' net sales $ 39,123 $ 50,316 $ 50,065
2,542
Others' net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Others' net sales 1,815 1,721 2,542
Total net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
52,607
Total net sales $ 40,938 $ 52,037 $ 52,607
52,037
39,123
40,938
50,316
1,815
1,721
$
$
$
$
Automotive China JVs' net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
3,984
Automotive China JVs' net income 5 2,258 $ 3,992 $ 3,984
648
Others' net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Others' net income 477 536 648
Total net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,632
Total net income 2,735 $ 4,528 $ 4,632
3,992
2,258
2,735
4,528
536
477
$
$
$
$
Transactions with Nonconsolidated Affiliates Our nonconsolidated affiliates are involved in various aspects of the development,
Transactions with NonconsolidatedAffiliates Our nonconsolidated affiliates are involved in various aspects of the development,
production and marketing of trucks, crossovers, cars and automobile parts. We enter into transactions with certain nonconsolidated
production and marketing of trucks, crossovers, cars and automobile parts. We enter into transactions with certain nonconsolidated
affiliates to purchase and sell component parts and vehicles. The following tables summarize transactions with and balances related
affiliates to purchase and sell component parts and vehicles. The following tables summarize transactions with and balances related
to our nonconsolidated affiliates:
to our nonconsolidated affiliates:
Years Ended December 31,
Years Ended December 31,
2019
2017
2018
2019 2018 2017
Automotive sales and revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
923
Automotive sales and revenue $ 199 $ 406 $ 923
Automotive purchases, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
674
Automotive purchases, net $ 1,065 $ 1,155 $ 674
Dividends received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,000
Dividends received $ 1,852 $ 2,022 $ 2,000
Operating cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,321
Operating cash flows $ 913 $ 657 $ 2,321
1,155
1,852
1,065
2,022
199
913
406
657
$
$
$
$
$
$
$
$
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Accounts and notes receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
979
$
1,007
Accounts and notes receivable, net $ 1,007 $ 979
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
163
Accounts payable $ 369 $ 163
Undistributed earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,331
Undistributed earnings $ 2,118 $ 2,331
2,118
369
$
$
65
65
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 9. Property
Note 9. Property
Estimated
Estimated
Useful Lives in
Useful Lives in
Years
Years
December 31, 2019
December 31, 2019
1,302
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
1,302
Land $
9,705
Buildings and improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5-40
9,705
Buildings and improvements 5-40
29,814
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3-27
29,814
Machinery and equipment 3-27
23,586
1-13
Special tools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
23,586
Special tools 1-13
Construction in progress. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,042
Construction in progress 3,042
Total property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
67,449
Total property 67,449
(28,699)
Less: accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: accumulated depreciation (28,699)
Total property, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
38,750
Total property, net 38,750
$
December 31, 2018
December 31, 2018
$
1,349
$ 1,349
9,173
9,173
26,453
26,453
23,828
23,828
4,680
4,680
65,483
65,483
(26,725)
(26,725)
$
38,758
$ 38,758
The amount of capitalized software included in Property, net was $1.3 billion and $1.1 billion at December 31, 2019 and 2018.
The amount of capitalized software included in Property, net was $1.3 billion and $1.1 billion at December 31, 2019 and 2018.
The amount of interest capitalized and excluded from Automotive interest expense related to Property, net was insignificant in the
The amount of interest capitalized and excluded from Automotive interest expense related to Property, net was insignificant in the
years ended December 31, 2019, 2018 and 2017.
years ended December 31, 2019, 2018 and 2017.
Depreciation and amortization expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
6,541
Depreciation and amortization expense $ 6,541
Impairment charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
7
Impairment charges $ 7
Capitalized software amortization expense(a). . . . . . . . . . . . . . . . . . . . . . . . . $
452
Capitalized software amortization expense(a) $ 452
$
5,347
$ 5,347
$
466
$ 466
$
424
$ 424
$
4,966
$ 4.966
$
199
$ 199
$
459
$ 459
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
__________
(a) Included in depreciation and amortization expense.
(a) Included in depreciation and amortization expense.
Note 10. Goodwill and Intangible Assets
Note 10. Goodwill and Intangible Assets
Goodwill of $1.9 billion consisted of $1.4 billion recorded in GM Financial and $504 million included in Cruise at December 31,
Goodwill of $1.9 billion consisted of $1.4 billion recorded in GM Financial and $504 million included in Cruise at December 31,
2019 and 2018.
2019 and 2018.
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Gross
Gross
Carrying
Carrying
Amount
Amount
Technology and intellectual property. . . . . . . . . . . . $
734
Technology and intellectual property $ 734
4,298
Brands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Brands 4.298
Dealer network, customer relationships and other. .
966
966
Dealer network, customer relationships and other
5,998
Total intangible assets . . . . . . . . . . . . . . . . . . . . . . . $
Total intangible assets $ 5,998
Accumulated
Accumulated
Amortization
Amortization
533
$
$ 533
1,285
1,285
702
702
2,520
$
S 2.520
Net
Net
Carrying
Carrying
Amount
Amount
201
$
$ 201
3,013
3,013
264
264
$ 3,478
S 3.478
Gross
Gross
Carrying
Carrying
Amount
Amount
734
$
$ 734
4,299
4,299
968
968
6,001
$
$ 6,001
Accumulated
Accumulated
Amortization
Amortization
457
$
$ 457
1,165
1,165
661
661
2,283
$
$ 2.283
Net
Net
Carrying
Carrying
Amount
Amount
277
$
$ 277
3,134
3,134
307
307
$ 3,718
$ 3,718
Our amortization expense related to intangible assets was $202 million, $247 million, and $278 million in the years ended
Our amortization expense related to intangible assets was $202 million, $247 million, and $278 million in the years ended
December 31, 2019, 2018 and 2017.
December 31, 2019,2018 and 2017.
Amortization expense related to intangible assets is estimated to be approximately $160 million in each of the next five years.
Amortization expense related to intangible assets is estimated to be approximately $160 million in each of the next five years.
66
66
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Note 11. Variable Interest Entities
Note 11. Variable Interest Entities
GM Financial uses special purpose entities (SPEs) that are considered VIEs to issue variable funding notes to third party bank-
GM Financial uses special purpose entities (SPEs) that are considered VIEs to issue variable funding notes to third party bank-
sponsored warehouse facilities or asset-backed securities to investors in securitization transactions. The debt issued by these VIEs
sponsored warehouse facilities or asset-backed securities to investors in securitization transactions. The debt issued by these VIEs
is backed by finance receivables and leasing related assets transferred to the VIEs (Securitized Assets). GM Financial determined
is backed by fmance receivables and leasing related assets transferred to the VIEs (Securitized Assets). GM Financial determined
that it is the primary beneficiary of the SPEs because the servicing responsibilities for the Securitized Assets give GM Financial
that it is the primary beneficiary of the SPEs because the servicing responsibilities for the Securitized Assets give GM Financial
the power to direct the activities that most significantly impact the performance of the VIEs and the variable interests in the VIEs
the power to direct the activities that most significantly impact the performance of the VIEs and the variable interests in the VIEs
give GM Financial the obligation to absorb losses and the right to receive residual returns that could potentially be significant.
give GM Financial the obligation to absorb losses and the right to receive residual returns that could potentially be significant.
The assets serve as the sole source of repayment for the debt issued by these entities. Investors in the notes issued by the VIEs do
The assets serve as the sole source of repayment for the debt issued by these entities. Investors in the notes issued by the VIEs do
not have recourse to GM Financial or its other assets, with the exception of customary representation and warranty repurchase
not have recourse to GM Financial or its other assets, with the exception of customary representation and warranty repurchase
provisions and indemnities that GM Financial provides as the servicer. GM Financial is not required and does not currently intend
provisions and indemnities that GM Financial provides as the servicer. GM Financial is not required and does not currently intend
to provide additional financial support to these SPEs. While these subsidiaries are included in GM Financial's consolidated financial
to provide additional fmancial support to these SPEs. While these subsidiaries are included in GM Financial's consolidated fmancial
statements, they are separate legal entities and their assets are legally owned by them and are not available to GM Financial's
statements, they are separate legal entities and their assets are legally owned by them and are not available to GM Financial's
creditors.
creditors.
a
The following table summarizes the assets and liabilities related to GM Financial's consolidated VIEs:
The following table summarizes the assets and liabilities related to GM Financial's consolidated VIEs:
–
–
December 31, 2019
December 31, 2019
Restricted cash – current
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,202
Restricted cash - current $ 2,202
Restricted cash – non-current
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
441
Restricted cash - non-current $ 441
GM Financial receivables, net of fees – current
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
19,081
GM Financial receivables, net of fees - current $ 19,081
GM Financial receivables, net of fees – non-current
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
15,921
GM Financial receivables, net of fees - non-current $ 15,921
GM Financial equipment on operating leases, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
14,464
GM Financial equipment on operating leases, net $ 14,464
GM Financial short-term debt and current portion of long-term debt . . . . . . . . . . . . . . . . $
23,952
GM Financial short-term debt and current portion of long-term debt $ 23,952
GM Financial long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
15,819
GM Financial long-term debt $ 15,819
–
–
December 31, 2018
December 31, 2018
$
1,876
$ 1,876
$
504
$ 504
$
18,304
$ 18,304
$
14,008
$ 14,008
$
21,781
$ 21,781
$
21,087
$ 21,087
$
21,417
$ 21,417
GM Financial recognizes finance charge, leased vehicle and fee income on the Securitized Assets and interest expense on the
GM Financial recognizes finance charge, leased vehicle and fee income on the Securitized Assets and interest expense on the
secured debt issued in a securitization transaction and records a provision for loan losses to recognize probable loan losses inherent
secured debt issued in a securitization transaction and records a provision for loan losses to recognize probable loan losses inherent
in the finance receivables.
in the finance receivables.
Note 12. Accrued and Other Liabilities
Note 12. Accrued and Other Liabilities
Accrued liabilities
Accrued liabilities
Dealer and customer allowances, claims and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . . $
10,402
Dealer and customer allowances, claims and discounts $ 10,402
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,234
Deferred revenue 3,234
Product warranty and related liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,987
Product warranty and related liabilities 2,987
1,969
Payrolls and employee benefits excluding postemployment benefits . . . . . . . . . . . . . . . .
1,969
Payrolls and employee benefits excluding postemployment benefits
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,895
Other 7,895
26,487
Total accrued liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total accrued liabilities $ 26,487
$
11,611
$ 11,611
3,504
3,504
2,788
2,788
2,233
2,233
7,913
7,913
28,049
$
$ 28,049
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Other liabilities
Other liabilities
Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,962
Deferred revenue 2,962
Product warranty and related liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Product warranty and related liabilities 4,811
4,811
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,010
Operating lease liabilities 1,010
Employee benefits excluding postemployment benefits . . . . . . . . . . . . . . . . . . . . . . . . . .
Employee benefits excluding postemployment benefits 704
704
Postemployment benefits including facility idling reserves. . . . . . . . . . . . . . . . . . . . . . . .
Postemployment benefits including facility idling reserves 633
633
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,026
Other 3,026
Total other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
13,146
Total other liabilities 13,146
$
2,959
$ 2,959
4,802
4,802
—
658
658
875
875
3,063
3,063
$
12,357
$ 12,357
67
67
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Product Warranty and Related Liabilities
Product Warranty and Related Liabilities
7,590
Warranty balance at beginning of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Warranty balance at beginning of period $ 7.590
Warranties issued and assumed in period – recall campaigns. . . . . . . . . . . . .
745
Warranties issued and assumed in period — recall campaigns 745
Warranties issued and assumed in period – product warranty. . . . . . . . . . . . .
2,001
Warranties issued and assumed in period — product warranty 2.001
(3,012)
Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Payments (3.012)
Adjustments to pre-existing warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
455
Adjustments to pre-existing warranties 455
Effect of foreign currency and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19
Effect of foreign currency and other 19
Warranty balance at end of period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
7,798
Warranty balance at end of period $ 7,798
8,332
$
$ 8,332
665
665
2,143
2,143
(2,903)
(2,903)
(464)
(464)
(183)
(183)
$
7,590
$ 7,590
9,069
$
$ 9,069
678
678
2,123
2,123
(3,129)
(3,129)
(495)
(495)
86
86
$
8,332
$ 8,332
We estimate our reasonably possible loss in excess of amounts accrued for recall campaigns to be insignificant at December 31,
We estimate our reasonably possible loss in excess of amounts accrued for recall campaigns to be insignificant at December 31,
2019. Refer to Note 16 for reasonably possible losses on Takata matters.
2019. Refer to Note 16 for reasonably possible losses on Takata matters.
Note 13. Debt
Note 13. Debt
Automotive The following table presents debt in our automotive operations:
Automotive The following table presents debt in our automotive operations:
December 31, 2019
December 31, 2019
Secured debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
167
Secured debt $ 167
Unsecured debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13,909
Unsecured debt 13,909
Finance lease liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
310
Finance lease liabilities 310
Total automotive debt(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
14,386
Total automotive debt(a) 14,386
December 31, 2018
December 31, 2018
$
143
$ 143
13,292
13,292
528
528
$
13,963
$ 13,963
Fair value utilizing Level 1 inputs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
13,628
Fair value utilizing Level 1 inputs 13,628
Fair value utilizing Level 2 inputs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,300
Fair value utilizing Level 2 inputs 2,300
Fair value of automotive debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
15,928
Fair value of automotive debt 15,928
$
11,693
$ 11,693
1,838
1,838
$
13,531
$ 13,531
Available under credit facility agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
17,285
Available under credit facility agreements $ 17,285
Weighted-average interest rate on outstanding short-term debt(b). . . . . . . . . . . . . . . . . . .
4.9%
Weighted-average interest rate on outstanding short-term debt(b) 4.9%
Weighted-average interest rate on outstanding long-term debt(b) . . . . . . . . . . . . . . . . . . .
5.4%
Weighted-average interest rate on outstanding long-term debt(b) 5.4%
$
14,167
$ 14,167
6.6%
6.6%
5.2%
5.2%
__________
(a) Includes net discount and debt issuance costs of $540 million and $499 million at December 31, 2019 and 2018.
(a) Includes net discount and debt issuance costs of $540 million and $499 million at December 31, 2019 and 2018.
(b) Includes coupon rates on debt denominated in various foreign currencies and interest free loans.
(b) Includes coupon rates on debt denominated in various foreign currencies and interest free loans.
Finance lease assets in Property, net were $327 million at December 31, 2019. Finance lease costs were $170 million in the year
Finance lease assets in Property, net were $327 million at December 31, 2019. Finance lease costs were $170 million in the year
ended December 31, 2019. Finance lease right of use assets obtained in exchange for lease obligations were $196 million in the
ended December 31, 2019. Finance lease right of use assets obtained in exchange for lease obligations were $196 million in the
year ended December 31, 2019. Undiscounted future lease obligations related to finance leases are $129 million for the year 2020,
year ended December 31,2019. Undiscounted future lease obligations related to finance leases are $129 million for the year 2020,
$156 million in aggregate for the years 2021 to 2024 and $354 million thereafter, with imputed interest of $329 million at
$156 million in aggregate for the years 2021 to 2024 and $354 million thereafter, with imputed interest of $329 million at
December 31, 2019. The weighted-average discount rate on finance leases was 10.9% and the weighted-average remaining lease
December 31, 2019. The weighted-average discount rate on fmance leases was 10.9% and the weighted-average remaining lease
term was 13.7 years at December 31, 2019. Payments for finance leases included in Net cash provided by (used in) financing
term was 13.7 years at December 31, 2019. Payments for fmance leases included in Net cash provided by (used in) financing
activities were $183 million at December 31, 2019.
activities were $183 million at December 31, 2019.
In January 2019 we executed a new three-year committed unsecured revolving credit facility with an initial borrowing capacity
In January 2019 we executed a new three-year committed unsecured revolving credit facility with an initial borrowing capacity
of $3.0 billion, reducing to $2.0 billion in July 2020. The facility provides additional financial flexibility and was used in 2019 to
of $3.0 billion, reducing to $2.0 billion in July 2020. The facility provides additional fmancial flexibility and was used in 2019 to
fund transformation activities announced in November 2018 for $700 million, which we repaid in full in 2019. In April 2019 we
fund transformation activities announced in November 2018 for $700 million, which we repaid in full in 2019. In April 2019 we
renewed our 364-day $2.0 billion credit facility for an additional 364-day term. This facility has been allocated for exclusive use
renewed our 364-day $2.0 billion credit facility for an additional 364-day term. This facility has been allocated for exclusive use
by GM Financial since April 2018.
by GM Financial since April 2018.
68
68
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GM Financial The following table presents debt of GM Financial:
GM Financial The following table presents debt of GM Financial:
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Secured debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
39,959
Secured debt $ 39,959
Unsecured debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48,979
Unsecured debt 48,979
Total GM Financial debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
88,938
Total GM Financial debt $ 88,938
Carrying
Carrying
Amount
Amount
Fair Value
Fair Value
$
40,160
$ 40,160
50,239
50,239
$
90,399
$ 90,399
Carrying
Carrying
Amount
Amount
$
42,835
$ 42,835
48,153
48,153
$
90,988
$ 90,988
Fair value utilizing Level 2 inputs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88,481
Fair value utilizing Level 2 inputs $ 88,481
Fair value utilizing Level 3 inputs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,918
Fair value utilizing Level 3 inputs $ 1,918
$
$
Fair Value
Fair Value
$
42,835
$ 42,835
47,556
47,556
$
90,391
$ 90,391
$
88,305
$ 88,305
$
2,086
$ 2,086
Secured debt consists of revolving credit facilities and securitization notes payable. Most of the secured debt was issued by VIEs
Secured debt consists of revolving credit facilities and securitization notes payable. Most of the secured debt was issued by VIEs
and is repayable only from proceeds related to the underlying pledged Securitized Assets. Refer to Note 11 for additional information
and is repayable only from proceeds related to the underlying pledged Securitized Assets. Refer to Note 11 for additional information
on GM Financial's involvement with VIEs. GM Financial is required to hold certain funds in restricted cash accounts to provide
on GM Financial's involvement with VIEs. GM Financial is required to hold certain funds in restricted cash accounts to provide
additional collateral for borrowings under certain secured credit facilities. The weighted-average interest rate on secured debt was
additional collateral for borrowings under certain secured credit facilities. The weighted-average interest rate on secured debt was
2.95% at December 31, 2019. The revolving credit facilities have maturity dates ranging from 2020 to 2025 and securitization
2.95% at December 31, 2019. The revolving credit facilities have maturity dates ranging from 2020 to 2025 and securitization
notes payable have maturity dates ranging from 2020 to 2027. At the end of the revolving period, if not renewed, the debt of
notes payable have maturity dates ranging from 2020 to 2027. At the end of the revolving period, if not renewed, the debt of
revolving credit facilities will amortize over a defined period. In the year ended December 31, 2019 GM Financial entered into
revolving credit facilities will amortize over a defined period. In the year ended December 31, 2019 GM Financial entered into
new or renewed credit facilities with a total net additional borrowing capacity of $225 million, which had substantially the same
new or renewed credit facilities with a total net additional borrowing capacity of $225 million, which had substantially the same
terms as existing debt and GM Financial issued $16.2 billion in aggregate principal amount of securitization notes payable with
terms as existing debt and GM Financial issued $16.2 billion in aggregate principal amount of securitization notes payable with
an initial weighted average interest rate of 2.75% and maturity dates ranging from 2022 to 2027.
an initial weighted average interest rate of 2.75% and maturity dates ranging from 2022 to 2027.
rr
Unsecured debt consists of senior notes, credit facilities and other unsecured debt. Senior notes outstanding at December 31,
Unsecured debt consists of senior notes, credit facilities and other unsecured debt. Senior notes outstanding at December 31,
2019 are due beginning in 2020 through 2029 and have a weighted-average interest rate of 3.42%. In the year ended December
2019 are due beginning in 2020 through 2029 and have a weighted-average interest rate of 3.42%. In the year ended December
31, 2019 GM Financial issued $6.9 billion in aggregate principal amount of senior notes with an initial weighted average interest
31, 2019 GM Financial issued $6.9 billion in aggregate principal amount of senior notes with an initial weighted average interest
rate of 3.63% and maturity dates ranging from 2021 to 2029.
rate of 3.63% and maturity dates ranging from 2021 to 2029.
In January 2020 GM Financial issued $1.25 billion in senior notes with an interest rate of 2.90% due in 2025.
In January 2020 GM Financial issued $1.25 billion in senior notes with an interest rate of 2.90% due in 2025.
Each of the revolving credit facilities and the indentures governing GM Financial's notes contain terms and covenants including
Each of the revolving credit facilities and the indentures governinv, GM Financial's notes contain terms and covenants including
limitations on GM Financial's ability to incur certain liens.
limitations on GM Financial's ability to incur certain liens.
Unsecured credit facilities and other unsecured debt have original maturities of up to four years. The weighted-average interest
Unsecured credit facilities and other unsecured debt have original maturities of up to four years. The weighted-average interest
rate on these credit facilities and other unsecured debt was 4.73% at December 31, 2019.
rate on these credit facilities and other unsecured debt was 4.73% at December 31, 2019.
Automotive interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
782
Automotive interest expense 782
Automotive Financing - GM Financial interest expense. . . . . . . . . . . . . . . . .
3,641
Automotive Financing - GM Financial interest expense 3,641
Total interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,423
Total interest expense 4,423
$
655
$ 655
3,225
3,225
$
3,880
$ 3,880
$
575
$ 575
2,566
2,566
$
3,141
$ 3,141
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
69
69
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table summarizes contractual maturities including finance leases at December 31, 2019:
The following table summarizes contractual maturities including fmance leases at December 31, 2019:
Automotive
Automotive
1,912
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2020 $ 1,912
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
535
2021 535
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
70
2022 70
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,546
2023 1,546
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48
2024 48
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10,807
Thereafter 10.807
$
14,918
$ 14.918
Automotive
Automotive
Financing(a)
Fivauciug(a)
35,587
$
$ 35,587
20,690
20,690
11,763
11,763
7,038
7,038
5,795
5,795
8,160
8,160
$
89,033
$ 89,033
Total
Total
$
5
37,499
37,499
21,225
21,225
11,833
11,833
8,584
8,584
5,843
5,843
18,967
18,967
$
103,951
$ 103,951
________
(a) Secured debt, credit facilities and other unsecured debt are based on expected payoff date. Senior notes principal amounts are based on
(a) Secured debt, credit facilities and other unsecured debt are based on expected payoff date. Senior notes principal amounts are based on
maturity.
maturity.
Compliance with Debt Covenants Several of our loan facilities, including our revolving credit facilities, require compliance
Compliance with Debt Covenants Several of our loan facilities, including our revolving credit facilities, require compliance
with certain financial and operational covenants as well as regular reporting to lenders, including providing certain subsidiary rr
with certain fmancial and operational covenants as well as regular reporting to lenders, including providing certain subsidiary
financial statements. Certain of GM Financial’s secured debt agreements also contain various covenants, including maintaining
financial statements. Certain of GM Financial's secured debt agreements also contain various covenants, including maintaining
portfolio performance ratios as well as limits on deferment levels. GM Financial’s unsecured debt obligations contain covenants
portfolio performance ratios as well as limits on deferment levels. GM Financial's unsecured debt obligations contain covenants
including limitations on GM Financial's ability to incur certain liens. Failure to meet certain of these requirements may result in
including limitations on GM Financial's ability to incur certain liens. Failure to meet certain of these requirements may result in
a covenant violation or an event of default depending on the terms of the agreement. An event of default may allow lenders to
a covenant violation or an event of default depending on the terms of the agreement. An event of default may allow lenders to
declare amounts outstanding under these agreements immediately due and payable, to enforce their interests against collateral
declare amounts outstanding under these agreements immediately due and payable, to enforce their interests against collateral
pledged under these agreements or restrict our ability or GM Financial's ability to obtain additional borrowings. No technical
pledged under these agreements or restrict our ability or GM Financial's ability to obtain additional borrowings. No technical
defaults or covenant violations existed at December 31, 2019.
defaults or covenant violations existed at December 31, 2019.
Note 14. Derivative Financial Instruments
Note 14. Derivative Financial Instruments
Automotive The following table presents the notional amounts of derivative financial instruments in our automotive operations:
Automotive The following table presents the notional amounts of derivative fmancial instruments in our automotive operations:
Fair Value
Fair Value
Level
Level
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Derivatives not designated as hedges(a)
Derivatives not designated as hedges(a)
$
Foreign currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
5,075
$ 5,075
Foreign currency 2
806
Commodity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
806
Commodity 2
2
PSA Warrants(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
45
45
PSA Warrants(b) 2
Total derivative financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5,926
Total derivative fmancial instruments 5,926
$
$
2,710
$ 2.710
658
658
45
45
$
3,413
$ 3,413
__________
(a) The fair value of these derivative instruments at December 31, 2019 and 2018 and the gains/losses included in our consolidated income
(a) The fair value of these derivative instruments at December 31, 2019 and 2018 and the gains/losses included in our consolidated income
statements for the years ended December 31, 2019, 2018 and 2017 were insignificant, unless otherwise noted.
statements for the years ended December 31, 2019, 2018 and 2017 were insignificant, unless otherwise noted.
(b) The fair value of the PSA warrants located in Other assets was $964 million and $827 million at December 31, 2019 and 2018. We recorded
(b) The fair value of the PSA warrants located in Other assets was $964 million and $827 million at December 31,2019 and 2018. We recorded
gains in Interest income and other non-operating income, net of $154 million and $116 million for the years ended December 31, 2019 and
gains in Interest income and other non-operating income, net of $154 million and $116 million for the years ended December 31,2019 and
2018, and an insignificant amount for the year ended December 31, 2017.
2018, and an insignificant amount for the year ended December 31, 2017.
70
70
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GM Financial The following table presents the notional amounts of GM Financial's derivative financial instruments:
GM Financial The following table presents the notional amounts of GM Financial's derivative financial instruments:
l
Fair Value
Fair Value
Level
Level
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Notional
Notional
Fair Value
Fair Value
of Assets
of Assets
Fair Value
Fair Value
of Liabilities
of Liabilities
Notional
Notional
Fair Value
Fair Value
of Assets
of Assets
Fair Value
Fair Value
of Liabilities
of Liabilities
Derivatives designated as hedges(a)
Derivatives designated as hedges(a)
Fair value hedges
Fair value hedges
2
Interest rate swaps(b) . . . . . . . . . . . . . .
Interest rate swaps(b) 2
Foreign currency swaps . . . . . . . . . . . .
2
Foreign currency swaps 2
$ 9,458
(cid:28)(cid:15)(cid:23)(cid:24)(cid:27)
(cid:7)
(cid:20)(cid:15)(cid:26)(cid:28)(cid:25)
1,796
(cid:21)(cid:22)(cid:23)
(cid:7)
$ 234
22
(cid:21)(cid:21)
(cid:21)(cid:22)
(cid:7)
$ 23
(cid:26)(cid:20)
71
(cid:28)(cid:15)(cid:24)(cid:22)(cid:22)
(cid:7)
$ 9,533
(cid:20)(cid:15)(cid:27)(cid:21)(cid:28)
1,829
$ 42
(cid:23)(cid:21)
(cid:7)
(cid:22)(cid:26)
37
Cash flow hedges
Cash flow hedges
Interest rate swaps. . . . . . . . . . . . . . . . .
2
Interest rate swaps 2
Foreign currency swaps . . . . . . . . . . . .
2
Foreign currency swaps 2
Derivatives not designated as hedges(a)
Derivatives not designated as hedges(a)
Interest rate contracts. . . . . . . . . . . . . . . . .
2
Interest rate contracts 2
Total derivative financial instruments(c). .
Total derivative fmancial instruments(c). .
(cid:24)(cid:28)(cid:19)
590
(cid:23)(cid:15)(cid:23)(cid:21)(cid:28)
4,429
(cid:178)
(cid:23)(cid:19)
40
(cid:25)
6
(cid:20)(cid:20)(cid:28)
119
(cid:26)(cid:25)(cid:27)
768
(cid:21)(cid:15)(cid:19)(cid:26)(cid:24)
2,075
(cid:27)
8
(cid:23)(cid:22)
43
(cid:28)(cid:21)(cid:15)(cid:23)(cid:19)(cid:19)
92,400
(cid:7)(cid:20)(cid:19)(cid:27)(cid:15)(cid:25)(cid:26)(cid:22)
$108,673
(cid:22)(cid:23)(cid:19)
340
$
636
$ 636
(cid:28)(cid:28)(cid:15)(cid:25)(cid:25)(cid:25)
99,666
(cid:7)
(cid:7)(cid:20)(cid:20)(cid:22)(cid:15)(cid:27)(cid:26)(cid:20)
$ 519 $113,871
(cid:22)(cid:19)(cid:19)
300
(cid:24)(cid:20)(cid:28)
(cid:22)(cid:26)(cid:21)
372
$ 502
(cid:7)
(cid:24)(cid:19)(cid:21)
(cid:24)(cid:21)(cid:19)
520
$
869
$ 869
$ 231
(cid:7)
(cid:21)(cid:22)(cid:20)
(cid:25)(cid:19)
60
(cid:178)
(cid:24)(cid:27)
58
__________
(a) The gains/losses included in our consolidated income statements and statements of comprehensive income for the years ended December 31,
(a) The gains/losses included in our consolidated income statements and statements of comprehensive income for the years ended December 31,
2019, 2018 and 2017 were insignificant, unless otherwise noted. Amounts accrued for interest payments in a net receivable position are
2019, 2018 and 2017 were insignificant, unless otherwise noted. Amounts accrued for interest payments in a net receivable position are
included in Other assets. Amounts accrued for interest payments in a net payable position are included in Other liabilities.
included in Other assets. Amounts accrued for interest payments in a net payable position are included in Other liabilities.
(b) The gains included in GM Financial interest, operating, and other expenses were $355 million and an insignificant amount for the years
(b) The gains included in GM Financial interest, operating, and other expenses were $355 million and an insignificant amount for the years
ended December 31, 2019 and 2018.
ended December 31, 2019 and 2018.
(c) GM Financial held $210 million and an insignificant amount of collateral from counterparties available for netting against GM Financial's
(c) GM Financial held $210 million and an insignificant amount of collateral from counterparties available for netting against GM Financial's
asset positions, and posted an insignificant amount and $451 million of collateral to counterparties available for netting against GM Financial's
asset positions, and posted an insignificant amount and $451 million of collateral to counterparties available for netting against GM Financial's
liability positions at December 31, 2019 and 2018.
liability positions at December 31, 2019 and 2018.
The fair value for Level 2 instruments was derived using the market approach based on observable market inputs including
The fair value for Level 2 instruments was derived using the market approach based on observable market inputs including
quoted prices of similar instruments and foreign exchange and interest rate forward curves.
quoted prices of similar instruments and foreign exchange and interest rate forward curves.
The following amounts were recorded in the consolidated balance sheets related to items designated and qualifying as hedged
The following amounts were recorded in the consolidated balance sheets related to items designated and qualifying as hedged
items in fair value hedging relationships:
items in fair value hedging relationships:
December 31, 2019
December 31, 2018
December 31, 2019 December 31, 2018
Carrying Amount of
Carrying Amount of
Hedged Items
Hedged Items
Cumulative Amount of
Cumulative Amount of
Fair Value Hedging
Fair Value Hedging
Adjustments(a)
Adjustments(a)
Carrying Amount of
Carrying Amount of
Hedged Items
Hedged Items
Cumulative Amount of
Cumulative Amount of
Fair Value Hedging
Fair Value Hedging
Adjustments(a)
Adjustments(a)
GM Financial long-term debt(b) $
GM Financial long-term debt(b) $
20,397
459
20,397 $ (77) $ 17,923 $ 459
17,923
(77) $
$
$
__________
(a) Includes an insignificant amount and $247 million of amortization remaining on hedged items for which hedge accounting has been
(a) Includes an insignificant amount and $247 million of amortization remaining on hedged items for which hedge accounting has been
discontinued at December 31, 2019 and 2018.
discontinued at December 31, 2019 and 2018.
(b) The gains/losses for hedged items – interest rate swaps included in GM Financial interest, operating, and other expenses were a loss of
(b) The gains/losses for hedged items — interest rate swaps included in GM Financial interest, operating, and other expenses were a loss of
–
$569 million and an insignificant amount for the years ended December 31, 2019 and 2018.
$569 million and an insignificant amount for the years ended December 31, 2019 and 2018.
Note 15. Pensions and Other Postretirement Benefits
Note 15. Pensions and Other Postretirement Benefits
Employee Pension and Other Postretirement Benefit Plans
Employee Pension and Other Postretirement Benefit Plans
Defined Benefit Pension Plans Defined benefit pension plans covering eligible U.S. hourly employees (hired prior to October
Defined Benefit Pension Plans Defmed benefit pension plans covering eligible U.S. hourly employees (hired prior to October
2007) and Canadian hourly employees (hired prior to October 2016) generally provide benefits of negotiated, stated amounts for
2007) and Canadian hourly employees (hired prior to October 2016) generally provide benefits of negotiated, stated amounts for
each year of service and supplemental benefits for employees who retire with 30 years of service before normal retirement age.
each year of service and supplemental benefits for employees who retire with 30 years of service before normal retirement age.
The benefits provided by the defined benefit pension plans covering eligible U.S. (hired prior to January 1, 2001) and Canadian
The benefits provided by the defmed benefit pension plans covering eligible U.S. (hired prior to January 1, 2001) and Canadian
salaried employees and employees in certain other non-U.S. locations are generally based on years of service and compensation
salaried employees and employees in certain other non-U.S. locations are generally based on years of service and compensation
history. Accrual of defined pension benefits ceased in 2012 for U.S. and Canadian salaried employees. There is also an unfunded
history. Accrual of defmed pension benefits ceased in 2012 for U.S. and Canadian salaried employees. There is also an unfunded
nonqualified pension plan primarily covering U.S. executives for service prior to January 1, 2007 and it is based on an “excess
nonqualified pension plan primarily covering U.S. executives for service prior to January 1, 2007 and it is based on an "excess
plan” for service after that date.
plan" for service after that date.
71
71
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The funding policy for qualified defined benefit pension plans is to contribute annually not less than the minimum required by
The funding policy for qualified defined benefit pension plans is to contribute annually not less than the minimum required by
applicable laws and regulations or to directly pay benefit payments where appropriate. In the year ended December 31, 2019 all
applicable laws and regulations or to directly pay benefit payments where appropriate. In the year ended December 31, 2019 all
legal funding requirements were met. The following table summarizes contributions made to the defined benefit pension plans:
legal funding requirements were met. The following table summarizes contributions made to the defined benefit pension plans:
Years Ended December 31,
Years Ended December 31,
2019
2017
2018
2019 2018 2017
U.S. hourly and salaried . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
77
U.S. hourly and salaried S 83 $ 76 $ 77
Non-U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,153
Non-U.S 532 1,624 1,153
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,230
Total S 615 $ 1,700 $ 1,230
1,700
1,624
532
615
76
83
$
$
$
$
We expect to contribute approximately $70 million to our U.S. non-qualified plans and approximately $500 million to our non-
We expect to contribute approximately $70 million to our U.S. non-qualified plans and approximately $500 million to our non-
U.S. pension plans in 2020.
U.S. pension plans in 2020.
Based on our current assumptions, over the next five years we expect no significant mandatory contributions to our U.S. qualified
Based on our current assumptions, over the next five years we expect no significant mandatory contributions to our U.S. qualified
pension plans and mandatory contributions totaling $368 million to our U.K. and Canada pension plans.
pension plans and mandatory contributions totaling $368 million to our U.K. and Canada pension plans.
Other Postretirement Benefit Plans Certain hourly and salaried defined benefit plans provide postretirement medical, dental,
Other Postretirement Benefit Plans Certain hourly and salaried defined benefit plans provide postretirement medical, dental,
legal service and life insurance to eligible U.S. and Canadian retirees and their eligible dependents. Certain other non-U.S.
legal service and life insurance to eligible U.S. and Canadian retirees and their eligible dependents. Certain other non-U.S.
subsidiaries have postretirement benefit plans, although most non-U.S. employees are covered by government sponsored or
subsidiaries have postretirement benefit plans, although most non-U.S. employees are covered by government sponsored or
administered programs. We made contributions to the U.S. OPEB plans of $326 million, $325 million and $323 million in the
administered programs. We made contributions to the U.S. OPEB plans of $326 million, $325 million and $323 million in the
years ended December 31, 2019, 2018 and 2017. Plan participants' contributions were insignificant in the years ended December 31,
years ended December 31, 2019, 2018 and 2017. Plan participants' contributions were insignificant in the years ended December 31,
2019, 2018 and 2017.
2019, 2018 and 2017.
Defined Contribution Plans We have defined contribution plans for eligible U.S. salaried and hourly employees that provide
Defined Contribution Plans We have defined contribution plans for eligible U.S. salaried and hourly employees that provide
discretionary matching contributions. Contributions are also made to certain non-U.S. defined contribution plans. We made
discretionary matching contributions. Contributions are also made to certain non-U.S. defined contribution plans. We made
contributions to our defined contribution plans of $537 million, $617 million and $650 million in the years ended December 31,
contributions to our defined contribution plans of $537 million, $617 million and $650 million in the years ended December 31,
2019, 2018 and 2017.
2019, 2018 and 2017.
Significant Plan Amendments, Benefit Modifications and Related Events
Significant Plan Amendments, Benefit Modifications and Related Events
Other Remeasurements The SOA issued mortality improvement tables in the three months ended December 31, 2019. We
Other Remeasurements The SOA issued mortality improvement tables in the three months ended December 31, 2019. We
determined our current mortality improvement assumptions are appropriate to measure our December 31, 2019 U.S. pension and
determined our current mortality improvement assumptions are appropriate to measure our December 31, 2019 U.S. pension and
OPEB plans obligations. In 2018 we reviewed our mortality experience and updated our base mortality assumptions in the U.S.
OPEB plans obligations. In 2018 we reviewed our mortality experience and updated our base mortality assumptions in the U.S.
This change in assumption decreased the December 31, 2018 U.S. pension and OPEB plans' obligations by $264 million.
This change in assumption decreased the December 31, 2018 U.S. pension and OPEB plans' obligations by $264 million.
72
72
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Pension and OPEB Obligations and Plan Assets
Pension and OPEB Obligations and Plan Assets
Pension Benefits
Pension Benefits
Year Ended December 31, 2019
Year Ended December 31, 2019
Global
Global
OPEB
OPEB
Plans
Plans
Plans
Non-U.S.
Non-U.S.
U.S.
U.S.
Pension Benefits
Pension Benefits
Year Ended December 31, 2018
Year Ended December 31, 2018
Global
Global
OPEB
OPEB
Plans
Plans
Non-U.S.
Non-U.S.
U.S.
U.S.
Change in benefit obligations
Change in benefit obligations
Beginning benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 61,190
Beginning benefit obligation $ 61,190
$ 19,904
$ 19,904
$
5,744
$ 5,744
$ 68,450
$ 68,450
$ 22,789
$ 22,789
$ 6,374
$ 6,374
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
179
Service cost 179
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,264
Interest cost 2,264
120
120
456
456
Actuarial (gains) losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,444
Actuarial (gains) losses 6,444
1,653
1,653
17
17
220
220
641
641
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4,753)
Benefits paid (4,753)
(1,234)
(1,234)
(395)
(395)
Foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . .
561
Foreign currency translation adjustments 561
—
Curtailments, settlements and other . . . . . . . . . . . . . . . . . . . . . . . .
(640)
Curtailments, settlements and other (640)
(62)
(62)
54
54
23
23
209
209
2,050
2,050
(4,449)
(4,449)
(4,898)
(4,898)
—
(172)
(172)
149
149
464
464
(272)
(272)
(1,595)
(1,595)
(1,452)
(1,452)
(179)
(179)
20
20
195
195
(389)
(389)
(388)
(388)
(106)
(106)
38
38
Ending benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64,684
Ending benefit obligation 64.684
21,398
21,398
6,304
6,304
61,190
61.190
19,904
19,904
5,744
5,744
Change in plan assets
Change in plan assets
Beginning fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . .
56,102
Beginning fair value of plan assets 56,102
13,528
13,528
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,454
Actual return on plan assets 8,454
Employer contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
83
Employer contributions 83
1,669
1,669
532
532
—
—
370
370
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4,753)
Benefits paid (4,753)
(1,234)
(1,234)
(395)
(395)
(4,898)
(4,898)
Foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . .
668
Foreign currency translation adjustments 668
—
Settlements and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(647)
Settlements and other (647)
(202)
(202)
Ending fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
59,239
Ending fair value of plan assets 59,239
14,961
14,961
—
25
25
—
62,639
62,639
14,495
14,495
(1,419)
(1,419)
76
76
—
(296)
(296)
301
301
1,624
1,624
(1,595)
(1,595)
(1,106)
(1,106)
(191)
(191)
56,102
56,102
13,528
13,528
—
—
369
369
(388)
(388)
—
19
19
—
Ending funded status. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(6,376) $ (5,744)
Ending funded status $ (5,445) $ (6,437) $ (6,304) $ (5,088) $ (6,376) $ (5,744)
(6,437) $ (6,304) $
(5,445) $
(5,088) $
Amounts recorded in the consolidated balance sheets
Amounts recorded in the consolidated balance sheets
Non-current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
698
Non-current assets $ - $ 698
— $
$
496
$ - $ - $ 496
— $
— $
$
—
$ -
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(68)
Current liabilities (68)
(342)
(342)
(369)
(369)
(73)
(73)
(349)
(349)
(374)
(374)
Non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5,377)
Non-current liabilities (5,377)
(6,793)
(6,793)
(5,935)
(5,935)
(5,015)
(5,015)
(6,523)
(6,523)
(5,370)
(5,370)
Net amount recorded. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(6,376) $ (5,744)
Net amount recorded $ (5,445) $ (6,437) $ (6,304) $ (5,088) $ (6,376) $ (5,744)
(6,437) $ (6,304) $
(5,445) $
(5,088) $
Amounts recorded in Accumulated other comprehensive loss
Amounts recorded in Accumulated other comprehensive loss
Net actuarial loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(752)
Net actuarial loss $ (1,980) $ (4,688) $ (1,364) $ (752) $ (3,983) $ (752)
(4,688) $ (1,364) $
(1,980) $
(3,983) $
(752) $
Net prior service (cost) credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
Net prior service (cost) credit 14
(78)
(78)
27
27
19
19
(64)
(64)
34
34
Total recorded in Accumulated other comprehensive loss . . . . . . . $
(718)
Total recorded in Accumulated other comprehensive loss $ (1.966) $ (4,766) $ (1,337) $ (733) $ (4,047) $ (718)
(4,766) $ (1,337) $
(1,966) $
(4,047) $
(733) $
The following table summarizes the total accumulated benefit obligations (ABO), the ABO and fair value of plan assets for
The following table summarizes the total accumulated benefit obligations (ABO), the ABO and fair value of plan assets for
defined benefit pension plans with ABO in excess of plan assets, and the PBO and fair value of plan assets for defined benefit
defmed benefit pension plans with ABO in excess of plan assets, and the PBO and fair value of plan assets for defmed benefit
pension plans with PBO in excess of plan assets:
pension plans with PBO in excess of plan assets:
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
U.S.
U.S.
ABO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
64,669
ABO $ 64,669
Plans with ABO in excess of plan assets
Plans with ABO in excess of plan assets
ABO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
64,669
ABO $ 64,669
59,239
Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Fair value of plan assets $ 59,239
Plans with PBO in excess of plan assets
Plans with PBO in excess of plan assets
PBO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
64,684
PBO $ 64,684
Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
59,239
Fair value of plan assets $ 59,239
Non-U.S.
Non-U.S.
$
21,319
$ 21,319
U.S.
U.S.
$
61,177
$ 61,177
Non-U.S.
Non-U.S.
$
19,822
$ 19,822
$
10,996
$ 10,996
$
3,940
$ 3,940
$
61,177
$ 61,177
$
56,102
$ 56,102
$
10,289
$ 10,289
$
3,485
$ 3,485
$
11,079
$ 11,079
$
3,940
$ 3,940
$
61,190
$ 61,190
$
56,102
$ 56,102
$
10,356
$ 10,356
$
3,485
$ 3,485
73
73
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table summarizes the components of net periodic pension and OPEB expense along with the assumptions used
The following table summarizes the components of net periodic pension and OPEB expense along with the assumptions used
to determine benefit obligations:
to determine benefit obligations:
Components of expense
Components of expense
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
393
Service cost $ 393
$
132
$ 132
$
17
$ 17
$
330
$ 330
$
163
$ 163
$
20
$ 20
$
315
$ 315
$
199
$ 199
$
19
$ 19
Year Ended December 31, 2019
Year Ended December 31, 2019
Year Ended December 31, 2018
Year Ended December 31, 2018
Year Ended December 31, 2017
Year Ended December 31, 2017
Pension Benefits
Pension Benefits
U.S.
U.S.
Non-U.S.
Non-U.S.
Global
Global
OPEB
OPEB
Plans
Plans
Plans
Pension Benefits
Pension Benefits
U.S.
U.S.
Non-U.S.
Non-U.S.
Global
Global
OPEB
OPEB
Plans
Plans
Plans
Pension Benefits
Pension Benefits
U.S.
U.S.
Non-U.S.
Non-U.S.
Global
Global
OPEB
OPEB
Plans
Plans
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,264
Interest cost 2,264
Expected return on plan assets . . . . . . . . . . . . . . . . . . . .
(3,483)
Expected return on plan assets (3,483)
Amortization of net actuarial (gains) losses . . . . . . . . . .
11
Amortization of net actuarial (gains) losses 11
Curtailments, settlements and other . . . . . . . . . . . . . . . .
21
Curtailments, settlements and other 21
456
456
(786)
(786)
122
122
142
142
220
220
—
30
30
(23)
(23)
2,050
2,050
(3,890)
(3,890)
10
10
(19)
(19)
464
464
(825)
(825)
144
144
43
43
195
195
—
54
54
(19)
(19)
2,145
2,145
(3,677)
(3,677)
(6)
(6)
(37)
(37)
473
473
(750)
(750)
157
157
8
8
$
66
$ 66
$ 244
$ 244
$(1,519)
$(1,519)
$
(11)
$ (11)
$ 250
$ 250
$(1,260)
$(1,260)
$
87
$ 87
202
202
—
23
23
(5)
(5)
$ 239
$ 239
Net periodic pension and OPEB (income) expense . . . . $ (794)
$ (794)
Net periodic pension and OPEB (income) expense . . .
Weighted-average assumptions used to determine
Weighted-average assumptions used to determine
benefit obligations(a)
benefit obligations(a)
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.20%
Discount rate 3.20%
Weighted-average assumptions used to determine
Weighted-average assumptions used to determine
net expense(a)
net expense(a)
2.16%
2.16%
3.24%
3.24%
4.22%
4.22%
2.86%
2.86%
4.19%
4.19%
3.53%
3.53%
2.66%
2.66%
3.52%
3.52%
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3.92%
Discount rate 3.92%
3.36%
3.36%
4.07%
4.07%
Expected rate of return on plan assets. . . . . . . . . . . . . . .
6.37%
Expected rate of return on plan assets 6.37%
5.76%
5.76%
N/A
N/A
3.19%
3.19%
6.61%
6.61%
2.99%
2.99%
3.29%
3.29%
6.09%
6.09%
N/A
N/A
3.35%
3.35%
6.23%
6.23%
2.94%
2.94%
3.39%
3.39%
5.82%
5.82%
N/A
N/A
_________
(a) The rate of compensation increase does not have a significant effect on our U.S. pension and OPEB plans.
(a) The rate of compensation increase does not have a significant effect on our U.S. pension and OPEB plans.
The non-service cost components of the net periodic pension and OPEB income are presented in Interest income and other non-
The non-service cost components of the net periodic pension and OPEB income are presented in Interest income and other non-
operating income, net. Refer to Note 19 for additional information.
operating income, net. Refer to Note 19 for additional information.
U.S. pension plan service cost includes administrative expenses and Pension Benefit Guarantee Corporation premiums of $214
U.S. pension plan service cost includes administrative expenses and Pension Benefit Guarantee Corporation premiums of $214
million and $121 million for the years ended December 31, 2019 and 2018. Weighted-average assumptions used to determine net
million and $121 million for the years ended December 31, 2019 and 2018. Weighted-average assumptions used to determine net
expense are determined at the beginning of the period and updated for remeasurements. Non-U.S. pension plan administrative
expense are determined at the beginning of the period and updated for remeasurements. Non-U.S. pension plan administrative
expenses included in service cost were insignificant in the years ended December 31, 2019 and 2018.
expenses included in service cost were insignificant in the years ended December 31, 2019 and 2018.
Estimated amounts to be amortized from Accumulated other comprehensive loss into net periodic benefit cost in the year ending
Estimated amounts to be amortized from Accumulated other comprehensive loss into net periodic benefit cost in the year ending
December 31, 2020 based on December 31, 2019 plan measurements are $258 million, primarily consisting of amortization of the
December 31, 2020 based on December 31, 2019 plan measurements are $258 million, primarily consisting of amortization of the
net actuarial loss in the non-U.S. pension plans.
net actuarial loss in the non-U.S. pension plans.
Assumptions
Assumptions
Investment Strategies and Long-Term Rate of Return Detailed periodic studies are conducted by our internal asset management
Investment Strategies and Long-Term Rate of Return Detailed periodic studies are conducted by our internal asset management
group as well as outside actuaries and are used to determine the long-term strategic mix among asset classes, risk mitigation
group as well as outside actuaries and are used to determine the long-term strategic mix among asset classes, risk mitigation
strategies and the expected long-term return on asset assumptions for the U.S. pension plans. The U.S. study includes a review of
strategies and the expected long-term return on asset assumptions for the U.S. pension plans. The U.S. study includes a review of
alternative asset allocation and risk mitigation strategies, anticipated future long-term performance and risk of the individual asset
alternative asset allocation and risk mitigation strategies, anticipated future long-term performance and risk of the individual asset
classes that comprise the plans' asset mix. Similar studies are performed for the significant non-U.S. pension plans with the
classes that comprise the plans' asset mix. Similar studies are performed for the significant non-U.S. pension plans with the
assistance of outside actuaries and asset managers. While the studies incorporate data from recent plan performance and historical
assistance of outside actuaries and asset managers. While the studies incorporate data from recent plan performance and historical
returns, the expected rate of return on plan assets represents our estimate of long-term prospective rates of return.
returns, the expected rate of return on plan assets represents our estimate of long-term prospective rates of return.
We continue to pursue various options to fund and de-risk our pension plans, including continued changes to the pension asset
We continue to pursue various options to fund and de-risk our pension plans, including continued changes to the pension asset
portfolio mix to reduce funded status volatility. The strategic asset mix and risk mitigation strategies for the plans are tailored
portfolio mix to reduce funded status volatility. The strategic asset mix and risk mitigation strategies for the plans are tailored
specifically for each plan. Individual plans have distinct liabilities, liquidity needs and regulatory requirements. Consequently
specifically for each plan. Individual plans have distinct liabilities, liquidity needs and regulatory requirements. Consequently
there are different investment policies set by individual plan fiduciaries. Although investment policies and risk mitigation strategies
there are different investment policies set by individual plan fiduciaries. Although investment policies and risk mitigation strategies
may differ among plans, each investment strategy is considered to be appropriate in the context of the specific factors affecting
may differ among plans, each investment strategy is considered to be appropriate in the context of the specific factors affecting
each plan.
each plan.
tt
In setting new strategic asset mixes, consideration is given to the likelihood that the selected asset mixes will effectively fund
In setting new strategic asset mixes, consideration is given to the likelihood that the selected asset mixes will effectively fund
the projected pension plan liabilities, while aligning with the risk tolerance of the plans' fiduciaries. The strategic asset mixes for
the projected pension plan liabilities, while aligning with the risk tolerance of the plans' fiduciaries. The strategic asset mixes for
U.S. defined benefit pension plans are increasingly designed to satisfy the competing objectives of improving funded positions
U.S. defined benefit pension plans are increasingly designed to satisfy the competing objectives of improving funded positions
ff
74
74
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(market value of assets equal to or greater than the present value of the liabilities) and mitigating the possibility of a deterioration
(market value of assets equal to or greater than the present value of the liabilities) and mitigating the possibility of a deterioration
in funded status.
in funded status.
Derivatives may be used to provide cost effective solutions for rebalancing investment portfolios, increasing or decreasing
Derivatives may be used to provide cost effective solutions for rebalancing investment portfolios, increasing or decreasing
exposure to various asset classes and for mitigating risks, primarily interest rate, equity and currency risks. Equity and fixed income
exposure to various asset classes and for mitigating risks, primarily interest rate, equity and currency risks. Equity and fixed income
managers are permitted to utilize derivatives as efficient substitutes for traditional securities. Interest rate derivatives may be used
managers are permitted to utilize derivatives as efficient substitutes for traditional securities. Interest rate derivatives may be used
to adjust portfolio duration to align with a plan's targeted investment policy and equity derivatives may be used to protect equity
to adjust portfolio duration to align with a plan's targeted investment policy and equity derivatives may be used to protect equity
positions from downside market losses. Alternative investment managers are permitted to employ leverage, including through the
positions from downside market losses. Alternative investment managers are permitted to employ leverage, including through the
use of derivatives, which may alter economic exposure.
use of derivatives, which may alter economic exposure.
qq
aa
In December 2019, an investment policy study was completed for the U.S. pension plans. As a result of changes to our capital
In December 2019, an investment policy study was completed for the U.S. pension plans. As a result of changes to our capital
market assumptions, the weighted-average long-term rate of return on assets decreased from 6.4% at December 31, 2018 to 5.9%
market assumptions, the weighted-average long-term rate of return on assets decreased from 6.4% at December 31, 2018 to 5.9%
at December 31, 2019. The expected long-term rate of return on plan assets used in determining pension expense for non-U.S.
at December 31, 2019. The expected long-term rate of return on plan assets used in determining pension expense for non-U.S.
plans is determined in a similar manner to the U.S. plans.
plans is determined in a similar manner to the U.S. plans.
Target Allocation Percentages The following table summarizes the target allocations by asset category for U.S. and non-U.S.
Target Allocation Percentages The following table summarizes the target allocations by asset category for U.S. and non-U.S.
defined benefit pension plans:
defined benefit pension plans:
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
U.S.
U.S.
Non-U.S.
Non-U.S.
U.S.
U.S.
Non-U.S.
Non-U.S.
Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12%
Equity 12%
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64%
Debt 64%
Other(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
24%
Other(a) 24%
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100%
Total 100%
14%
14%
67%
67%
19%
19%
100%
100%
12%
12%
64%
64%
24%
24%
100%
100%
14%
14%
66%
66%
20%
20%
100%
100%
__________
(a) Primarily includes private equity, real estate and absolute return strategies which mainly consist of hedge funds.
(a) Primarily includes private equity, real estate and absolute return strategies which mainly consist of hedge funds.
75
75
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Assets and Fair Value Measurements The following tables summarize the fair value of U.S. and non-U.S. defined benefit
Assets and Fair Value Measurements The following tables summarize the fair value of U.S. and non-U.S. defined benefit
pension plan assets by asset class:
pension plan assets by asset class:
December 31, 2019
December 31, 2019
Level 3
Level 2
Level 3
Level 2
Level 1
Level 1
Total
Total
Level 1
Level 1
December 31, 2018
December 31, 2018
Level 3
Level 2
Level 3
Level 2
Total
Total
U.S. Pension Plan Assets
U.S. Pension Plan Assets
$ 19
Common and preferred stocks $ 6,232
Common and preferred stocks. . . . . . . . . . . . . . . . . . . . . . . $ 6,232
$
19
13,843
Government and agency debt securities(a) -
— 13,843
Government and agency debt securities(a) . . . . . . . . . . . . .
— 24,809
Corporate and other debt securities . . . . . . . . . . . . . . . . . . .
Corporate and other debt securities 24,809
25
Other investments, net(b) (47)
Other investments, net(b) . . . . . . . . . . . . . . . . . . . . . . . . . .
25
(47)
$ 38,696
Net plan assets subject to leveling $ 6,185
Net plan assets subject to leveling. . . . . . . . . . . . . . . . . . . . $ 6,185
$ 38,696
Plan assets measured at net asset value
Plan assets measured at net asset value
Investment funds 7,031
7,031
Investment funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,951
Private equity and debt investments
2,951
Private equity and debt investments . . . . . . . . . . . . . . . . . .
3,484
Real estate investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,484
Real estate investments
13,466
Total plan assets measured at net asset value
13,466
Total plan assets measured at net asset value . . . . . . . . . . .
490
Other plan assets, net(c)
490
Other plan assets, net(c). . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net plan assets
Net plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 59,239
$ 59,239
$ 6,252
$ 1
$ 6,252
$
1
13,843
-
— 13,843
— 24,809
24,809
-
379
401
379
401
45,283
$ 402
45,283
402
$
$ 4,934
$ 2
$ 4,914
$ 4,934
2
$ 4,914
$
$
18
$ 18
12,077
-
12,077
-
— 12,077
— 12,077
— 24,645
— 24,645
24,645
24,645
801
371
80
350
801
350
371
80
42,457
$ 36,820 $ 373
$ 5,264
42,457
$ 36,820
373
$ 5,264
$
6,465
6,465
3,021
3,021
3,504
3,504
12,990
12,990
655
655
$ 56,102
$ 56,102
December 31, 2019
December 31, 2019
Level 3 Total
Level 2
Level 2
Level 3
Total
Level 1
Level 1
December 31, 2018
December 31, 2018
Level 3
Level 2
Level 2
Level 3
Total
Total
Level 1
Level 1
Non-U.S. Pension Plan Assets
Non-U.S. Pension Plan Assets
Common and preferred stocks $ 489
Common and preferred stocks. . . . . . . . . . . . . . . . . . . . . . . $
$
1
489
$ 1
3,927
—
Government and agency debt securities(a) . . . . . . . . . . . . .
3,927
Government and agency debt securities(a) -
Corporate and other debt securities 3,230
3,230
—
Corporate and other debt securities . . . . . . . . . . . . . . . . . . .
(107)
Other investments, net(b)(d) (5)
(107)
Other investments, net(b)(d) . . . . . . . . . . . . . . . . . . . . . . . .
(5)
Net plan assets subject to leveling. . . . . . . . . . . . . . . . . . . . $
$ 7,051
484
$ 7,051
Net plan assets subject to leveling $ 484
Plan assets measured at net asset value
Plan assets measured at net asset value
Investment funds 5,608
5,608
Investment funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
511
Private equity and debt investments . . . . . . . . . . . . . . . . . .
511
Private equity and debt investments
982
Real estate investments
982
Real estate investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,101
Total plan assets measured at net asset value
7,101
Total plan assets measured at net asset value . . . . . . . . . . .
77
Other plan assets (liabilities), net(c) . . . . . . . . . . . . . . . . . .
77
Other plan assets (liabilities), net(c)
Net plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 14,961
Net plan assets
$ 14,961
490
$ — $
$ $ 490
—
3,927
3,927
3,230
3,230
—
248 136
248
136
$
7,783
248
$ 248 7,783
$
441
$ 441
—
—
59
59
500
$
$ 500
1
$
$ 1
3,640
3,640
2,589
2,589
128
128
$ 6,358
$ 6,358
$
5
$ 5
—
1
1
242
242
248
$
$ 248
447
$
$ 447
3,640
3,640
2,590
2,590
429
429
7,106
7,106
5,081
5,081
526
526
980
980
6,587
6,587
(165)
(165)
$ 13,528
$ 13,528
__________
(a) Includes U.S. and sovereign government and agency issues.
(a) Includes U.S. and sovereign government and agency issues.
(b) Includes net derivative assets (liabilities).
(b) Includes net derivative assets (liabilities).
(c) Cash held by the plans, net of amounts receivable/payable for unsettled security transactions and payables for investment manager fees,
(c) Cash held by the plans, net of amounts receivable/payable for unsettled security transactions and payables for investment manager fees,
custody fees and other expenses.
custody fees and other expenses.
(d) Level 2 Other investments, net includes Canadian reverse repurchase agreements.
(d) Level 2 Other investments, net includes Canadian reverse repurchase agreements.
The activity attributable to U.S. and non-U.S. Level 3 defined benefit pension plan investments was insignificant in the years
The activity attributable to U.S. and non-U.S. Level 3 defined benefit pension plan investments was insignificant in the years
ended December 31, 2019 and 2018.
ended December 31, 2019 and 2018.
Investment Fund Strategies Investment funds include hedge funds, funds of hedge funds, equity funds and fixed income funds.
Investment Fund Strategies Investment funds include hedge funds, funds of hedge funds, equity funds and fixed income funds.
Hedge funds and funds of hedge funds managers typically seek to achieve their objectives by allocating capital across a broad
Hedge funds and funds of hedge funds managers typically seek to achieve their objectives by allocating capital across a broad
array of funds and/or investment managers. Equity funds invest in U.S. common and preferred stocks as well as similar equity
array of funds and/or investment managers. Equity funds invest in U.S. common and preferred stocks as well as similar equity
securities issued by companies incorporated, listed or domiciled in developed and/or emerging market countries. Fixed income
securities issued by companies incorporated, listed or domiciled in developed and/or emerging market countries. Fixed income
funds include investments in high quality funds and, to a lesser extent, high yield funds. High quality fixed income funds invest
funds include investments in high quality funds and, to a lesser extent, high yield funds. High quality fixed income funds invest
in government securities, investment-grade corporate bonds and mortgage and asset-backed securities. High yield fixed income
in government securities, investment-grade corporate bonds and mortgage and asset-backed securities. High yield fixed income
funds invest in high yield fixed income securities issued by corporations which are rated below investment grade. Other investment
funds invest in high yield fixed income securities issued by corporations which are rated below investment grade. Other investment
funds also included in this category primarily represent multi-strategy funds that invest in broadly diversified portfolios of equity,
funds also included in this category primarily represent multi-strategy funds that invest in broadly diversified portfolios of equity,
fixed income and derivative instruments.
fixed income and derivative instruments.
76
76
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Private equity and debt investments primarily consist of investments in private equity and debt funds. These investments provide
Private equity and debt investments primarily consist of investments in private equity and debt funds. These investments provide
exposure to and benefit from long-term equity investments in private companies, including leveraged buy-outs, venture capital
exposure to and benefit from long-term equity investments in private companies, including leveraged buy-outs, venture capital
and distressed debt strategies.
and distressed debt strategies.
Real estate investments include funds that invest in entities which are primarily engaged in the ownership, acquisition,
Real estate investments include funds that invest in entities which are primarily engaged in the ownership, acquisition,
development, financing, sale and/or management of income-producing real estate properties, both commercial and residential.
development, fmancing, sale and/or management of income-producing real estate properties, both commercial and residential.
These funds typically seek long-term growth of capital and current income that is above average relative to public equity funds.
These funds typically seek long-term growth of capital and current income that is above average relative to public equity funds.
Significant Concentrations of Risk The assets of the pension plans include certain investment funds, private equity and debt
Significant Concentrations of Risk The assets of the pension plans include certain investment funds, private equity and debt
investments and real estate investments. Investment managers may be unable to quickly sell or redeem some or all of these
investments and real estate investments. Investment managers may be unable to quickly sell or redeem some or all of these
investments at an amount close or equal to fair value in order to meet a plan's liquidity requirements or to respond to specific
investments at an amount close or equal to fair value in order to meet a plan's liquidity requirements or to respond to specific
events such as deterioration in the creditworthiness of any particular issuer or counterparty.
events such as deterioration in the creditworthiness of any particular issuer or counterparty.
Illiquid investments held by the plans are generally long-term investments that complement the long-term nature of pension
Illiquid investments held by the plans are generally long-term investments that complement the long-term nature of pension
obligations and are not used to fund benefit payments when currently due. Plan management monitors liquidity risk on an ongoing
obligations and are not used to fund benefit payments when currently due. Plan management monitors liquidity risk on an ongoing
basis and has procedures in place that are designed to maintain flexibility in addressing plan-specific, broader industry and market
basis and has procedures in place that are designed to maintain flexibility in addressing plan-specific, broader industry and market
liquidity events.
liquidity events.
The pension plans may invest in financial instruments denominated in foreign currencies and may be exposed to risks that the
The pension plans may invest in financial instruments denominated in foreign currencies and may be exposed to risks that the
foreign currency exchange rates might change in a manner that has an adverse effect on the value of the foreign currency denominated
foreign currency exchange rates might change in a manner that has an adverse effect on the value of the foreign currency denominated
assets or liabilities. Forward currency contracts may be used to manage and mitigate foreign currency risk.
assets or liabilities. Forward currency contracts may be used to manage and mitigate foreign currency risk.
The pension plans may invest in debt securities for which any change in the relevant interest rates for particular securities might
The pension plans may invest in debt securities for which any change in the relevant interest rates for particular securities might
result in an investment manager being unable to secure similar returns upon the maturity or the sale of securities. In addition
result in an investment manager being unable to secure similar returns upon the maturity or the sale of securities. In addition
changes to prevailing interest rates or changes in expectations of future interest rates might result in an increase or decrease in the
changes to prevailing interest rates or changes in expectations of future interest rates might result in an increase or decrease in the
fair value of the securities held. Interest rate swaps and other financial derivative instruments may be used to manage interest rate
fair value of the securities held. Interest rate swaps and other fmancial derivative instruments may be used to manage interest rate
risk.
risk.
Benefit Payments Benefits for most U.S. pension plans and certain non-U.S. pension plans are paid out of plan assets rather than
Benefit Payments Benefits for most U.S. pension plans and certain non-U.S. pension plans are paid out of plan assets rather than
our Cash and cash equivalents. The following table summarizes net benefit payments expected to be paid in the future, which
our Cash and cash equivalents. The following table summarizes net benefit payments expected to be paid in the future, which
include assumptions related to estimated future employee service:
include assumptions related to estimated future employee service:
Pension Benefits
Pension Benefits
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,942
2020 $ 4,942
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,755
2021 $ 4,755
4,631
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2022 $ 4,631
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,515
2023 $ 4,515
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
4,407
2024 $ 4,407
2025 - 2029 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
20,257
2025 - 2029 $ 20,257
U.S. Plans
U.S. Plans
Non-U.S. Plans
Non-U.S. Plans
$
1,529
$ 1,529
$
1,201
$ 1,201
$
1,164
$ 1,164
$
1,130
$ 1,130
$
1,104
$ 1,104
$
5,166
$ 5,166
Global OPEB
Global OPEB
Plans
Plans
$
372
$ 372
$
369
$ 369
365
$
5 365
$
360
5 360
$
357
5 357
1,755
$
5 1,755
Note 16. Commitments and Contingencies
Note 16. Commitments and Contingencies
Litigation-Related Liability and Tax Administrative Matters In the normal course of our business, we are named from time
Litigation-Related Liability and Tax Administrative Matters In the normal course of our business, we are named from time
to time as a defendant in various legal actions, including arbitrations, class actions and other litigation. We identify below the
to time as a defendant in various legal actions, including arbitrations, class actions and other litigation. We identify below the
material individual proceedings and investigations where we believe a material loss is reasonably possible or probable. We accruerr
material individual proceedings and investigations where we believe a material loss is reasonably possible or probable. We accrue
for matters when we believe that losses are probable and can be reasonably estimated. At December 31, 2019 and 2018, we had
for matters when we believe that losses are probable and can be reasonably estimated. At December 31, 2019 and 2018, we had
accruals of $1.3 billion in Accrued liabilities and Other liabilities. In many matters, it is inherently difficult to determine whether
accruals of $1.3 billion in Accrued liabilities and Other liabilities. In many matters, it is inherently difficult to determine whether
loss is probable or reasonably possible or to estimate the size or range of the possible loss. Accordingly adverse outcomes from
loss is probable or reasonably possible or to estimate the size or range of the possible loss. Accordingly adverse outcomes from
such proceedings could exceed the amounts accrued by an amount that could be material to our results of operations or cash flows
such proceedings could exceed the amounts accrued by an amount that could be material to our results of operations or cash flows
in any particular reporting period.
in any particular reporting period.
Proceedings Related to Ignition Switch Recall and Other Recalls In 2014 we announced various recalls relating to safety and
Proceedings Related to Ignition Switch Recall and Other Recalls In 2014 we announced various recalls relating to safety and
other matters. Those recalls included recalls to repair ignition switches that could under certain circumstances unintentionally
other matters. Those recalls included recalls to repair ignition switches that could under certain circumstances unintentionally
77
77
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
move from the “run” position to the “accessory” or “off” position with a corresponding loss of power, which could in turn prevent
move from the "run" position to the "accessory" or "off" position with a corresponding loss of power, which could in turn prevent
airbags from deploying in the event of a crash.
airbags from deploying in the event of a crash.
Appellate Litigation Regarding Successor Liability Ignition Switch Claims In 2016, the U.S. Court of Appeals for the Second
Appellate Litigation Regarding Successor Liability Ignition Switch Claims In 2016, the U.S. Court of Appeals for the Second
Circuit held that the 2009 order of the Bankruptcy Court approving the sale of substantially all of the assets of MLC to GM free
Circuit held that the 2009 order of the Bankruptcy Court approving the sale of substantially all of the assets of MLC to GM free
and clear of, among other things, claims asserting successor liability for obligations owed by MLC could not be enforced to bar
and clear of, among other things, claims asserting successor liability for obligations owed by MLC could not be enforced to bar
claims against GM asserted by either plaintiffs who purchased used vehicles after the sale or against purchasers who asserted
claims against GM asserted by either plaintiffs who purchased used vehicles after the sale or against purchasers who asserted
claims relating to the ignition switch defect, including pre-sale personal injury claims and economic-loss claims.
claims relating to the ignition switch defect, including pre-sale personal injury claims and economic-loss claims.
Economic-Loss Claims We are aware of over 100 putative class actions pending against GM in U.S. and Canadian courts alleging
Economic-Loss Claims We are aware of over 100 putative class actions pending against GM in U.S. and Canadian courts alleging
that consumers who purchased or leased vehicles manufactured by GM or MLC, formerly known as General Motors Corporation,
that consumers who purchased or leased vehicles manufactured by GM or MLC, formerly known as General Motors Corporation,
had been economically harmed by one or more of the 2014 recalls and/or the underlying vehicle conditions associated with those
had been economically harmed by one or more of the 2014 recalls and/or the underlying vehicle conditions associated with those
recalls (economic-loss cases). In general, these economic-loss cases seek recovery for purported compensatory damages, such as
recalls (economic-loss cases). In general, these economic-loss cases seek recovery for purported compensatory damages, such as
alleged benefit-of-the-bargain damages or damages related to alleged diminution in value of the vehicles, as well as punitive
alleged benefit-of-the-bargain damages or damages related to alleged diminution in value of the vehicles, as well as punitive
damages, injunctive relief and other relief.
damages, injunctive relief and other relief.
Many of the pending U.S. economic-loss claims have been transferred to, and consolidated in, a single federal court, the U.S.
Many of the pending U.S. economic-loss claims have been transferred to, and consolidated in, a single federal court, the U.S.
District Court for the Southern District of New York (Southern District). These plaintiffs have asserted economic-loss claims under
District Court for the Southern District of New York (Southern District). These plaintiffs have asserted economic-loss claims under
federal and state laws, including claims relating to recalled vehicles manufactured by GM and claims asserting successor liability
federal and state laws, including claims relating to recalled vehicles manufactured by GM and claims asserting successor liability
relating to certain recalled vehicles manufactured by MLC.
relating to certain recalled vehicles manufactured by MLC.
u
In August 2017, the Southern District granted our motion to dismiss the successor liability claims of plaintiffs in seven of the
In August 2017, the Southern District granted our motion to dismiss the successor liability claims of plaintiffs in seven of the
sixteen states at issue on the motion and called for additional briefing to decide whether plaintiffs' claims can proceed in the other
sixteen states at issue on the motion and called for additional briefing to decide whether plaintiffs' claims can proceed in the other
nine states. In December 2017, the Southern District granted GM's motion and dismissed the plaintiffs' successor liability claims
nine states. In December 2017, the Southern District granted GM's motion and dismissed the plaintiffs' successor liability claims
in an additional state, but found that there are genuine issues of material fact that prevent summary judgment for GM in eight other
in an additional state, but found that there are genuine issues of material fact that prevent summary judgment for GM in eight other
states. In January 2018, GM moved for reconsideration of certain portions of the Southern District's December 2017 summary
states. In January 2018, GM moved for reconsideration of certain portions of the Southern District's December 2017 summary
judgment ruling. That motion was granted in April 2018, dismissing plaintiffs' successor liability claims in any state where New
judgment ruling. That motion was granted in April 2018, dismissing plaintiffs' successor liability claims in any state where New
York law applies.
York law applies.
In September 2018, the Southern District granted our motion to dismiss claims for lost personal time (in 41 out of 47 jurisdictions)
In September 2018, the Southern District granted our motion to dismiss claims for lost personal time (in 41 out of 47 jurisdictions)
and certain unjust enrichment claims, but denied our motion to dismiss plaintiffs' economic loss claims in 27 jurisdictions under
and certain unjust enrichment claims, but denied our motion to dismiss plaintiffs' economic loss claims in 27 jurisdictions under
the "manifest defect" rule. Significant summary judgment, class certification, and expert evidentiary motions remain at issue.
the "manifest defect" rule. Significant summary judgment, class certification, and expert evidentiary motions remain at issue.
In August 2019, the Southern District granted our motion for summary judgment on plaintiffs’ economic loss “benefit of the
In August 2019, the Southern District granted our motion for summary judgment on plaintiffs' economic loss "benefit of the
bargain” damage claims (the August 2019 Opinion). The Southern District held that plaintiffs’ conjoint analysis-based damages
bargain" damage claims (the August 2019 Opinion). The Southern District held that plaintiffs' conjoint analysis-based damages
model failed to establish that plaintiffs suffered difference-in-value damages and without such evidence, plaintiffs’ difference-in-
model failed to establish that plaintiffs suffered difference-in-value damages and without such evidence, plaintiffs' difference-in-
value damage claims fail under the laws of all three bellwether states: California, Missouri and Texas. Later in August 2019, the
value damage claims fail under the laws of all three bellwether states: California, Missouri and Texas. Later in August 2019, the
bellwether plaintiffs filed a motion requesting that the Southern District reconsider its summary judgment decision or allow an
bellwether plaintiffs filed a motion requesting that the Southern District reconsider its summary judgment decision or allow an
interlocutory appeal if reconsideration is denied. In December 2019, the Southern District denied plaintiffs' motion for
interlocutory appeal if reconsideration is denied. In December 2019, the Southern District denied plaintiffs' motion for
reconsideration of the August 2019 Opinion, but granted the plaintiffs' motion for certification of an interlocutory appeal. Plaintiffs
reconsideration of the August 2019 Opinion, but granted the plaintiffs' motion for certification of an interlocutory appeal. Plaintiffs
filed their petition requesting interlocutory review with the Second Circuit Court of Appeals, and GM filed its opposition in January
filed their petition requesting interlocutory review with the Second Circuit Court ofAppeals, and GM filed its opposition in January
2020.
2020.
t
In September 2019, GM filed an updated motion for summary judgment on plaintiffs’ remaining economic loss claims that were
In September 2019, GM filed an updated motion for summary judgment on plaintiffs' remaining economic loss claims that were
not addressed in the Southern District’s August 2019 Opinion and renewed its evidentiary motion seeking to strike the opinions
not addressed in the Southern District's August 2019 Opinion and renewed its evidentiary motion seeking to strike the opinions
of plaintiff’s expert on plaintiffs’ alleged “lost time” damages associated with having the recall repairs performed.
of plaintiff's expert on plaintiffs' alleged "lost time" damages associated with having the recall repairs performed.
Personal Injury Claims We also are aware of several hundred actions pending in various courts in the U.S. and Canada alleging
Personal Injury Claims We also are aware of several hundred actions pending in various courts in the U.S. and Canada alleging
injury or death as a result of defects that may be the subject of the 2014 recalls (personal injury cases). In general, these cases seek
injury or death as a result of defects that may be the subject of the 2014 recalls (personal injury cases). In general, these cases seek
recovery for purported compensatory damages, punitive damages and/or other relief. Since 2016, several bellwether trials of
recovery for purported compensatory damages, punitive damages and/or other relief. Since 2016, several bellwether trials of
personal injury cases have taken place in the Southern District and in a Texas state court, which is administering a Texas state
personal injury cases have taken place in the Southern District and in a Texas state court, which is administering a Texas state
multi-district litigation. None of these trials resulted in a finding of liability against GM.
multi-district litigation. None of these trials resulted in a fmding of liability against GM.
Contingently Issuable Shares Under the Amended and Restated Master Sale and Purchase Agreement between GM and MLC,
Contingently Issuable Shares Under the Amended and Restated Master Sale and Purchase Agreement between GM and MLC,
78
78
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GM may be obligated to issue Adjustment Shares of our common stock if allowed general unsecured claims against the GUC
GM may be obligated to issue Adjustment Shares of our common stock if allowed general unsecured claims against the GUC
Trust, as estimated by the Bankruptcy Court, exceed $35.0 billion. The maximum number of Adjustment Shares issuable is 30
Trust, as estimated by the Bankruptcy Court, exceed $35.0 billion. The maximum number of Adjustment Shares issuable is 30
million shares (subject to adjustment to take into account stock dividends, stock splits and other transactions), which amounts to
million shares (subject to adjustment to take into account stock dividends, stock splits and other transactions), which amounts to
approximately $1.0 billion based on the GM share price as of January 24, 2020. The GUC Trust stated in public filings that allowed
approximately $1.0 billion based on the GM share price as of January 24,2020. The GUC Trust stated in public filings that allowed
general unsecured claims were approximately $32.1 billion as of September 30, 2019.
general unsecured claims were approximately $32.1 billion as of September 30, 2019.
In February 2019, the GUC Trust and certain personal injury and economic-loss plaintiffs filed a motion with the Bankruptcy
In February 2019, the GUC Trust and certain personal injury and economic-loss plaintiffs filed a motion with the Bankruptcy
Court requesting approval of a settlement to obtain the maximum number of Adjustment Shares. In September 2019, the GUC
Court requesting approval of a settlement to obtain the maximum number of Adjustment Shares. In September 2019, the GUC
Trust advised the Bankruptcy Court that it was formally terminating the February 2019 proposed class settlement with plaintiffs
Trust advised the Bankruptcy Court that it was formally terminating the February 2019 proposed class settlement with plaintiffs
because it was no longer viable given the August 2019 Opinion and further briefing was moot.
because it was no longer viable given the August 2019 Opinion and further briefing was moot.
Government Matters In connection with the 2014 recalls, we have from time to time received subpoenas and other requests for
Government Matters In connection with the 2014 recalls, we have from time to time received subpoenas and other requests for
information related to investigations by agencies or other representatives of U.S. federal, state and the Canadian governments.
information related to investigations by agencies or other representatives of U.S. federal, state and the Canadian governments.
GM is cooperating with all reasonable pending requests for information. Any existing governmental matters or investigations could
GM is cooperating with all reasonable pending requests for information. Any existing governmental matters or investigations could
in the future result in the imposition of damages, fines, civil consent orders, civil and criminal penalties or other remedies.
in the future result in the imposition of damages, fmes, civil consent orders, civil and criminal penalties or other remedies.
The total amount accrued for the 2014 recalls at December 31, 2019, reflects amounts for a combination of settled but unpaid
The total amount accrued for the 2014 recalls at December 31, 2019, reflects amounts for a combination of settled but unpaid
matters, and for the remaining unsettled investigations, claims and/or lawsuits relating to the ignition switch recalls and other
matters, and for the remaining unsettled investigations, claims and/or lawsuits relating to the ignition switch recalls and other
related recalls to the extent that such matters are probable and can be reasonably estimated. The amounts accrued for those unsettled
related recalls to the extent that such matters are probable and can be reasonably estimated. The amounts accrued for those unsettled
investigations, claims, and/or lawsuits represent a combination of our best single point estimates where determinable and, where
investigations, claims, and/or lawsuits represent a combination of our best single point estimates where determinable and, where
no such single point estimate is determinable, our estimate of the low end of the range of probable loss with regard to such matters,
no such single point estimate is determinable, our estimate of the low end of the range of probable loss with regard to such matters,
if that is determinable. We will continue to consider resolution of pending matters involving ignition switch recalls and other recalls
if that is determinable. We will continue to consider resolution of pending matters involving ignition switch recalls and other recalls
where it makes sense to do so.
where it makes sense to do so.
r
GM Korea Wage Litigation GM Korea is party to litigation with current and former hourly employees in the appellate court
GM Korea Wage Litigation GM Korea is party to litigation with current and former hourly employees in the appellate court
and Incheon District Court in Incheon, Korea. The group actions, which in the aggregate involve more than 10,000 employees,
and Incheon District Court in Incheon, Korea. The group actions, which in the aggregate involve more than 10,000 employees,
allege that GM Korea failed to include bonuses and certain allowances in its calculation of Ordinary Wages due under Korean
allege that GM Korea failed to include bonuses and certain allowances in its calculation of Ordinary Wages due under Korean
regulations. In 2012 the Seoul High Court (an intermediate-level appellate court) affirmed a decision in one of these group actions
regulations. In 2012 the Seoul High Court (an intermediate-level appellate court) affirmed a decision in one of these group actions
involving five GM Korea employees which was contrary to GM Korea's position. GM Korea appealed to the Supreme Court of
involving five GM Korea employees which was contrary to GM Korea's position. GM Korea appealed to the Supreme Court of
the Republic of Korea (Korean Supreme Court). In 2014 the Korean Supreme Court largely agreed with GM's legal arguments
the Republic of Korea (Korean Supreme Court). In 2014 the Korean Supreme Court largely agreed with GM's legal arguments
and remanded the case to the Seoul High Court for consideration consistent with earlier Korean Supreme Court precedent holding
and remanded the case to the Seoul High Court for consideration consistent with earlier Korean Supreme Court precedent holding
that while fixed bonuses should be included in the calculation of Ordinary Wages, claims for retroactive application of this rule
that while fixed bonuses should be included in the calculation of Ordinary Wages, claims for retroactive application of this rule
would be barred under certain circumstances. In 2015, on reconsideration, the Seoul High Court held in GM Korea's favor, after
would be barred under certain circumstances. In 2015, on reconsideration, the Seoul High Court held in GM Korea's favor, after
which the plaintiffs appealed to the Korean Supreme Court. The Korean Supreme Court has not yet rendered a decision. We estimate
which the plaintiffs appealed to the Korean Supreme Court. The Korean Supreme Court has not yet rendered a decision. We estimate
our reasonably possible loss in excess of amounts accrued to be approximately $600 million at December 31, 2019. Both the scope
our reasonably possible loss in excess of amounts accrued to be approximately $600 million at December 31, 2019. Both the scope
of claims asserted and GM Korea's assessment of any or all of the individual claim elements may change if new information
of claims asserted and GM Korea's assessment of any or all of the individual claim elements may change if new information
becomes available or the legal or regulatory frameworks change.
becomes available or the legal or regulatory frameworks change.
GM Korea is also party to litigation with current and former salaried employees over allegations relating to Ordinary Wages
GM Korea is also party to litigation with current and former salaried employees over allegations relating to Ordinary Wages
regulation and whether to include fixed bonuses in the calculation of Ordinary Wages. In 2017, the Seoul High Court held that
regulation and whether to include fixed bonuses in the calculation of Ordinary Wages. In 2017, the Seoul High Court held that
certain workers are not barred from filing retroactive wage claims. GM Korea appealed this ruling to the Korean Supreme Court.
certain workers are not barred from filing retroactive wage claims. GM Korea appealed this ruling to the Korean Supreme Court.
The Korean Supreme Court has not yet rendered a decision. We estimate our reasonably possible loss in excess of amounts accrued
The Korean Supreme Court has not yet rendered a decision. We estimate our reasonably possible loss in excess of amounts accrued
to be approximately $170 million at December 31, 2019. Both the scope of claims asserted and GM Korea's assessment of any or
to be approximately $170 million at December 31, 2019. Both the scope of claims asserted and GM Korea's assessment of any or
all of the individual claim elements may change if new information becomes available or the legal or regulatory frameworks
all of the individual claim elements may change if new information becomes available or the legal or regulatory frameworks
change.
change.
GM Korea is also party to litigation with current and former subcontract workers over allegations that they are entitled to the
GM Korea is also party to litigation with current and former subcontract workers over allegations that they are entitled to the
same wages and benefits provided to full-time employees, and to be hired as full-time employees. In May 2018, the Korean labor
same wages and benefits provided to full-time employees, and to be hired as full-time employees. In May 2018, the Korean labor
authorities issued an adverse administrative order finding that GM Korea must hire certain current subcontract workers as full-
authorities issued an adverse administrative order finding that GM Korea must hire certain current subcontract workers as full-
time employees. GM Korea appealed that order. At December 31, 2019, our accrual covering certain asserted claims and claims
time employees. GM Korea appealed that order. At December 31, 2019, our accrual covering certain asserted claims and claims
that we believe are probable of assertion and for which liability is probable was approximately $180 million. We estimate the
that we believe are probable of assertion and for which liability is probable was approximately $180 million. We estimate the
reasonably possible loss in excess of amounts accrued for other current subcontract workers who may assert similar claims to be
reasonably possible loss in excess of amounts accrued for other current subcontract workers who may assert similar claims to be
approximately $110 million at December 31, 2019. We are currently unable to estimate any possible loss or range of loss that mayaa
approximately $110 million at December 31, 2019. We are currently unable to estimate any possible loss or range of loss that may
result from additional claims that may be asserted by former subcontract workers.
result from additional claims that may be asserted by former subcontract workers.
79
79
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GM Brazil Indirect Tax Claim During the year ended December 31, 2019, the Superior Judicial Court of Brazil rendered
GM Brazil Indirect Tax Claim During the year ended December 31, 2019, the Superior Judicial Court of Brazil rendered
favorable decisions on three cases brought by GM Brazil, each challenging whether a certain state value-added tax should be
favorable decisions on three cases brought by GM Brazil, each challenging whether a certain state value-added tax should be
included in the calculation of federal gross receipts taxes. The decisions will allow the Company the right to recover, through offset
included in the calculation of federal gross receipts taxes. The decisions will allow the Company the right to recover, through offset
of federal tax liabilities, amounts collected by the government from August 2001 to February 2017. As a result of the favorable
of federal tax liabilities, amounts collected by the government from August 2001 to February 2017. As a result of the favorable
decisions, we recorded pre-tax recoveries of $1.4 billion in Automotive and other cost of sales in the year ended December 31,
decisions, we recorded pre-tax recoveries of $1.4 billion in Automotive and other cost of sales in the year ended December 31,
2019. Timing on realization of these recoveries is dependent upon the timing of administrative approvals and generation of federal
2019. Timing on realization of these recoveries is dependent upon the timing of administrative approvals and generation of federal
tax liabilities eligible for offset. The Brazilian IRS has filed a Motion of Clarification on this matter with the Brazilian Supreme
tax liabilities eligible for offset. The Brazilian IRS has filed a Motion of Clarification on this matter with the Brazilian Supreme
Court, which could be decided as early as April 2020. In addition, we expect third parties to make claims on some or all of the
Court, which could be decided as early as April 2020. In addition, we expect third parties to make claims on some or all of the
pre-tax recoveries, which GM intends to defend against.
pre-tax recoveries, which GM intends to defend against.
h
uu
Other Litigation-Related Liability and Tax Administrative Matters Various other legal actions, including class actions,
Other Litigation-Related Liability and Tax Administrative Matters Various other legal actions, including class actions,
governmental investigations, claims and proceedings are pending against us or our related companies or joint ventures, including
governmental investigations, claims and proceedings are pending against us or our related companies or joint ventures, including
matters arising out of alleged product defects; employment-related matters; product and workplace safety, vehicle emissions and
matters arising out of alleged product defects; employment-related matters; product and workplace safety, vehicle emissions and
fuel economy regulations; product warranties; financial services; dealer, supplier and other contractual relationships; government
fuel economy regulations; product warranties; financial services; dealer, supplier and other contractual relationships; government
regulations relating to competition issues; tax-related matters not subject to the provision of Accounting Standards Codification
regulations relating to competition issues; tax-related matters not subject to the provision of Accounting Standards Codification
740, Income Taxes (indirect tax-related matters); product design, manufacture and performance; consumer protection laws; and
740, Income Taxes (indirect tax-related matters); product design, manufacture and performance; consumer protection laws; and
environmental protection laws, including laws regulating air emissions, water discharges, waste management and environmental
environmental protection laws, including laws regulating air emissions, water discharges, waste management and environmental
remediation from stationary sources.
remediation from stationary sources.
There are several putative class actions pending against GM in federal courts in the U.S., in the Provincial Courts in Canada
There are several putative class actions pending against GM in federal courts in the U.S., in the Provincial Courts in Canada
and in Israel alleging that various vehicles sold including model year 2011-2016 Duramax Diesel Chevrolet Silverado and GMC
and in Israel alleging that various vehicles sold including model year 2011-2016 Duramax Diesel Chevrolet Silverado and GMC
Sierra vehicles, violate federal, state and foreign emission standards. GM has also faced a series of additional lawsuits based
Sierra vehicles, violate federal, state and foreign emission standards. GM has also faced a series of additional lawsuits based
primarily on allegations in the Duramax suit, including putative shareholder class actions claiming violations of federal securities
primarily on allegations in the Duramax suit, including putative shareholder class actions claiming violations of federal securities
law and a shareholder demand lawsuit. The securities lawsuits have been voluntarily dismissed by the plaintiffs in those actions.
law and a shareholder demand lawsuit. The securities lawsuits have been voluntarily dismissed by the plaintiffs in those actions.
We are unable to estimate any reasonably possible loss or range of loss that may result from these actions.
We are unable to estimate any reasonably possible loss or range of loss that may result from these actions.
We believe that appropriate accruals have been established for losses that are probable and can be reasonably estimated. It is
We believe that appropriate accruals have been established for losses that are probable and can be reasonably estimated. It is
possible that the resolution of one or more of these matters could exceed the amounts accrued in an amount that could be material
possible that the resolution of one or more of these matters could exceed the amounts accrued in an amount that could be material
to our results of operations. We also from time to time receive subpoenas and other inquiries or requests for information from
to our results of operations. We also from time to time receive subpoenas and other inquiries or requests for information from
agencies or other representatives of U.S. federal, state and foreign governments on a variety of issues.
agencies or other representatives of U.S. federal, state and foreign governments on a variety of issues.
Indirect tax-related matters are being litigated globally pertaining to value added taxes, customs, duties, sales, property taxes
Indirect tax-related matters are being litigated globally pertaining to value added taxes, customs, duties, sales, property taxes
and other non-income tax related tax exposures. The various non-U.S. labor-related matters include claims from current and former
and other non-income tax related tax exposures. The various non-U.S. labor-related matters include claims from current and former
employees related to alleged unpaid wage, benefit, severance and other compensation matters. Certain administrative proceedings
employees related to alleged unpaid wage, benefit, severance and other compensation matters. Certain administrative proceedings
are indirect tax-related and may require that we deposit funds in escrow or provide an alternative form of security. Some of the
are indirect tax-related and may require that we deposit funds in escrow or provide an alternative form of security. Some of the
matters may involve compensatory, punitive or other treble damage claims, environmental remediation programs or sanctions that,
matters may involve compensatory, punitive or other treble damage claims, environmental remediation programs or sanctions that,
if granted, could require us to pay damages or make other expenditures in amounts that could not be reasonably estimated at
if granted, could require us to pay damages or make other expenditures in amounts that could not be reasonably estimated at
December 31, 2019. We believe that appropriate accruals have been established for losses that are probable and can be reasonably
December 31, 2019. We believe that appropriate accruals have been established for losses that are probable and can be reasonably
estimated. For indirect tax-related matters we estimate our reasonably possible loss in excess of amounts accrued to be up to
estimated. For indirect tax-related matters we estimate our reasonably possible loss in excess of amounts accrued to be up to
approximately $800 million at December 31, 2019.
approximately $800 million at December 31, 2019.
Takata Matters In May 2016, NHTSA issued an amended consent order requiring Takata to file DIRs for previously unrecalled
Takata Matters In May 2016, NHTSA issued an amended consent order requiring Takata to file DIRs for previously unrecalled
front airbag inflators that contain phased-stabilized ammonium nitrate-based propellant without a moisture absorbing desiccant
front airbag inflators that contain phased-stabilized ammonium nitrate-based propellant without a moisture absorbing desiccant
on a multi-year, risk-based schedule through 2019 impacting tens of millions of vehicles produced by numerous automotive
on a multi-year, risk-based schedule through 2019 impacting tens of millions of vehicles produced by numerous automotive
manufacturers. NHTSA concluded that the likely root cause of the rupturing of the airbag inflators is a function of time, temperature
manufacturers. NHTSA concluded that the likely root cause of the rupturing of the airbag inflators is a function of time, temperature
cycling and environmental moisture.
cycling and environmental moisture.
Although we do not believe there is a safety defect at this time in any unrecalled GM vehicles within scope of the Takata DIRs,
Although we do not believe there is a safety defect at this time in any unrecalled GM vehicles within scope of the Takata DIRs,
in cooperation with NHTSA we have filed Preliminary DIRs covering certain of our GMT900 vehicles, which are full-size pickup
in cooperation with NHTSA we have filed Preliminary DIRs covering certain of our GMT900 vehicles, which are full-size pickup
trucks and SUVs. We have also filed petitions for inconsequentiality with respect to the vehicles subject to those Preliminary DIRs.
trucks and SUVs. We have also filed petitions for inconsequentiality with respect to the vehicles subject to those Preliminary DIRs.
NHTSA has consolidated our petitions and will rule on them at the same time.
NHTSA has consolidated our petitions and will rule on them at the same time.
While these petitions have been pending, we have provided NHTSA with the results of our long-term studies and the studies
While these petitions have been pending, we have provided NHTSA with the results of our long-term studies and the studies
performed by third-party experts, all of which form the basis for our determination that the inflators in these vehicles do not present
performed by third-party experts, all of which form the basis for our determination that the inflators in these vehicles do not present
an unreasonable risk to safety and that no repair should ultimately be required.
an unreasonable risk to safety and that no repair should ultimately be required.
t
80
80
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We believe these vehicles are currently performing as designed and our inflator aging studies and field data support the belief
We believe these vehicles are currently performing as designed and our inflator aging studies and field data support the belief
that the vehicles' unique design and integration mitigates against inflator propellant degradation and rupture risk. For example,
that the vehicles' unique design and integration mitigates against inflator propellant degradation and rupture risk. For example,
the airbag inflators used in the vehicles are a variant engineered specifically for our vehicles, and include features such as greater
the airbag inflators used in the vehicles are a variant engineered specifically for our vehicles, and include features such as greater
venting, unique propellant wafer configurations, and machined steel end caps. The inflators are packaged in the instrument panel
venting, unique propellant wafer configurations, and machined steel end caps. The inflators are packaged in the instrument panel
in such a way as to minimize exposure to moisture from the climate control system. Also, these vehicles have features that minimize
in such a way as to minimize exposure to moisture from the climate control system. Also, these vehicles have features that minimize
the maximum temperature to which the inflator will be exposed, such as larger interior volumes and standard solar absorbing
the maximum temperature to which the inflator will be exposed, such as larger interior volumes and standard solar absorbing
windshields and side glass.
windshields and side glass.
Accordingly, no warranty provision has been made for any repair associated with our vehicles subject to the Preliminary DIRs
Accordingly, no warranty provision has been made for any repair associated with our vehicles subject to the Preliminary DIRs
and amended consent order. However, in the event we are ultimately obligated to repair the vehicles subject to current or future
and amended consent order. However, in the event we are ultimately obligated to repair the vehicles subject to current or future
Takata DIRs under the amended consent order in the U.S., we estimate a reasonably possible impact to GM of approximately $1.2
Takata DIRs under the amended consent order in the U.S., we estimate a reasonably possible impact to GM of approximately $1.2
billion.
billion.
GM has recalled certain vehicles sold outside of the U.S. to replace Takata inflators in those vehicles. There are significant
GM has recalled certain vehicles sold outside of the U.S. to replace Takata inflators in those vehicles. There are significant
differences in vehicle and inflator design between the relevant vehicles sold internationally and those sold in the U.S. We continue
differences in vehicle and inflator design between the relevant vehicles sold internationally and those sold in the U.S. We continue
to gather and analyze evidence about these inflators and to share our findings with regulators. Additional recalls, if any, could be
to gather and analyze evidence about these inflators and to share our findings with regulators. Additional recalls, if any, could be
material to our results of operations and cash flows. We continue to monitor the international situation.
material to our results of operations and cash flows. We continue to monitor the international situation.
There are several putative class actions that have been filed against GM in federal courts in the U.S., in the Provincial Courts
There are several putative class actions that have been filed against GM in federal courts in the U.S., in the Provincial Courts
in Canada, Mexico and Israel arising out of allegations that airbag inflators manufactured by Takata are defective. At this early
in Canada, Mexico and Israel arising out of allegations that airbag inflators manufactured by Takata are defective. At this early
stage of these proceedings, we are unable to provide an evaluation of the likelihood that a loss will be incurred or an estimate of
stage of these proceedings, we are unable to provide an evaluation of the likelihood that a loss will be incurred or an estimate of
the amounts or range of possible loss.
the amounts or range of possible loss.
Product Liability We recorded liabilities of $544 million and $531 million in Accrued liabilities and Other liabilities at
Product Liability We recorded liabilities of $544 million and $531 million in Accrued liabilities and Other liabilities at
December 31, 2019 and 2018, for the expected cost of all known product liability claims, plus an estimate of the expected cost for
December 31, 2019 and 2018, for the expected cost of all known product liability claims, plus an estimate of the expected cost for
product liability claims that have already been incurred and are expected to be filed in the future for which we are self-insured. It
product liability claims that have already been incurred and are expected to be filed in the future for which we are self-insured. It
is reasonably possible that our accruals for product liability claims may increase in future periods in material amounts, although
is reasonably possible that our accruals for product liability claims may increase in future periods in material amounts, although
we cannot estimate a reasonable range of incremental loss based on currently available information. Other than claims relating to
we cannot estimate a reasonable range of incremental loss based on currently available information. Other than claims relating to
the ignition switch recalls discussed above, we believe that any judgment against us involving our and General Motors Corporation
the ignition switch recalls discussed above, we believe that any judgment against us involving our and General Motors Corporation
products for actual damages will be adequately covered by our recorded accruals and, where applicable, excess liability insurance
products for actual damages will be adequately covered by our recorded accruals and, where applicable, excess liability insurance
coverage.
coverage.
Guarantees We enter into indemnification agreements for liability claims involving products manufactured primarily by certain
Guarantees We enter into indemnification agreements for liability claims involving products manufactured primarily by certain
joint ventures. These guarantees terminate in years ranging from 2020 to 2024 or upon the occurrence of specific events or are
joint ventures. These guarantees terminate in years ranging from 2020 to 2024 or upon the occurrence of specific events or are
ongoing. We believe that the related potential costs incurred are adequately covered by our recorded accruals, which are insignificant.
ongoing. We believe that the related potential costs incurred are adequately covered by our recorded accruals, which are insignificant.
The maximum future undiscounted payments mainly based on vehicles sold to date were $2.6 billion and $2.4 billion for these
The maximum future undiscounted payments mainly based on vehicles sold to date were $2.6 billion and $2.4 billion for these
guarantees at December 31, 2019 and 2018, the majority of which relates to the indemnification agreements.
guarantees at December 31, 2019 and 2018, the majority of which relates to the indemnification agreements.
We provide payment guarantees on commercial loans outstanding with third parties such as dealers. In some instances certain
We provide payment guarantees on commercial loans outstanding with third parties such as dealers. In some instances certain
assets of the party or our payables to the party whose debt or performance we have guaranteed may offset, to some degree, the
assets of the party or our payables to the party whose debt or performance we have guaranteed may offset, to some degree, the
amount of any potential future payments. We are also exposed to residual value guarantees associated with certain sales to rental
amount of any potential future payments. We are also exposed to residual value guarantees associated with certain sales to rental
car companies.
car companies.
We periodically enter into agreements that incorporate indemnification provisions in the normal course of business. It is not
We periodically enter into agreements that incorporate indemnification provisions in the normal course of business. It is not
possible to estimate our maximum exposure under these indemnifications or guarantees due to the conditional nature of these
possible to estimate our maximum exposure under these indemnifications or guarantees due to the conditional nature of these
obligations. Insignificant amounts have been recorded for such obligations as the majority of them are not probable or estimable
obligations. Insignificant amounts have been recorded for such obligations as the majority of them are not probable or estimable
at this time and the fair value of the guarantees at issuance was insignificant. Refer to Note 22 for additional information on our
at this time and the fair value of the guarantees at issuance was insignificant. Refer to Note 22 for additional information on our
indemnification obligations to PSA Group under the Master Agreement (the Agreement).
indemnification obligations to PSA Group under the Master Agreement (the Agreement).
n
Credit Cards Credit card programs offer rebates that can be applied primarily against the purchase or lease of our vehicles. At
Credit Cards Credit card programs offer rebates that can be applied primarily against the purchase or lease of our vehicles. At
December 31, 2019 and 2018, our redemption liability was insignificant, our deferred revenue was $253 million and $247 million,
December 31, 2019 and 2018, our redemption liability was insignificant, our deferred revenue was $253 million and $247 million,
and qualified cardholders had rebates available, net of deferred program revenue, of $1.4 billion. Our redemption liability and
and qualified cardholders had rebates available, net of deferred program revenue, of $1.4 billion. Our redemption liability and
deferred revenue are recorded in Accrued liabilities and Other liabilities.
deferred revenue are recorded in Accrued liabilities and Other liabilities.
Operating Leases Our portfolio of leases primarily consists of real estate office space, manufacturing and warehousing facilities,
Operating Leases Our portfolio of leases primarily consists of real estate office space, manufacturing and warehousing facilities,
land and equipment. Certain leases contain escalation clauses and renewal or purchase options, and generally our leases have no
land and equipment. Certain leases contain escalation clauses and renewal or purchase options, and generally our leases have no
81
81
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
residual value guarantees or material covenants. We exclude leases with a term of one year or less from our balance sheet, and do
residual value guarantees or material covenants. We exclude leases with a term of one year or less from our balance sheet, and do
not separate non-lease components from our real estate leases.
not separate non-lease components from our real estate leases.
Rent expense under operating leases was $354 million in the year ended December 31, 2019. Prior to adoption of ASU 2016-02,
Rent expense under operating leases was $354 million in the year ended December 31, 2019. Prior to adoption ofASU 2016-02,
rent expense under operating leases was $300 million and $284 million in the years ended December 31, 2018 and 2017. Variable
rent expense under operating leases was $300 million and $284 million in the years ended December 31, 2018 and 2017. Variable
lease costs were insignificant in the year ended December 31, 2019. At December 31, 2019, operating lease right of use assets in
lease costs were insignificant in the year ended December 31, 2019. At December 31, 2019, operating lease right of use assets in
Other assets were $1.1 billion, operating lease liabilities in Accrued liabilities were $239 million and non-current operating lease
Other assets were $1.1 billion, operating lease liabilities in Accrued liabilities were $239 million and non-current operating lease
liabilities in Other liabilities were $1.0 billion. Operating lease right of use assets obtained in exchange for lease obligations were
liabilities in Other liabilities were $1.0 billion. Operating lease right of use assets obtained in exchange for lease obligations were
$497 million in the year ended December 31, 2019. Our undiscounted future lease obligations related to operating leases having
$497 million in the year ended December 31, 2019. Our undiscounted future lease obligations related to operating leases having
initial terms in excess of one year are $269 million, $247 million, $179 million, $167 million, $130 million and $464 million for
initial terms in excess of one year are $269 million, $247 million, $179 million, $167 million, $130 million and $464 million for
the years 2020, 2021, 2022, 2023, 2024 and thereafter, with imputed interest of $207 million as of December 31, 2019. The weighted
the years 2020, 2021, 2022, 2023, 2024 and thereafter, with imputed interest of $207 million as of December 31,2019. The weighted
average discount rate was 4.2% and the weighted-average remaining lease term was 7.2 years at December 31, 2019. Payments
average discount rate was 4.2% and the weighted-average remaining lease term was 7.2 years at December 31, 2019. Payments
for operating leases included in Net cash provided by (used in) operating activities were $337 million in the year ended December
for operating leases included in Net cash provided by (used in) operating activities were $337 million in the year ended December
31, 2019. Lease agreements that have not yet commenced were insignificant at December 31, 2019.
31, 2019. Lease agreements that have not yet commenced were insignificant at December 31, 2019.
ff
Note 17. Income Taxes
Note 17. Income Taxes
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
U.S. income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
U.S. income
Non-U.S. income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-U.S. income
Income before income taxes and equity income . . . . . . . . . . . . . . . . . . . . . . . $
Income before income taxes and equity income
3,826
3,826
2,342
2,342
6,168
6,168
$
4,433
$ 4,433
1,953
1,953
$
6,386
$ 6,386
$
8,399
$ 8,399
1,332
1,332
$
9,731
$ 9,731
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Current income tax expense (benefit)
Current income tax expense (benefit)
U.S. federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
42
U.S. federal $ 42
U.S. state and local . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
102
U.S. state and local 102
Non-U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
758
Non-U.S 758
Total current income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
902
Total current income tax expense 902
Deferred income tax expense (benefit)
Deferred income tax expense (benefit)
(145)
U.S. federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. federal (145)
U.S. state and local . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3
U.S. state and local 3
Non-U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9
Non-U.S 9
(133)
Total deferred income tax expense (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . .
Total deferred income tax expense (benefit) (133)
Total income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
769
Total income tax expense $ 769
$
18
$ (104) $ 18
83
83
552
552
653
653
(104) $
113
113
577
577
586
586
(578)
(578)
250
250
216
216
(112)
(112)
$
474
$ 474
7,831
7,831
(187)
(187)
3,236
3,236
10,880
10,880
$
11,533
$ 11,533
Provisions are made for estimated U.S. and non-U.S. income taxes which may be incurred on the reversal of our basis differences
Provisions are made for estimated U.S. and non-U.S. income taxes which may be incurred on the reversal of our basis differences
in investments in foreign subsidiaries and corporate joint ventures not deemed to be indefinitely reinvested. Taxes have not been
in investments in foreign subsidiaries and corporate joint ventures not deemed to be indefinitely reinvested. Taxes have not been
provided on basis differences in investments primarily as a result of earnings in foreign subsidiaries which are deemed indefinitely
provided on basis differences in investments primarily as a result of earnings in foreign subsidiaries which are deemed indefmitely
reinvested of $3.2 billion and $2.9 billion at December 31, 2019 and 2018. Additional basis differences related to investments in
reinvested of $3.2 billion and $2.9 billion at December 31, 2019 and 2018. Additional basis differences related to investments in
nonconsolidated China JVs exist of $4.1 billion at December 31, 2019 and 2018 as a result of fresh-start reporting. Quantification
nonconsolidated China JVs exist of $4.1 billion at December 31, 2019 and 2018 as a result of fresh-start reporting. Quantification
of the deferred tax liability, if any, associated with indefinitely reinvested basis differences is not practicable.
of the deferred tax liability, if any, associated with indefinitely reinvested basis differences is not practicable.
82
82
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
$
Income tax expense at U.S. federal statutory income tax rate. . . . . . . . . . . . . $
1,341
1,295
$ 1,341
Income tax expense at U.S. federal statutory income tax rate S 1.295
282
117
State and local tax expense (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
282
State and local tax expense (benefit) 117
90
166
Non-U.S. income taxed at other than the U.S. federal statutory tax rate . . . .
90
166
Non-U.S. income taxed at other than the U.S. federal statutory tax rate .
(822)
(197)
U.S. tax impact on Non-U.S. income and activities . . . . . . . . . . . . . . . . . . . .
(822)
U.S. tax impact on Non-U.S. income and activities (197)
(233)
1,695
Change in valuation allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,695
Change in valuation allowances (233)
(134)
(122)
Change in tax laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(134)
Change in tax laws (122)
(695)
(420)
General business credits and manufacturing incentives . . . . . . . . . . . . . . . . .
(695)
General business credits and manufacturing incentives (420)
Capital loss expiration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
107
—
Capital loss expiration 107
(188)
Settlements of prior year tax matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements of prior year tax matters (188)
(59)
Realization of basis differences in affiliates . . . . . . . . . . . . . . . . . . . . . . . . . .
(59)
Realization of basis differences in affiliates
(990)
German statutory approval of net operating losses . . . . . . . . . . . . . . . . . . . . .
(990)
German statutory approval of net operating losses
19
74
Foreign currency remeasurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19
Foreign currency remeasurement 74
(172)
Other adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
89
(172)
Other adjustments 89
$
Total income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
474
769
$ 474
Total income tax expense $ 769
—
—
—
$
3,406
$ 3,406
(76)
(76)
(145)
(145)
(941)
(941)
2,712
2,712
7,194
7,194
(428)
(428)
—
(256)
(256)
—
—
23
23
44
44
$
11,533
$ 11,533
Deferred Income Tax Assets and Liabilities Deferred income tax assets and liabilities at December 31, 2019 and 2018 reflect
Deferred Income Tax Assets and Liabilities Deferred income tax assets and liabilities at December 31, 2019 and 2018 reflect
the effect of temporary differences between amounts of assets, liabilities and equity for financial reporting purposes and the bases
the effect of temporary differences between amounts of assets, liabilities and equity for fmancial reporting purposes and the bases
of such assets, liabilities and equity as measured based on tax laws, as well as tax loss and tax credit carryforwards. The following
of such assets, liabilities and equity as measured based on tax laws, as well as tax loss and tax credit can-yforwards. The following
table summarizes the components of temporary differences and carryforwards that give rise to deferred tax assets and liabilities:
table summarizes the components of temporary differences and carryforwards that give rise to deferred tax assets and liabilities:
December 31, 2019
December 31, 2019
December 31, 2018
December 31, 2018
Deferred tax assets
Deferred tax assets
Postretirement benefits other than pensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,695
Postretirement benefits other than pensions 1.695
Pension and other employee benefit plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,968
Pension and other employee benefit plans 2,968
Warranties, dealer and customer allowances, claims and discounts. . . . . . . . . . . . . . . . . .
6,299
Warranties, dealer and customer allowances, claims and discounts 6,299
U.S. capitalized research expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6,035
U.S. capitalized research expenditures 6,035
U.S. operating loss and tax credit carryforwards(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,686
U.S. operating loss and tax credit carryforwards(a) 8,686
Non-U.S. operating loss and tax credit carryforwards(b). . . . . . . . . . . . . . . . . . . . . . . . . .
6,731
Non-U.S. operating loss and tax credit carryforwards(b) 6,731
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,965
Miscellaneous 1,965
34,379
Total deferred tax assets before valuation allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total deferred tax assets before valuation allowances 34,379
(8,135)
Less: valuation allowances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: valuation allowances (8,135)
Total deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
26,244
Total deferred tax assets 26,244
Deferred tax liabilities
Deferred tax liabilities
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,565
Property, plant and equipment 1,565
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
763
Intangible assets 763
Total deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,328
Total deferred tax liabilities 2,328
Net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
23,916
Net deferred tax assets 23,916
$
$
1,584
1,584
3,020
3,020
6,307
6,307
5,176
5,176
8,591
8,591
6,393
6,393
2,034
2,034
33,105
33,105
(7,976)
(7,976)
25,129
25,129
1,098
1,098
729
729
1,827
1,827
$
23,302
$ 23,302
_________
(a) At December 31, 2019 U.S. operating loss and tax credit carryforwards of $8.7 billion expire by 2039 if not utilized.
(a) At December 31, 2019 U.S. operating loss and tax credit carryforwards of $8.7 billion expire by 2039 if not utilized.
(b) At December 31,2019 Non-U.S. operating loss and tax credit carryforwards of $1.3 billion expire by 2039 if not utilized and the remaining
(b) At December 31, 2019 Non-U.S. operating loss and tax credit carryforwards of $1.3 billion expire by 2039 if not utilized and the remaining
balance of $5.4 billion may be carried forward indefinitely.
balance of $5.4 billion may be carried forward indefinitely.
Valuation Allowances During the years ended December 31, 2019 and 2018, valuation allowances against deferred tax assets of
Valuation Allowances During the years ended December 31, 2019 and 2018, valuation allowances against deferred tax assets of
$8.1 billion and $8.0 billion were comprised of cumulative losses, credits and other timing differences, primarily in Germany,
$8.1 billion and $8.0 billion were comprised of cumulative losses, credits and other timing differences, primarily in Germany,
Spain and South Korea.
Spain and South Korea.
83
83
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We have $3.3 billion of net operating loss carryforwards in Germany that, as a result of reorganizations that took place in 2008
We have $3.3 billion of net operating loss carryforwards in Germany that, as a result of reorganizations that took place in 2008
and 2009 and then existing German Law, were not previously recorded as deferred tax assets. In 2018 a favorable European court
and 2009 and then existing German Law, were not previously recorded as deferred tax assets. In 2018 a favorable European court
decision was statutorily approved in Germany enabling use of those loss carryforwards, and deferred tax assets totaling $1.0 billion
decision was statutorily approved in Germany enabling use of those loss carryforwards, and deferred tax assets totaling $1.0 billion
were established for the loss carryforwards. Offsetting valuation allowances were also established as the deferred tax assets are aa
were established for the loss carryforwards. Offsetting valuation allowances were also established as the deferred tax assets are
not more likely than not to be realized.
not more likely than not to be realized.
Uncertain Tax Positions The following table summarizes activity of the total amounts of unrecognized tax benefits:
Uncertain Tax Positions The following table summarizes activity of the total amounts of unrecognized tax benefits:
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,341
Balance at beginning of period $ 1,341
Additions to current year tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
18
Additions to current year tax positions 18
Additions to prior years' tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13
Additions to prior years' tax positions 13
(501)
Reductions to prior years' tax positions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reductions to prior years' tax positions (501)
(8)
Reductions in tax positions due to lapse of statutory limitations . . . . . . . . . .
(8)
Reductions in tax positions due to lapse of statutory limitations
(93)
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements (93)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
Other 5
Balance at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
775
Balance at end of period $ 775
$
1,557
$ 1,557
292
292
264
264
(244)
(244)
(38)
(38)
(450)
(450)
(40)
(40)
$
1,341
$ 1,341
$
1,182
$ 1,182
160
160
448
448
(195)
(195)
(44)
(44)
(11)
(11)
17
17
$
1,557
$ 1,557
At December 31, 2019 and 2018 there were $539 million and $991 million of unrecognized tax benefits that if recognized would
At December 31, 2019 and 2018 there were $539 million and $991 million of unrecognized tax benefits that if recognized would
favorably affect our effective tax rate in the future. In the years ended December 31, 2019, 2018 and 2017 income tax related
favorably affect our effective tax rate in the future. In the years ended December 31, 2019, 2018 and 2017 income tax related
interest and penalties were insignificant. At December 31, 2019 and 2018 we had liabilities of $117 million and $116 million for
interest and penalties were insignificant. At December 31, 2019 and 2018 we had liabilities of $117 million and $116 million for
income tax related interest and penalties.
income tax related interest and penalties.
At December 31, 2019 it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax
At December 31, 2019 it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax
benefits in the next twelve months.
benefits in the next twelve months.
Other Matters Income tax returns are filed in multiple jurisdictions and are subject to examination by taxing authorities
Other Matters Income tax returns are filed in multiple jurisdictions and are subject to examination by taxing authorities
throughout the world. We have open tax years from 2009 to 2019 with various significant tax jurisdictions. Tax authorities may
throughout the world. We have open tax years from 2009 to 2019 with various significant tax jurisdictions. Tax authorities may
have the ability to review and adjust net operating loss or tax credit carryforwards that were generated prior to these periods if
have the ability to review and adjust net operating loss or tax credit carryforwards that were generated prior to these periods if
utilized in an open tax year. These open years contain matters that could be subject to differing interpretations of applicable tax
utilized in an open tax year. These open years contain matters that could be subject to differing interpretations of applicable tax
laws and regulations as they relate to the amount, character, timing or inclusion of revenue and expenses or the sustainability of
laws and regulations as they relate to the amount, character, timing or inclusion of revenue and expenses or the sustainability of
income tax credits for a given audit cycle.
income tax credits for a given audit cycle.
y
The U.S. Tax Cuts and Jobs Act of 2017 (the Tax Act) was signed into law on December 22, 2017. The Tax Act changed many
The U.S. Tax Cuts and Jobs Act of 2017 (the Tax Act) was signed into law on December 22, 2017. The Tax Act changed many
aspects of U.S. corporate income taxation and included reduction of the corporate income tax rate from 35% to 21%, implementation
aspects ofU.S. corporate income taxation and included reduction of the corporate income tax rate from 35% to 21%, implementation
of a territorial tax system and imposition of a tax on deemed repatriated earnings of foreign subsidiaries. We recognized the tax
of a territorial tax system and imposition of a tax on deemed repatriated earnings of foreign subsidiaries. We recognized the tax
effects of the Tax Act in the year ended December 31, 2017 and recorded $7.3 billion in tax expense. The tax expense primarily
effects of the Tax Act in the year ended December 31, 2017 and recorded $7.3 billion in tax expense. The tax expense primarily
relates to the remeasurement of deferred tax assets to the 21% tax rate. We applied the guidance in SAB 118 when accounting for
relates to the remeasurement of deferred tax assets to the 21% tax rate. We applied the guidance in SAB 118 when accounting for
the enactment-date effects of the Tax Act in 2017 and 2018. During the year ended December 31, 2018 we reduced our year ended
the enactment-date effects of the Tax Act in 2017 and 2018. During the year ended December 31, 2018 we reduced our year ended
December 31, 2017 estimated tax expense of $7.3 billion to $7.1 billion, primarily related to the remeasurement of deferred tax
December 31, 2017 estimated tax expense of $7.3 billion to $7.1 billion, primarily related to the remeasurement of deferred tax
assets to the 21% tax rate.
assets to the 21% tax rate.
Note 18. Restructuring and Other Initiatives
Note 18. Restructuring and Other Initiatives
We have executed various restructuring and other initiatives and we may execute additional initiatives in the future, if necessary,
We have executed various restructuring and other initiatives and we may execute additional initiatives in the future, if necessary,
to streamline manufacturing capacity and reduce other costs to improve the utilization of remaining facilities. To the extent these
to streamline manufacturing capacity and reduce other costs to improve the utilization of remaining facilities. To the extent these
programs involve voluntary separations, a liability is generally recorded at the time offers to employees are accepted. To the extent
programs involve voluntary separations, a liability is generally recorded at the time offers to employees are accepted. To the extent
these programs provide separation benefits in accordance with pre-existing agreements, a liability is recorded once the amount is
these programs provide separation benefits in accordance with pre-existing agreements, a liability is recorded once the amount is
probable and reasonably estimable. If employees are involuntarily terminated, a liability is generally recorded at the communication
probable and reasonably estimable. If employees are involuntarily terminated, a liability is generally recorded at the communication
date. Related charges are recorded in Automotive and other cost of sales and Automotive and other selling, general and administrative
date. Related charges are recorded in Automotive and other cost of sales and Automotive and other selling, general and administrative
expense.
expense.
t
tt
84
84
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table summarizes the reserves and charges related to restructuring and other initiatives, including postemployment
The following table summarizes the reserves and charges related to restructuring and other initiatives, including postemployment
benefit reserves and charges:
benefit reserves and charges:
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,122
Balance at beginning of period $ 1,122
Additions, interest accretion and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
629
Additions, interest accretion and other 629
(1,101)
Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Payments (1,101)
(86)
Revisions to estimates and effect of foreign currency. . . . . . . . . . . . . . . . . . .
Revisions to estimates and effect of foreign currency (86)
Balance at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
564
Balance at end of period $ 564
$
227
$ 227
1,637
1,637
(600)
(600)
(142)
(142)
$
1,122
$ 1,122
$
268
$ 268
330
330
(315)
(315)
(56)
(56)
$
227
$ 227
In the year ended December 31, 2019, restructuring and other initiatives primarily included actions related to our announced
In the year ended December 31, 2019, restructuring and other initiatives primarily included actions related to our announced
transformation activities, which include unallocation of products to certain manufacturing facilities and other employee separation
transformation activities, which include unallocation of products to certain manufacturing facilities and other employee separation
programs. We recorded charges of $1.8 billion, primarily in GMNA, in the year ended December 31, 2019 consisting of $1.3
programs. We recorded charges of $1.8 billion, primarily in GMNA, in the year ended December 31, 2019 consisting of $1.3
billion primarily in non-cash accelerated depreciation and pension curtailment and other charges, not reflected in the table above,
billion primarily in non-cash accelerated depreciation and pension curtailment and other charges, not reflected in the table above,
and $535 million primarily in supplier-related charges and employee-related separation charges, which are reflected in the table
and $535 million primarily in supplier-related charges and employee-related separation charges, which are reflected in the table
above. We recorded charges of $1.3 billion, primarily in GMNA, in the year ended December 31, 2018 consisting of $1.0 billion
above. We recorded charges of $1.3 billion, primarily in GMNA, in the year ended December 31, 2018 consisting of $1.0 billion
in employee separations and other charges, which are reflected in the table above, and $301 million primarily in non-cash accelerated
in employee separations and other charges, which are reflected in the table above, and $301 million primarily in non-cash accelerated
depreciation, not reflected in the table above. These programs have a total cost since inception of $3.1 billion and were complete
depreciation, not reflected in the table above. These programs have a total cost since inception of $3.1 billion and were complete
at December 31, 2019. We incurred $1.1 billion in cash outflows resulting from these restructuring actions, primarily for employee
at December 31, 2019. We incurred $1.1 billion in cash outflows resulting from these restructuring actions, primarily for employee
separation payments and supplier-related payments in the year ended December 31, 2019. We expect additional cash outflows
separation payments and supplier-related payments in the year ended December 31, 2019. We expect additional cash outflows
related to these activities of approximately $400 million to be substantially complete by the end of 2020.
related to these activities of approximately $400 million to be substantially complete by the end of 2020.
In the year ended December 31, 2018, restructuring and other initiatives in GMI primarily included the closure of a facility and
In the year ended December 31, 2018, restructuring and other initiatives in GMI primarily included the closure of a facility and
other restructuring actions in Korea and employee separation programs. We recorded charges of $1.0 billion related to Korea, net
other restructuring actions in Korea and employee separation programs. We recorded charges of $1.0 billion related to Korea, net
of noncontrolling interests. These charges consisted of $537 million in non-cash asset impairments and other charges, not reflected
of noncontrolling interests. These charges consisted of $537 million in non-cash asset impairments and other charges, not reflected
in the table above, and $495 million in employee separation charges, which are reflected in the table above. We incurred $775
in the table above, and $495 million in employee separation charges, which are reflected in the table above. We incurred $775
million in cash outflows resulting from these Korea restructuring actions, primarily for employee separations and statutory pension
million in cash outflows resulting from these Korea restructuring actions, primarily for employee separations and statutory pension
payments in the year ended December 31, 2018. These programs were substantially complete at December 31, 2018.
payments in the year ended December 31, 2018. These programs were substantially complete at December 31, 2018.
In the year ended December 31, 2017, restructuring and other initiatives primarily included restructuring actions announced in
In the year ended December 31, 2017, restructuring and other initiatives primarily included restructuring actions announced in
the three months ended June 30, 2017 in GMI. These actions primarily related to the withdrawal of Chevrolet from the Indian and
the three months ended June 30, 2017 in GMI. These actions primarily related to the withdrawal of Chevrolet from the Indian and
South African markets at the end of 2017 and the transition of our South Africa manufacturing operations to Isuzu Motors. We
South African markets at the end of 2017 and the transition of our South Africa manufacturing operations to Isuzu Motors. We
continue to manufacture vehicles in India for sale to certain export markets. We recorded charges of $460 million in GMI primarily
continue to manufacture vehicles in India for sale to certain export markets. We recorded charges of $460 million in GMI primarily
consisting of $297 million of asset impairments, sales incentives, inventory provisions and other charges, not reflected in the table
consisting of $297 million of asset impairments, sales incentives, inventory provisions and other charges, not reflected in the table
above, and $163 million of dealer restructurings, employee separations and other contract cancellation costs, which are reflected
above, and $163 million of dealer restructurings, employee separations and other contract cancellation costs, which are reflected
in the table above. We completed these programs in GMI in 2017. Other GMI restructuring programs reflected in the table above
in the table above. We completed these programs in GMI in 2017. Other GMI restructuring programs reflected in the table above
include separation and other programs in Australia, Korea and India and the withdrawal of the Chevrolet brand from Europe.
include separation and other programs in Australia, Korea and India and the withdrawal of the Chevrolet brand from Europe.
Collectively, these programs had a total cost of $892 million since inception in 2013 through the completion of the programs in
Collectively, these programs had a total cost of $892 million since inception in 2013 through the completion of the programs in
the year ended December 31, 2017.
the year ended December 31, 2017.
Note 19. Interest Income and Other Non-Operating Income
Note 19. Interest Income and Other Non-Operating Income
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Non-service pension and OPEB income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
797
Non-service pension and OPEB income $ 797
$
1,665
$ 1,665
$
1,316
$ 1,316
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
429
Interest income 429
Licensing agreements income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
165
Licensing agreements income 165
335
335
296
296
266
266
74
74
Revaluation of investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
80
Revaluation of investments 80
(2)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other (2)
Total interest income and other non-operating income, net . . . . . . . . . . . . . . $
1,469
Total interest income and other non-operating income, net $ 1,469
258
258
42
42
$
2,596
$ 2.596
(56)
(56)
45
45
$
1,645
S 1,645
85
85
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 20. Stockholders’ Equity and Noncontrolling Interests
Note 20. Stockholders' Equity and Noncontrolling Interests
Preferred and Common Stock We have 2.0 billion shares of preferred stock and 5.0 billion shares of common stock authorized
Preferred and Common Stock We have 2.0 billion shares of preferred stock and 5.0 billion shares of common stock authorized
for issuance. At December 31, 2019 and 2018 we had no shares of preferred stock and 1.4 billion shares of common stock issued
for issuance. At December 31, 2019 and 2018 we had no shares of preferred stock and 1.4 billion shares of common stock issued
and outstanding.
and outstanding.
Common Stock Holders of our common stock are entitled to dividends at the sole discretion of our Board of Directors. Our
Common Stock Holders of our common stock are entitled to dividends at the sole discretion of our Board of Directors. Our
dividends declared per common share were $1.52 and our total dividends paid on common stock were $2.2 billion
$2.1 billion
dividends declared per common share were $1.52 and our total dividends paid on common stock were $2.2 billion, $2.1 billion
$2.2 billion for the years ended December 31, 2019, 2018 and 2017. Holders of common stock are entitled to one vote per
dand $
and $2.2 billion for the years ended December 31, 2019, 2018 and 2017. Holders of common stock are entitled to one vote per
share on all matters submitted to our stockholders for a vote. The liquidation rights of holders of our common stock are secondary
share on all matters submitted to our stockholders for a vote. The liquidation rights of holders of our common stock are secondary
to the payment or provision for payment of all our debts and liabilities and to holders of our preferred stock, if any such shares
to the payment or provision for payment of all our debts and liabilities and to holders of our preferred stock, if any such shares
are then outstanding.
are then outstanding.
for the years ended December 31, 2019, 2018 and 2017.
and our total dividends paid on common stock were
billi
billi
, $
a
In the year ended December 31, 2019, we did not purchase shares of our outstanding common stock. In the years ended December
In the year ended December 31,2019, we did not purchase shares of our outstanding common stock. In the years ended December
31, 2018 and 2017, we purchased three million and 120 million shares of our outstanding common stock for $100 million and
31, 2018 and 2017, we purchased three million and 120 million shares of our outstanding common stock for $100 million and
$4.5 billion as part of the common stock repurchase program announced in March 2015, which our Board of Directors increased
$4.5 billion as part of the common stock repurchase program announced in March 2015, which our Board of Directors increased
and extended in January 2016 and January 2017.
and extended in January 2016 and January 2017.
Warrants At December 31, 2018 we had 15 million warrants outstanding that we issued in July 2009. The warrants have expired
Warrants At December 31,2018 we had 15 million warrants outstanding that we issued in July 2009. The warrants have expired
but were exercisable at any time prior to July 10, 2019 at an exercise price of $18.33 per share.
but were exercisable at any time prior to July 10, 2019 at an exercise price of $18.33 per share.
GM Financial Preferred Stock In September 2018 GM Financial issued $500 million of Fixed-to-Floating Rate Cumulative
GM Financial Preferred Stock In September 2018 GM Financial issued $500 million of Fixed-to-Floating Rate Cumulative
Perpetual Preferred Stock, Series B, $0.01 par value, with a liquidation preference of $1,000 per share. The preferred stock is
Perpetual Preferred Stock, Series B, $0.01 par value, with a liquidation preference of $1,000 per share. The preferred stock is
classified as noncontrolling interests in our consolidated financial statements. Dividends are paid semi-annually when declared,
classified as noncontrolling interests in our consolidated financial statements. Dividends are paid semi-annually when declared,
which started March 30, 2019 at a fixed rate of 6.50%.
which started March 30, 2019 at a fixed rate of 6.50%.
In September 2017 GM Financial issued $1.0 billion of Fixed-to-Floating Rate Cumulative Perpetual Preferred Stock, Series
In September 2017 GM Financial issued $1.0 billion of Fixed-to-Floating Rate Cumulative Perpetual Preferred Stock, Series
A, $0.01 par value, with a liquidation preference of $1,000 per share. The preferred stock is classified as noncontrolling interests
A, $0.01 par value, with a liquidation preference of $1,000 per share. The preferred stock is classified as noncontrolling interests
in our consolidated financial statements. Dividends are paid semi-annually when declared, which started March 30, 2018 at a fixed
in our consolidated fmancial statements. Dividends are paid semi-annually when declared, which started March 30, 2018 at a fixed
rate of 5.75%.
rate of 5.75%.
Cruise Preferred Shares In 2019 Cruise Holdings entered into a Purchase Agreement with The Vision Fund, General Motors
Cruise Preferred Shares In 2019 Cruise Holdings entered into a Purchase Agreement with The Vision Fund, General Motors
Holdings LLC, Honda and certain other investors pursuant to which Cruise Holdings received $1.2 billion, including $687 million
Holdings LLC, Honda and certain other investors pursuant to which Cruise Holdings received $1.2 billion, including $687 million
from General Motors Holdings LLC, in exchange for issuing Cruise Class F Preferred Shares, representing approximately 6.6%
from General Motors Holdings LLC, in exchange for issuing Cruise Class F Preferred Shares, representing approximately 6.6%
of the fully diluted equity in Cruise Holdings. All proceeds related to the Cruise Class F Preferred Shares are designated exclusively
of the fully diluted equity in Cruise Holdings. All proceeds related to the Cruise Class F Preferred Shares are designated exclusively
for working capital and general corporate purposes of Cruise. The Cruise Class F Preferred Shares participate pari passu with
for working capital and general corporate purposes of Cruise. The Cruise Class F Preferred Shares participate pari passu with
holders of Cruise Holdings common stock in any dividends declared. The Cruise Class F Preferred Shares have the right to vote
holders of Cruise Holdings common stock in any dividends declared. The Cruise Class F Preferred Shares have the right to vote
on the election of one director, who is elected by the vote of a majority of the Cruise Holdings common stock and the Cruise Class
on the election of one director, who is elected by the vote of a majority of the Cruise Holdings common stock and the Cruise Class
F Preferred Shares. Prior to an initial public offering, the holders of Cruise Class F Preferred Shares are restricted from transferring
F Preferred Shares. Prior to an initial public offering, the holders of Cruise Class F Preferred Shares are restricted from transferring
the Cruise Class F Preferred Shares until May 7, 2023. The Cruise Class F Preferred Shares only convert into common stock of
the Cruise Class F Preferred Shares until May 7, 2023. The Cruise Class F Preferred Shares only convert into common stock of
Cruise Holdings, at specified exchange ratios, upon occurrence of an initial public offering. No covenants or other events of default
Cruise Holdings, at specified exchange ratios, upon occurrence of an initial public offering. No covenants or other events of default
that can trigger redemption of the Class F Preferred Shares exist. The Cruise Class F Preferred Shares are entitled to receive the
that can trigger redemption of the Class F Preferred Shares exist. The Cruise Class F Preferred Shares are entitled to receive the
greater of their carrying value or a pro-rata share of any proceeds or distributions upon the occurrence of a merger, sale, liquidation,
greater of their carrying value or a pro-rata share of any proceeds or distributions upon the occurrence of a merger, sale, liquidation,
or dissolution of Cruise Holdings. The Cruise Class F Preferred Shares are classified as noncontrolling interests in our consolidated
or dissolution of Cruise Holdings. The Cruise Class F Preferred Shares are classified as noncontrolling interests in our consolidated
financial statements. At December 31, 2019, external investors held 17.3% of the fully diluted equity in Cruise Holdings.
fmancial statements. At December 31, 2019, external investors held 17.3% of the fully diluted equity in Cruise Holdings.
qq
In June 2018, Cruise Holdings issued $900 million of convertible preferred shares (Cruise Preferred Shares) to an affiliate of
In June 2018, Cruise Holdings issued $900 million of convertible preferred shares (Cruise Preferred Shares) to an affiliate of
The Vision Fund which subsequently assigned such shares to The Vision Fund. Immediately prior to the issuance of the Cruise
The Vision Fund which subsequently assigned such shares to The Vision Fund. Immediately prior to the issuance of the Cruise
Preferred Shares, we invested $1.1 billion in Cruise Holdings. When Cruise's autonomous vehicles are ready for commercial
Preferred Shares, we invested $1.1 billion in Cruise Holdings. When Cruise's autonomous vehicles are ready for commercial
deployment, The Vision Fund is obligated to purchase additional Cruise Preferred Shares for $1.35 billion. All proceeds are
deployment, The Vision Fund is obligated to purchase additional Cruise Preferred Shares for $1.35 billion. All proceeds are
designated exclusively for working capital and general corporate purposes of Cruise. Dividends are cumulative and accrue at an
designated exclusively for working capital and general corporate purposes of Cruise. Dividends are cumulative and accrue at an
annual rate of 7.0% and are payable quarterly in cash or in-kind, at Cruise's discretion. The Cruise Preferred Shares are also entitled
annual rate of 7.0% and are payable quarterly in cash or in-kind, at Cruise's discretion. The Cruise Preferred Shares are also entitled
to participate in Cruise dividends above a defined threshold. Prior to an initial public offering, The Vision Fund is restricted from
to participate in Cruise dividends above a defmed threshold. Prior to an initial public offering, The Vision Fund is restricted from
transferring the Cruise Preferred Shares until June 28, 2025. The Cruise Preferred Shares are classified as noncontrolling interests
transferring the Cruise Preferred Shares until June 28, 2025. The Cruise Preferred Shares are classified as noncontrolling interests
in our consolidated financial statements.
in our consolidated fmancial statements.
86
86
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Cruise Common Shares In October 2018, Cruise Holdings entered into a Purchase Agreement with Honda, pursuant to which
Cruise Common Shares In October 2018, Cruise Holdings entered into a Purchase Agreement with Honda, pursuant to which
Honda invested $750 million in Cruise Holdings in exchange for Class E Common Shares, representing 5.7% of the fully diluted
Honda invested $750 million in Cruise Holdings in exchange for Class E Common Shares, representing 5.7% of the fully diluted
equity of Cruise Holdings at closing. In addition, Honda agreed to contribute approximately $2.0 billion primarily in the form of
equity of Cruise Holdings at closing. In addition, Honda agreed to contribute approximately $2.0 billion primarily in the form of
a long-term annual fee to Cruise Holdings for certain rights to use Cruise Holdings' trade names and trademarks and the exclusive
a long-term annual fee to Cruise Holdings for certain rights to use Cruise Holdings' trade names and trademarks and the exclusive
right to partner with Cruise Holdings to develop, deploy, and maintain a foreign market. The remaining contribution or funding
right to partner with Cruise Holdings to develop, deploy, and maintain a foreign market. The remaining contribution or funding
will come in the form of shared development costs for a shared autonomous vehicle that Honda, General Motors Holdings LLC
will come in the form of shared development costs for a shared autonomous vehicle that Honda, General Motors Holdings LLC
and Cruise Holdings will jointly develop for deployment onto Cruise's autonomous vehicle network. All proceeds are designated
and Cruise Holdings will jointly develop for deployment onto Cruise's autonomous vehicle network. All proceeds are designated
exclusively for working capital and general corporate purposes of Cruise. At the later of October 3, 2025 or the termination of the
exclusively for working capital and general corporate purposes of Cruise. At the later of October 3, 2025 or the termination of the
commercial agreements between Cruise Holdings and Honda, Cruise Holdings can call all, but not less than all of the Class E
commercial agreements between Cruise Holdings and Honda, Cruise Holdings can call all, but not less than all of the Class E
Common Shares at an amount equal to the then fair value of Cruise Holdings. The Class E Common Shares are classified as
Common Shares at an amount equal to the then fair value of Cruise Holdings. The Class E Common Shares are classified as
noncontrolling interests in our consolidated financial statements.
noncontrolling interests in our consolidated fmancial statements.
f
GM Korea Preferred Shares In the year ended December 31, 2018, the Korea Development Bank (KDB) purchased $720
GM Korea Preferred Shares In the year ended December 31, 2018, the Korea Development Bank (KDB) purchased $720
million of GM Korea's Class B Preferred Shares (GM Korea Preferred Shares). Dividends on the GM Korea Preferred Shares are
million of GM Korea's Class B Preferred Shares (GM Korea Preferred Shares). Dividends on the GM Korea Preferred Shares are
cumulative and accrue at an annual rate of 1.0%. GM Korea can call the preferred shares at their original issue price six years from
cumulative and accrue at an annual rate of 1.0%. GM Korea can call the preferred shares at their original issue price six years from
the date of issuance and once called, the preferred shares can be converted into common shares of GM Korea at the option of the
the date of issuance and once called, the preferred shares can be converted into common shares of GM Korea at the option of the
holder. The GM Korea Preferred Shares are classified as noncontrolling interests in our consolidated financial statements. The
holder. The GM Korea Preferred Shares are classified as noncontrolling interests in our consolidated fmancial statements. The
KDB investment proceeds can only be used for purposes of funding capital expenditures in GM Korea. In conjunction with the
KDB investment proceeds can only be used for purposes of funding capital expenditures in GM Korea. In conjunction with the
GM Korea Preferred Share issuance we agreed to provide GM Korea future funding, if needed, not to exceed $2.8 billion through
GM Korea Preferred Share issuance we agreed to provide GM Korea future funding, if needed, not to exceed $2.8 billion through
December 31, 2027, inclusive of $2.0 billion of planned capital expenditures through 2027.
December 31, 2027, inclusive of $2.0 billion of planned capital expenditures through 2027.
The following table summarizes the significant components of Accumulated other comprehensive loss:
The following, table summarizes the significant components of Accumulated other comprehensive loss:
Foreign Currency Translation Adjustments
Foreign Currency Translation Adjustments
Years Ended December 31,
Years Ended December 31,
2018
2018
2017
2017
2019
2019
Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(2,355)
Balance at beginning of period $ (2,250) $ (1,606) $ (2,355)
Other comprehensive income (loss) and noncontrolling interests before
Other comprehensive income (loss) and noncontrolling interests before
(1,606) $
(2,250) $
reclassification adjustment, net of tax and impact of adoption of accounting
reclassification adjustment, net of tax and impact of adoption of accounting
(56)
standards(a)(b) (56)
standards(a)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reclassification adjustment, net of tax(a) 28
Reclassification adjustment, net of tax(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
28
Other comprehensive income (loss), net of tax(a) . . . . . . . . . . . . . . . . . . . . . . . . .
(28)
Other comprehensive income (loss), net of tax(a) (28)
(664)
(664)
20
20
(644)
(644)
560
560
189
189
749
749
Balance at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(1,606)
Balance at end of period $ (2.278) $ (2,250) $ (1.606)
(2,278) $
(2,250) $
Defined Benefit Plans
Defined Benefit Plans
Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(6,968)
Balance at beginning of period $ (6,737) $ (6,398) $ (6,968)
(6,737) $
(6,398) $
Other comprehensive loss and noncontrolling interests before reclassification
Other comprehensive loss and noncontrolling interests before reclassification
adjustment, net of impact of adoption of accounting standards(b) . . . . . . . . . .
adjustment, net of impact of adoption of accounting standards(b)
Tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
463
Tax benefit 463
Other comprehensive loss and noncontrolling interests before reclassification
Other comprehensive loss and noncontrolling interests before reclassification
(2,769)
(2,769)
adjustment, net of tax and impact of adoption of accounting standards(b) . . . .
adjustment, net of tax and impact of adoption of accounting standards(b) . . .
Reclassification adjustment, net of tax(a)(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
184
Reclassification adjustment, net of tax(a)(c) 184
Other comprehensive income (loss), net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,122)
Other comprehensive income (loss), net of tax (2,122)
(2,306)
(2,306)
(580)
(580)
100
100
(480)
(480)
141
141
(339)
(339)
(798)
(798)
98
98
(700)
(700)
1,270
1,270
570
570
Balance at end of period(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(6,398)
Balance at end of period(d) $ (8,859) $ (6,737) $ (6.398)
(6,737) $
(8,859) $
__________
(a) The income tax effect was insignificant in the years ended December 31, 2019, 2018 and 2017.
(a) The income tax effect was insignificant in the years ended December 31, 2019,2018 and 2017.
(b) The noncontrolling interests are insignificant in the years ended December 31, 2019, 2018 and 2017.
(b) The noncontrolling interests are insignificant in the years ended December 31, 2019, 2018 and 2017.
(c) $1.2 billion is included in the loss on sale of the Opel/Vauxhall Business in the year ended December 31, 2017. An insignificant amount is
(c) $1.2 billion is included in the loss on sale of the Opel/Vauxhall Business in the year ended December 31, 2017. An insignificant amount is
ff
included in the computation of periodic pension and OPEB (income) expense in the year ended December 31, 2017.
included in the computation of periodic pension and OPEB (income) expense in the year ended December 31, 2017.
(d) Primarily consists of unamortized actuarial loss on our defined benefit plans. Refer to the critical accounting estimates section of our MD&A
(d) Primarily consists of unamortized actuarial loss on our defined benefit plans. Refer to the critical accounting estimates section of our MD&A
for additional information.
for additional information.
87
87
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 21. Earnings Per Share
Note 21. Earnings Per Share
Basic and diluted earnings (loss) per share are computed by dividing Net income (loss) attributable to common stockholders by
Basic and diluted earnings (loss) per share are computed by dividing Net income (loss) attributable to common stockholders by
the weighted-average common shares outstanding in the period. Diluted earnings (loss) per share is computed by giving effect to
the weighted-average common shares outstanding in the period. Diluted earnings (loss) per share is computed by giving effect to
all potentially dilutive securities that are outstanding.
all potentially dilutive securities that are outstanding.
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Basic earnings per share
Basic earnings per share
Income from continuing operations(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
6,732
Income from continuing operations(a) $ 6,732
(151)
Less: cumulative dividends on subsidiary preferred stock . . . . . . . . . . . . . . .
Less: cumulative dividends on subsidiary preferred stock (151)
6,581
Income from continuing operations attributable to common stockholders . . .
6,581
Income from continuing operations attributable to common stockholders . .
Loss from discontinued operations, net of tax. . . . . . . . . . . . . . . . . . . . . . . . .
—
Loss from discontinued operations, net of tax
Net income (loss) attributable to common stockholders . . . . . . . . . . . . . . . . . $
6,581
Net income (loss) attributable to common stockholders $ 6,581
$
8,084
$ 8,084
(98)
(98)
7,986
7,986
70
70
$
7,916
$ 7,916
$
348
$ 348
(16)
(16)
332
332
4,212
4,212
(3,880)
$
$ (3,880)
Weighted-average common shares outstanding . . . . . . . . . . . . . . . . . . . . . . .
1,424
Weighted-average common shares outstanding 1,424
1,411
1,411
1,465
1,465
$
Basic earnings per common share – continuing operations . . . . . . . . . . . . . . $
5.66
4.62
$ 5.66
Basic earnings per common share — continuing operations $ 4.62
Basic loss per common share – discontinued operations . . . . . . . . . . . . . . . . $
0.05
Basic loss per common share — discontinued operations $ — $ 0.05
$
Basic earnings (loss) per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
5.61
4.62
$ 5.61
Basic earnings (loss) per common share $ 4.62
Diluted earnings per share
Diluted earnings per share
Income from continuing operations attributable to common stockholders –
Income from continuing operations attributable to common stockholders —
— $
diluted(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
6,581
diluted(a) $ 6,581
Loss from discontinued operations, net of tax – diluted . . . . . . . . . . . . . . . . . $
Loss from discontinued operations, net of tax — diluted $
6,581
Net income (loss) attributable to common stockholders – diluted . . . . . . . . . $
Net income (loss) attributable to common stockholders — diluted $ 6,581
— $
$
7,986
$ 7,986
70
$ 70
$
7,916
$ 7,916
$
0.23
$ 0.23
$
2.88
$ 2.88
(2.65)
$
$ (2.65)
$
332
$ 332
$
4,212
$ 4,212
(3,880)
$
$ (3,880)
Weighted-average common shares outstanding – basic . . . . . . . . . . . . . . . . .
1,424
Weighted-average common shares outstanding — basic 1,424
15
Dilutive effect of warrants and awards under stock incentive plans . . . . . . . .
15
Dilutive effect of warrants and awards under stock incentive plans
Weighted-average common shares outstanding – diluted . . . . . . . . . . . . . . . .
1,439
Weighted-average common shares outstanding — diluted 1,439
1,411
1,411
20
20
1,431
1,431
1,465
1,465
27
27
1,492
1,492
$
Diluted earnings per common share – continuing operations . . . . . . . . . . . . . $
5.58
4.57
$ 5.58
Diluted earnings per common share — continuing operations $ 4.57
Diluted loss per common share – discontinued operations . . . . . . . . . . . . . . . $
0.05
Diluted loss per common share — discontinued operations $ — $ 0.05
$
Diluted earnings (loss) per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . $
5.53
4.57
$ 5.53
Diluted earnings (loss) per common share $ 4.57
— $
$
0.22
$ 0.22
$
2.82
$ 2.82
(2.60)
$
$ (2.60)
Potentially dilutive securities(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7
Potentially dilutive securities(b) 7
9
9
—
__________
(a) Net of Net loss attributable to noncontrolling interests.
(a) Net of Net loss attributable to noncontrolling interests.
(b) Potentially dilutive securities attributable to outstanding stock options were excluded from the computation of diluted EPS because the
(b) Potentially dilutive securities attributable to outstanding stock options were excluded from the computation of diluted BPS because the
securities would have had an antidilutive effect.
securities would have had an antidilutive effect.
Note 22. Discontinued Operations
Note 22. Discontinued Operations
On July 31, 2017, we closed the sale of our Opel/Vauxhall Business to PSA Group. On October 31, 2017, we closed the sale of
On July 31, 2017, we closed the sale of our Opel/Vauxhall Business to PSA Group. On October 31, 2017, we closed the sale of
the Fincos to Banque PSA Finance S.A. and BNP Paribas Personal Finance S.A.
the Fincos to Banque PSA Finance S.A. and BNP Paribas Personal Finance S.A.
The net consideration paid at closing for the European Business was $2.5 billion, inclusive of $808 million in warrants in PSA
The net consideration paid at closing for the European Business was $2.5 billion, inclusive of $808 million in warrants in PSA
Group. The total charge from the sale of the European Business during the year ended December 31, 2017 was $6.2 billion, net
Group. The total charge from the sale of the European Business during the year ended December 31, 2017 was $6.2 billion, net
of tax, of which $3.9 billion was recorded in Loss from discontinued operations, net of tax, and $2.3 billion was recorded in Income
of tax, of which $3.9 billion was recorded in Loss from discontinued operations, net of tax, and $2.3 billion was recorded in Income
tax expense. PSA Group assumed approximately $3.1 billion of net underfunded pension liabilities primarily with respect to active
tax expense. PSA Group assumed approximately $3.1 billion of net underfunded pension liabilities primarily with respect to active
employees of the Opel/Vauxhall Business, and during the year ended December 31, 2017 our wholly-owned subsidiary (the Seller)
employees of the Opel/Vauxhall Business, and during the year ended December 31, 2017 our wholly-owned subsidiary (the Seller)
made payments to PSA Group, or one or more pension funding vehicles, of $3.4 billion in respect of these assumed liabilities.
made payments to PSA Group, or one or more pension funding vehicles, of $3.4 billion in respect of these assumed liabilities.
The Seller agreed to indemnify PSA Group for certain losses resulting from any inaccuracy of the representations and warranties
The Seller agreed to indemnify PSA Group for certain losses resulting from any inaccuracy of the representations and warranties
or breaches of our covenants included in the Agreement and for certain other liabilities including certain emissions and product
or breaches of our covenants included in the Agreement and for certain other liabilities including certain emissions and product
liabilities. The Company entered into a guarantee for the benefit of PSA Group and pursuant to which the Company agreed to
liabilities. The Company entered into a guarantee for the benefit of PSA Group and pursuant to which the Company agreed to
88
88
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
guarantee the Seller's obligation to indemnify PSA Group. Certain of these indemnification obligations are subject to time
guarantee the Seller's obligation to indemnify PSA Group. Certain of these indemnification obligations are subject to time
limitations, thresholds and/or caps as to the amount of required payments.
limitations, thresholds and/or caps as to the amount of required payments.
Although the sale reduced our new vehicle presence in Europe, we may still be impacted by actions taken by regulators related
Although the sale reduced our new vehicle presence in Europe, we may still be impacted by actions taken by regulators related
to vehicles sold before the sale. In Germany, the Kraftfahrt-Bundesamt (KBA) issued an order in November 2019, which converted
to vehicles sold before the sale. In Germany, the Kraftfahrt-Bundesamt (KBA) issued an order in November 2019, which converted
a voluntary recall initiated by Opel in 2017 and 2018 into a mandatory recall for allegedly failing to comply with certain emissions
a voluntary recall initiated by Opel in 2017 and 2018 into a mandatory recall for allegedly failing to comply with certain emissions
regulations. However, because the overwhelming majority of vehicles have already received KBA-approved software calibration
regulations. However, because the overwhelming majority of vehicles have already received KBA-approved software calibration
updates pursuant to the voluntary recall, the number of vehicles subject to the mandatory recall is insignificant. The Seller may
updates pursuant to the voluntary recall, the number of vehicles subject to the mandatory recall is insignificant. The Seller may
also be obligated to indemnify PSA Group or otherwise absorb costs and expenses resulting from the foregoing as well as certain
also be obligated to indemnify PSA Group or otherwise absorb costs and expenses resulting from the foregoing as well as certain
related potential litigation costs, settlements, judgments and potential fines. In addition, at the KBA's request, the German authorities
related potential litigation costs, settlements, judgments and potential fmes. In addition, at the KBA's request, the German authorities
re-opened a separate criminal investigation related to this matter that had previously been closed with no action. We are unable to
re-opened a separate criminal investigation related to this matter that had previously been closed with no action. We are unable to
estimate any reasonably possible loss or range of loss that may result from this matter.
estimate any reasonably possible loss or range of loss that may result from this matter.
aa
We continue to purchase from and supply to PSA Group certain vehicles, parts and engineering services for a period of time
We continue to purchase from and supply to PSA Group certain vehicles, parts and engineering services for a period of time
following closing. The following table summarizes transactions with the Opel/Vauxhall Business:
following closing. The following table summarizes transactions with the Opel/Vauxhall Business:
Years Ended December 31,
Years Ended December 31,
2019
2019
2018
2018
2017
2017
Net sales and revenue(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,129
Net sales and revenue(a) $ 1,129
Purchases and expenses(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
825
Purchases and expenses(a) $ 825
Cash payments(b) $ 975
975
Cash payments(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Cash receipts(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,408
Cash receipts(b) $ 1,408
__________
(a) Included in Income from continuing operations.
(a) Included in Income from continuing operations.
(b) Included in Net cash provided by operating activities - continuing operations.
(b) Included in Net cash provided by operating activities – continuing operations.
–
$
1,939
$ 1,939
$
1,422
$ 1,422
1,849
$
$ 1,849
$
2,310
$ 2,310
$
853
$ 853
$
218
$ 218
242
$
$ 242
$
1,161
$ 1,161
The following table summarizes the results of the European Business operations:
The following table summarizes the results of the European Business operations:
Years Ended December 31,
Years Ended December 31,
2018
2018
2017
2017
2019
2019
11,257
Automotive net sales and revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
— $
11,257
Automotive net sales and revenue
GM Financial net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
466
466
GM Financial net sales and revenue
—
11,723
Total net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total net sales and revenue 11,723
11,049
Automotive and other cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
11,049
Automotive and other cost of sales
342
GM Financial interest, operating and other expenses . . . . . . . . . . . . . . . . . . .
—
342
GM Financial interest, operating and other expenses
813
Automotive and other selling, general, and administrative expense . . . . . . . .
—
813
Automotive and other selling, general, and administrative expense
—
)
(
(72)
Other expense items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(72)
Other expense items
553
—
Loss from discontinued operations before taxes . . . . . . . . . . . . . . . . . . . . . . .
553
Loss from discontinued operations before taxes
2,176
70
Loss on sale of discontinued operations before taxes(a)(b) . . . . . . . . . . . . . .
2,176
70
Loss on sale of discontinued operations before taxes(a)(b)
2,729
Total loss from discontinued operations before taxes . . . . . . . . . . . . . . . . . . .
70
2,729
70
Total loss from discontinued operations before taxes
1,483
—
Income tax expense(b)(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,483
Income tax expense(b)(c)
$
Loss from discontinued operations, net of tax. . . . . . . . . . . . . . . . . . . . . . . . . $
,
4,212
70
$ 4.212
Loss from discontinued operations, net of tax — _$70
__________
(a) Includes contract cancellation charges associated with the disposal for the year ended December 31, 2017.
(a) Includes contract cancellation charges associated with the disposal for the year ended December 31, 2017.
(b) Total loss on sale of discontinued operations, net of tax was $3.9 billion for the year ended December 31, 2017.
(b) Total loss on sale of discontinued operations, net of tax was $3.9 billion for the year ended December 31, 2017.
(c) Includes $2.0 billion of deferred tax assets that transferred to PSA Group in the year ended December 31, 2017.
(c) Includes $2.0 billion of deferred tax assets that transferred to PSA Group in the year ended December 31, 2017.
— $
—
—
—
—
—
—
—
—
—
—
— $
Note 23. Stock Incentive Plans
Note 23. Stock Incentive Plans
GM Stock Incentive Awards We grant to certain employees RSUs, RSAs, PSUs and stock options (collectively, stock incentive
GM Stock Incentive Awards We grant to certain employees RSUs, RSAs, PSUs and stock options (collectively, stock incentive
awards) under our 2016 Equity Incentive Plan and 2017 Long-Term Incentive Plan (LTIP) and prior to the 2017 LTIP, under our
awards) under our 2016 Equity Incentive Plan and 2017 Long-Term Incentive Plan (LTIP) and prior to the 2017 LTIP, under our
2014 LTIP. The 2017 LTIP was approved by stockholders in June 2017 and replaced the 2014 LTIP. Shares awarded under the
2014 LTIP. The 2017 LTIP was approved by stockholders in June 2017 and replaced the 2014 LTIP. Shares awarded under the
plans are subject to forfeiture if the participant leaves the company for reasons other than those permitted under the plans such as
plans are subject to forfeiture if the participant leaves the company for reasons other than those permitted under the plans such as
retirement, death or disability.
retirement, death or disability.
89
89
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
RSU awards granted either cliff vest or ratably vest generally over a three-year service period, as defined in the terms of each
RSU awards granted either cliff vest or ratably vest generally over a three-year service period, as defmed in the terms of each
award. PSU awards vest at the end of a three-year performance period, based on performance criteria determined by the Executive
award. PSU awards vest at the end of a three-year performance period, based on performance criteria determined by the Executive
Compensation Committee of the Board of Directors at the time of award. The number of shares earned may equal, exceed or be
Compensation Committee of the Board of Directors at the time of award. The number of shares earned may equal, exceed or be
less than the targeted number of shares depending on whether the performance criteria are met, surpassed or not met. Stock options
less than the targeted number of shares depending on whether the performance criteria are met, surpassed or not met. Stock options
expire 10 years from the grant date. Our performance-based stock options vest ratably over 55 months based on the performance
expire 10 years from the grant date. Our performance-based stock options vest ratably over 55 months based on the performance
of our common stock relative to that of a specified peer group. Our service-based stock options vest ratably over 19 months to
of our common stock relative to that of a specified peer group. Our service-based stock options vest ratably over 19 months to
three years.
three years.
In connection with our acquisition of Cruise Automation, Inc. in May 2016, RSAs and PSUs in common shares of GM were
In connection with our acquisition of Cruise Automation, Inc. in May 2016, RSAs and PSUs in common shares of GM were
granted to employees of Cruise Holdings. The RSAs vest ratably, generally over a three-year service period. The PSUs are contingent
granted to employees of Cruise Holdings. The RSAs vest ratably, generally over a three-year service period. The PSUs are contingent
upon achievement of specific technology and commercialization milestones.
upon achievement of specific technology and commercialization milestones.
Weighted-Average
Weighted-Average
Grant Date Fair
Grant Date Fair
Value
Value
$
Units outstanding at January 1, 2019 . . . . . . . . . . . . . . . . . . . . . . . . .
48.1
19.81
$ 19.81
Units outstanding at January 1, 2019 48.1
27.89
$
8.9
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 27.89
Granted 8.9
(11.6) $
Settled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
28.78
Settled (11.6) $ 28.78
(3.9) $
30.87
Forfeited or expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Forfeited or expired (3.9) $ 30.87
19.17
$
41.5
Units outstanding at December 31, 2019(a) . . . . . . . . . . . . . . . . . . . .
$ 19.17
Units outstanding at December 31, 2019(a) 41.5
__________
(a) Includes the target amount of PSUs.
(a) Includes the target amount of PSUs.
Shares
Shares
(in millions)
(in millions)
Weighted-Average
Weighted-Average
Remaining
Remaining
Contractual Term
Contractual Term
in Years
in Years
1.3
1.3
0.9
0.9
Our weighted-average assumptions used to value our stock options are a dividend yield of 3.90%, 3.69% and 4.43%, expected
Our weighted-average assumptions used to value our stock options are a dividend yield of 3.90%, 3.69% and 4.43%, expected
volatility of 28.0%, 28.0% and 25.0%, a risk-free interest rate of 2.62%, 2.73% and 1.97%, and an expected option life of 6.00,
volatility of 28.0%, 28.0% and 25.0%, a risk-free interest rate of 2.62%, 2.73% and 1.97%, and an expected option life of 6.00,
5.98 and 5.84 years for options issued during the years ended December 31, 2019, 2018 and 2017.
5.98 and 5.84 years for options issued during the years ended December 31, 2019, 2018 and 2017.
Total compensation expense related to the above awards was $456 million, $316 million and $585 million in the years ended
Total compensation expense related to the above awards was $456 million, $316 million and $585 million in the years ended
December 31, 2019, 2018 and 2017.
December 31, 2019,2018 and 2017.
At December 31, 2019, the total unrecognized compensation expense for nonvested equity awards granted was $182 million.
At December 31, 2019, the total unrecognized compensation expense for nonvested equity awards granted was $182 million.
This expense is expected to be recorded over a weighted-average period of 1.1 years. The total fair value of stock incentive awards
This expense is expected to be recorded over a weighted-average period of 1.1 years. The total fair value of stock incentive awards
vested was $287 million, $317 million and $421 million in the years ended December 31, 2019, 2018 and 2017.
vested was $287 million, $317 million and $421 million in the years ended December 31, 2019, 2018 and 2017.
Cruise Stock Incentive Awards In addition to the awards noted above, stock options and RSUs were granted to Cruise employees
Cruise Stock Incentive Awards In addition to the awards noted above, stock options and RSUs were granted to Cruise employees
in common shares of Cruise Holdings in the years ended December 31, 2019 and 2018. These awards were granted under the 2018
in common shares of Cruise Holdings in the years ended December 31, 2019 and 2018. These awards were granted under the 2018
Employee Incentive Plan approved by Cruise Holdings' Board of Directors in August 2018. Shares awarded under the plan are
Employee Incentive Plan approved by Cruise Holdings' Board of Directors in August 2018. Shares awarded under the plan are
subject to forfeiture if the participant leaves the company for reasons other than those permitted under the plan. There were no
subject to forfeiture if the participant leaves the company for reasons other than those permitted under the plan. There were no
awards granted in Cruise common shares for the year ended December 31, 2017. Stock options vest ratably over four to 10 years,
awards granted in Cruise common shares for the year ended December 31, 2017. Stock options vest ratably over four to 10 years,
as defined in the terms of each award. Stock options expire 10 years from the grant date. RSU awards granted vest upon the
as defmed in the terms of each award. Stock options expire 10 years from the grant date. RSU awards granted vest upon the
satisfaction of both a service condition and a liquidity condition. The service condition for the majority of these awards is satisfied
satisfaction of both a service condition and a liquidity condition. The service condition for the majority of these awards is satisfied
over four years. The liquidity condition is satisfied upon the earlier of the date of a change in control transaction or the consummation
over four years. The liquidity condition is satisfied upon the earlier of the date of a change in control transaction or the consummation
of an initial public offering.
of an initial public offering.
Total compensation expense related to Cruise Holdings’ share-based awards was insignificant for the years ended December 31,
Total compensation expense related to Cruise Holdings' share-based awards was insignificant for the years ended December 31,
2019 and 2018. No share-based compensation expense had been recognized for the RSUs because the liquidity condition described
2019 and 2018. No share-based compensation expense had been recognized for the RSUs because the liquidity condition described
above was not met at December 31, 2019 and 2018. Total unrecognized compensation expense for Cruise Holdings’ nonvested
above was not met at December 31, 2019 and 2018. Total unrecognized compensation expense for Cruise Holdings' nonvested
equity awards granted was $680 million at December 31, 2019, which was primarily comprised of the RSUs for which the liquidity
equity awards granted was $680 million at December 31,2019, which was primarily comprised of the RSUs for which the liquidity
condition had not been met. Total units outstanding were 70.1 million at December 31, 2019. The expense related to stock options
condition had not been met. Total units outstanding were 70.1 million at December 31, 2019. The expense related to stock options
is expected to be recorded over a weighted-average period of 7.9 years. The timing of the expense related to RSUs will depend
is expected to be recorded over a weighted-average period of 7.9 years. The timing of the expense related to RSUs will depend
upon the date of the satisfaction of the liquidity condition.
upon the date of the satisfaction of the liquidity condition.
90
90
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 24. Supplementary Quarterly Financial Information (Unaudited)
Note 24. Supplementary Quarterly Financial Information (Unaudited)
The following tables summarize supplementary quarterly financial information:
The following tables summarize supplementary quarterly fmancial information:
1st Quarter
1st Quarter
2nd Quarter
2nd Quarter
3rd Quarter
3rd Quarter
4th Quarter
4th Quarter
2019
2019
Total net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
34,878
Total net sales and revenue $ 34,878
Automotive and other gross margin(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
3,032
Automotive and other gross margin(a) $ 3,032
Income (loss) from continuing operations. . . . . . . . . . . . . . . . . . . . . . . . . . $
2,145
Income (loss) from continuing operations $ 2,145
Net income (loss) attributable to stockholders . . . . . . . . . . . . . . . . . . . . . . $
2,157
Net income (loss) attributable to stockholders $ 2,157
Basic earnings (loss) per common share – continuing operations . . . . . . . $
1.50
Basic earnings (loss) per common share — continuing operations $ 1.50
1.48
Diluted earnings (loss) per common share – continuing operations . . . . . . $
Diluted earnings (loss) per common share — continuing operations $ 1.48
__________
(a) Includes our Cruise segment.
(a) Includes our Cruise segment.
$
36,060
$ 36,060
$
4,098
$ 4,098
$
2,403
$ 2,403
$
2,418
$ 2,418
$
1.68
$ 1.68
1.66
$
$ 1.66
$
35,473
$ 35,473
$
3,643
$ 3,643
$
2,311
$ 2,311
$
2,351
$ 2,351
$
1.62
$ 1.62
1.60
$
$ 1.60
$
30,826
$ 30,826
$
1,273
$ 1,273
(192)
$
$ (192)
(194)
$
$ (194)
(0.16)
$
$ (0.16)
(0.16)
$
$ (0.16)
In the three months ended March 31, 2019, June 30, 2019, September 30, 2019 and December 31, 2019 we recorded pre-tax
In the three months ended March 31, 2019, June 30, 2019, September 30, 2019 and December 31, 2019 we recorded pre-tax
charges of $790 million, $361 million, $390 million and $267 million related to transformation activities including accelerated
charges of $790 million, $361 million, $390 million and $267 million related to transformation activities including accelerated
depreciation, supplier-related charges and other charges. In the three months ended March 31, 2019, June 30, 2019 and September
depreciation, supplier-related charges and other charges. In the three months ended March 31, 2019, June 30, 2019 and September
30, 2019, we recorded pre-tax benefits of $857 million, $380 million and $123 million related to the retrospective recoveries of
30, 2019, we recorded pre-tax benefits of $857 million, $380 million and $123 million related to the retrospective recoveries of
indirect taxes in Brazil. In the three months ended September 30, 2019 and December 31, 2019, we estimate that the lost vehicle
indirect taxes in Brazil. In the three months ended September 30, 2019 and December 31, 2019, we estimate that the lost vehicle
production volumes and parts sales due to the UAW strike had an unfavorable pre-tax impact on our Income from continuing
production volumes and parts sales due to the UAW strike had an unfavorable pre-tax impact on our Income from continuing
operations. In the three months ended December 31, 2019 we recorded a pre-tax charge of $164 million related to the divestiture
operations. In the three months ended December 31, 2019 we recorded a pre-tax charge of $164 million related to the divestiture
in our joint venture FAW-GM.
in our joint venture FAW-GM.
1st Quarter
1st Quarter
2nd Quarter
211d Quarter
3rd Quarter
3rd Quarter
4th Quarter
4th Quarter
2018
2018
Total net sales and revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
36,099
Total net sales and revenue $ 36,099
Automotive and other gross margin(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
2,507
Automotive and other gross margin(a) $ 2,507
Income from continuing operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,110
Income from continuing operations $ 1,110
Loss from discontinued operations, net of tax. . . . . . . . . . . . . . . . . . . . . . . $
70
Loss from discontinued operations, net of tax $ 70
Net income attributable to stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,046
Net income attributable to stockholders $ 1,046
Basic earnings per common share – continuing operations . . . . . . . . . . . . $
0.78
Basic earnings per common share — continuing operations $ 0.78
Basic loss per common share – discontinued operations . . . . . . . . . . . . . . $
0.05
Basic loss per common share — discontinued operations $ 0.05
0.77
Diluted earnings per common share – continuing operations . . . . . . . . . . . $
Diluted earnings per common share — continuing operations $ 0.77
Diluted loss per common share – discontinued operations . . . . . . . . . . . . . $
0.05
Diluted loss per common share — discontinued operations $ 0.05
__________
(a) Includes our Cruise segment.
(a) Includes our Cruise segment.
$
36,760
$ 36,760
$
3,204
$ 3,204
$
2,366
$ 2,366
$
$
$
2,390
$ 2,390
$
1.68
$ 1.68
$
$
1.66
$
$ 1.66
$
$
$
35,791
$ 35,791
$
3,743
$ 3,743
$
2,530
$ 2,530
$
38,399
$ 38,399
$
2,935
$ 2,935
$
2,069
$ 2,069
—
— $
$
$
2,534
$ 2,534
$
1.77
$ 1.77
— $
$
$
1.75
$ 1.75
— $
$
— $
$
$
2,044
$ 2,044
$
1.42
$ 1.42
— $
—
$
1.40
$
$ 1.40
— $
—
$
In the three months ended March 31, 2018 and June 30, 2018, we collectively recorded pre-tax charges of $1.1 billion related
In the three months ended March 31, 2018 and June 30, 2018, we collectively recorded pre-tax charges of $1.1 billion related
to the closure of a facility and other restructuring actions in Korea. In the three months ended September 30, 2018 we recorded
to the closure of a facility and other restructuring actions in Korea. In the three months ended September 30, 2018 we recorded
pre-tax charges of $440 million for ignition switch related legal matters. In the three months ended December 31, 2018 we recorded
pre-tax charges of $440 million for ignition switch related legal matters. In the three months ended December 31, 2018 we recorded
pre-tax charges of $1.3 billion related to transformation activities including employee separation, accelerated depreciation and
pre-tax charges of $1.3 billion related to transformation activities including employee separation, accelerated depreciation and
other charges; and a non-recurring tax benefit of $1.0 billion related to foreign earnings.
other charges; and a non-recurring tax benefit of $1.0 billion related to foreign earnings.
Note 25. Segment Reporting
Note 25. Segment Reporting
We analyze the results of our business through the following reportable segments: GMNA, GMI, Cruise and GM Financial. As
We analyze the results of our business through the following reportable segments: GMNA, GMI, Cruise and GM Financial. As
discussed in Note 1, the European Business is presented as discontinued operations and is excluded from our segment results for
discussed in Note 1, the European Business is presented as discontinued operations and is excluded from our segment results for
all periods presented. The European Business was previously reported as our GM Europe segment and part of GM Financial. The
all periods presented. The European Business was previously reported as our GM Europe segment and part of GM Financial. The
chief operating decision maker evaluates the operating results and performance of our automotive segments and Cruise through
chief operating decision maker evaluates the operating results and performance of our automotive segments and Cruise through
EBIT-adjusted, which is presented net of noncontrolling interests. The chief operating decision maker evaluates GM Financial
EBIT-adjusted, which is presented net of noncontrolling interests. The chief operating decision maker evaluates GM Financial
through EBT-adjusted because interest income and interest expense are part of operating results when assessing and measuring
through EBT-adjusted because interest income and interest expense are part of operating results when assessing and measuring
91
91
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
the operational and financial performance of the segment. Each segment has a manager responsible for executing our strategic
the operational and financial performance of the segment. Each segment has a manager responsible for executing our strategic
initiatives. While not all vehicles within a segment are individually profitable on a fully allocated cost basis, those vehicles attract
initiatives. While not all vehicles within a segment are individually profitable on a fully allocated cost basis, those vehicles attract
customers to dealer showrooms and help maintain sales volumes for other, more profitable vehicles and contribute towards meeting
customers to dealer showrooms and help maintain sales volumes for other, more profitable vehicles and contribute towards meeting
required fuel efficiency standards. As a result of these and other factors, we do not manage our business on an individual brand
required fuel efficiency standards. As a result of these and other factors, we do not manage our business on an individual brand
or vehicle basis.
or vehicle basis.
Substantially all of the trucks, crossovers, cars and automobile parts produced are marketed through retail dealers in North
Substantially all of the trucks, crossovers, cars and automobile parts produced are marketed through retail dealers in North
America and through distributors and dealers outside of North America, the substantial majority of which are independently owned.
America and through distributors and dealers outside of North America, the substantial majority of which are independently owned.
In addition to the products sold to dealers for consumer retail sales, trucks, crossovers and cars are also sold to fleet customers,
In addition to the products sold to dealers for consumer retail sales, trucks, crossovers and cars are also sold to fleet customers,
including daily rental car companies, commercial fleet customers, leasing companies and governments. Fleet sales are completed
including daily rental car companies, commercial fleet customers, leasing companies and governments. Fleet sales are completed
through the dealer network and in some cases directly with fleet customers. Retail and fleet customers can obtain a wide range of
through the dealer network and in some cases directly with fleet customers. Retail and fleet customers can obtain a wide range of
after-sale vehicle services and products through the dealer network, such as maintenance, light repairs, collision repairs, vehicle
after-sale vehicle services and products through the dealer network, such as maintenance, light repairs, collision repairs, vehicle
accessories and extended service warranties.
accessories and extended service warranties.
GMNA meets the demands of customers in North America with vehicles developed, manufactured and/or marketed under the
GMNA meets the demands of customers in North America with vehicles developed, manufactured and/or marketed under the
Buick, Cadillac, Chevrolet and GMC brands. GMI primarily meets the demands of customers outside North America with vehicles
Buick, Cadillac, Chevrolet and GMC brands. GMI primarily meets the demands of customers outside North America with vehicles
developed, manufactured and/or marketed under the Buick, Cadillac, Chevrolet, GMC, and Holden brands. We also have equity
developed, manufactured and/or marketed under the Buick, Cadillac, Chevrolet, GMC, and Holden brands. We also have equity
ownership stakes in entities that meet the demands of customers in other countries, primarily China, with vehicles developed,
ownership stakes in entities that meet the demands of customers in other countries, primarily China, with vehicles developed,
manufactured and/or marketed under the Baojun, Buick, Cadillac, Chevrolet and Wuling brands. Cruise, formerly GM Cruise, is
manufactured and/or marketed under the Baojun, Buick, Cadillac, Chevrolet and Wuling brands. Cruise, formerly GM Cruise, is
our global segment responsible for the development and commercialization of autonomous vehicle technology, and includes
our global segment responsible for the development and commercialization of autonomous vehicle technology, and includes
autonomous vehicle-related engineering and other costs.
autonomous vehicle-related engineering and other costs.
Our automotive interest income and interest expense, Maven, legacy costs from the Opel/Vauxhall Business (primarily pension
Our automotive interest income and interest expense, Maven, legacy costs from the OpelNauxhall Business (primarily pension
costs), corporate expenditures and certain nonsegment specific revenues and expenses are recorded centrally in Corporate. Corporate
costs), corporate expenditures and certain nonsegment specific revenues and expenses are recorded centrally in Corporate. Corporate
assets primarily consist of cash and cash equivalents, marketable debt securities, our investment in Lyft, PSA warrants, Maven
assets primarily consist of cash and cash equivalents, marketable debt securities, our investment in Lyft, PSA warrants, Maven
vehicles and intercompany balances. Retained net underfunded pension liabilities related to the European Business are also recorded
vehicles and intercompany balances. Retained net underfunded pension liabilities related to the European Business are also recorded
in Corporate. All intersegment balances and transactions have been eliminated in consolidation.
in Corporate. All intersegment balances and transactions have been eliminated in consolidation.
The following tables summarize key financial information by segment:
The following tables summarize key financial information by segment:
GMNA
GMNA
GMI
GMI
Corporate
Corporate
Eliminations
Eliminations
Total
Total
Automotive
Automotive
Cruise
Cruise
GM
GM
Financial
Financial
Eliminations/
Eliminations!
Reclassifications
Reclassifications
Total
Total
At and For the Year Ended December 31, 2019
At and For the Year Ended December 31, 2019
Net sales and revenue . . . . . . . . . . . . . $ 106,366
Net sales and revenue $ 106,366
$ 16,111
$ 16,111
$
220
$ 220
$
122,697
$ 122,697
$
100
$ 100
$
14,554
$ 14,554
Earnings (loss) before interest and
Earnings (loss) before interest and
taxes-adjusted . . . . . . . . . . . . . . . . $
8,204
taxes-adjusted $ 8,204
Adjustments(a) . . . . . . . . . . . . . . . . . . $
(1,618)
Adjustments(a) $ (1,618)
$
(202)
$ (202)
$
(691)
$ (691)
$
1,081
$ 1,081
$
(2)
$ (2)
$
7,311
$ 7,311
(1,004)
$
$ (1,004)
$
2,104
$ 2,104
(539)
$
$ (539)
$
$ -
— $
$ -
— $
$
$
$
$
$
(114)
(114)
$
137,237
$ 137,237
(18)
(18)
$
8,393
$ 8,393
Automotive interest income . . . . . . . .
Automotive interest income
Automotive interest expense . . . . . . .
Automotive interest expense
Net (loss) attributable to
Net (loss) attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Income before income taxes. . . . . . . .
Income before income taxes
Income tax expense . . . . . . . . . . . . . .
Income tax expense
Income from continuing operations .
Income from continuing operations . .
Loss from discontinued operations,
Loss from discontinued operations,
net of tax
net of tax . . . . . . . . . . . . . . . . . . . .
Net loss attributable to
Net loss attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Net income attributable to
Net income attributable to
stockholders. . . . . . . . . . . . . . . . . .
stockholders
Equity in net assets of
Equity in net assets of
nonconsolidated affiliates . . . . . . . $
84
nonconsolidated affiliates $ 84
Goodwill and intangibles . . . . . . . . . . $
2,459
Goodwill and intangibles $ 2,459
$
7,023
$ 7,023
$
$
— $
$
— $
7,107
$ 7,107
$
$
— $
1,455
$ 1,455
$
888
$ 888
$
1
$ 1
$
$ -
— $
3,348
$ 3,348
$
634
$ 634
$
1,355
$ 1,355
Total assets . . . . . . . . . . . . . . . . . . . . . $ 109,290
Total assets $ 109,290
$ 24,969
$ 24,969
$
32,365
$ 32,365
(50,244)
$
$ (50,244)
$
116,380
$ 116,380
$
4,230
$ 4,230
$ 108,881
$ 108,881
Expenditures for property. . . . . . . . . . $
6,305
Expenditures for property $ 6,305
$
1,096
$ 1,096
$
84
$ 84
$
$
— $
7,485
$ 7,485
$
60
$ 60
$
47
$ 47
Depreciation and amortization . . . . . . $
6,112
Depreciation and amortization $ 6,112
$
533
$ 533
$
46
$ 46
$ (2)
(2)
$
$
6,689
$ 6,689
$
21
$ 21
$
7,350
$ 7,350
$
$
$
$
$
$
$
$
$
$
Impairment charges . . . . . . . . . . . . . . $
15
Impairment charges $ 15
$
7
$ 7
$
$
— $
$
— $
22
$ 22
$
36
$ 36
$
$
— $
$
Equity income. . . . . . . . . . . . . . . . . . . $
8
Equity income $ 8
$
1,123
$ 1,123
$
(29)
$ (29)
$
$
— $
1,102
$ 1,102
$
$
— $
166
$ 166
$
$
—
(539)
(539)
429
429
(782)
(782)
(65)
(65)
7,436
7,436
(769)
(769)
6,667
6,667
—
65
65
$
6,732
$ 6,732
— $
8,562
$ 8,562
— $
5,337
$ 5,337
(1,454)
(1,454)
$
228,037
$ 228,037
— $
$ 7,592
7,592
— $
14,060
$ 14,060
— $
58
$ 58
— $
1,268
$ 1,268
__________
(a) Consists of restructuring and other charges related to transformation activities of $1.6 billion in GMNA and $115 million in GMI; a benefit of $1.4 billion related to the retrospective
(a) Consists of restructuring and other charges related to transformation activities of $1.6 billion in GMNA and $115 million in GMI; a benefit of $1.4 billion related to the retrospective
recoveries of indirect taxes in Brazil; partially offset by losses of $164 million related to the FAW-GM divestiture in GMI.
recoveries of indirect taxes in Brazil; partially offset by losses of $164 million related to the FAW-GM divestiture in GMI.
92
92
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
At and For the Year Ended December 31, 2018
At and For the Year Ended December 31, 2018
$ 113,792
Net sales and revenue
Net sales and revenue . . . . . . . . . . . . . $ 113,792
$ 19,148
$ 19,148
$ 203
$
203
GMNA
GMNA
GMI
GMI
Corporate
Co rp o rate
Eliminations
Eliminations
Total
Total
Automotive
Automotive
$ 133,143
$
133,143
Cruise
Cruise
GM
GM
Financial
Financial
$ -
$
— $
$ 14,016
14,016
Earnings (loss) before interest and
Eamings (loss) before interest and
taxes-adjusted . . . . . . . . . . . . . . . . $
taxes-adjusted
Adjustments(a) . . . . . . . . . . . . . . . . . . $
Adjustments(a)
10,769
$ 10,769
(1,236)
$ (1,236)
$
423
$ 423
$
(570)
$ (570)
$ (1,212)
$ (1,212)
$
(457)
$ (457)
$
10,622
$ 10,622
(728)
$
$ (728)
$
1,893
$ 1,893
(2,905)
$
$ (2,905)
$ -
$
— $
$ -
— $
$
Automotive interest income . . . . . . . .
Automotive interest income
Automotive interest expense . . . . . . .
Automotive interest expense
Net (loss) attributable to
Net (loss) attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Income before income taxes
Income before income taxes. . . . . . . .
Income tax expense . . . . . . . . . . . . . .
Income tax expense
Income from continuing operations . .
Income from continuing operations .
Loss from discontinued operations,
Loss from discontinued operations,
net of tax . . . . . . . . . . . . . . . . . . . .
net of tax
Net loss attributable to
Net loss attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Net income attributable to
Net income attributable to
stockholders. . . . . . . . . . . . . . . . . .
stockholders
Equity in net assets of
Equity in net assets of
nonconsolidated affiliates . . . . . . . $
75
nonconsolidated affiliates $ 75
Goodwill and intangibles . . . . . . . . . . $
2,623
Goodwill and intangibles $ 2,623
$
7,761
$ 7,761
$
24
$ 24
$
$
— $
7,860
$ 7,860
$
$
— $
1,355
$ 1,355
$
928
$ 928
$
1
$ 1
$
$ -
— $
3,552
$ 3,552
$
671
$ 671
$
1,356
$ 1,356
Total assets . . . . . . . . . . . . . . . . . . . . . $ 109,763
Total assets $ 109,763
$ 24,911
$ 24,911
$
31,694
$ 31,694
(50,690)
$
$ (50,690)
$
115,678
$ 115,678
$
3,195
$ 3,195
$ 109,953
$ 109,953
Expenditures for property. . . . . . . . . . $
7,784
Expenditures for property $ 7,784
$
883
$ 883
$
21
$ 21
(2)
$
$ (2)
$
8,686
$ 8,686
$
15
$ 15
$
60
$ 60
Depreciation and amortization . . . . . . $
4,995
Depreciation and amortization $ 4,995
$
562
$ 562
$
50
$ 50
(3)
$
$ (3)
$
5,604
$ 5,604
$ 7
$
7
$ 7,531
$
7,531
$
$
$
$
$
$
$
$
$
$
Impairment charges . . . . . . . . . . . . . . $
55
Impairment charges $ 55
$
466
$ 466
$
6
$ 6
$
$
— $
527
$ 527
Equity income. . . . . . . . . . . . . . . . . . . $
8
Equity income $ 8
$
1,972
$ 1,972
$
$
— $
$
— $
1,980
$ 1,980
$
$
$
$
$
— $
$
— $
— $
183
$ 183
$
$
$
$
$
$
Eliminations
Eliininations
Total
Total
(110)
(110)
S 147,049
$
147,049
(4)
(4)
$
11,783
$ 11,783
—
(2,905)
(2,905)
335
335
(655)
(655)
(9)
(9)
8,549
8,549
(474)
(474)
8,075
8,075
(70)
(70)
9
9
$ 8,014
$
8,014
— $
$ 9,215
9,215
— $
5,579
$ 5,579
(1,487)
(1,487)
$
227,339
$ 227,339
— $
8,761
$ 8,761
— $
13,142
$ 13,142
— $
527
$ 527
— $
2,163
$ 2,163
__________
(a) Consists of restructuring and other charges related to transformation activities of $1.2 billion in GMNA; charges of $1.2 billion related to restructuring actions in Korea and other
(a) Consista of restructuring and other charges related to transformation activities of $1.2 billion in GMNA; charges of $1.2 billion related to restructuring actions in Korea and other
countries in GMI; and of $440 million for ignition switch-related legal matters and other insignificant charges in Corporate.
countries in GMI; and of $440 million for ignition switch-related legal matters and other insignificant charges in Corporate.
At and For the Year Ended December 31, 2017
At aud For the Year Ended December 31, 2017
Net sales and revenue . . . . . . . . . . . . . $ 111,345
Net sales and revenue $ 111,345
$ 21,920
$ 21,920
$
342
$ 342
GMNA
GMNA
GMI
GMI
Corporate
Corporate
Eliminations
E Molina lions
Total
Total
Automotive
Automotive
$
133,607
$ 133,607
Cruise
Cruise
GM
GM
Financial
Financial
$
$ -
— $
12,151
$ 12,151
Earnings (loss) before interest and
Eamings (loss) before interest and
taxes-adjusted . . . . . . . . . . . . . . . . $
11,889
taxes-adjusted $ 11,889
Adjustments(a) . . . . . . . . . . . . . . . . . . $
Adjustments(a) $ -
$
1,300
$ 1,300
$
(921)
$ (921)
$
12,268
$ 12,268
(613)
$
$ (613)
$
1,196
$ 1,196
— $
(540)
$ (540)
$
(114)
$ (114)
(654)
$
$ (654)
$ -
$
— $
$ -
$
— $
Automotive interest income
Automotive interest income . . . . . . . .
Automotive interest expense . . . . . . .
Automotive interest expense
Net (loss) attributable to
Net (loss) attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Income before income taxes. . . . . . . .
Income before income taxes
Income tax expense . . . . . . . . . . . . . .
Income tax expense
Income from continuing operations . .
Income from continuing operations .
Loss from discontinued operations,
Loss from discontinued operations,
net of tax . . . . . . . . . . . . . . . . . . . .
net of tax
Net loss attributable to
Net loss attributable to
noncontrolling interests . . . . . . . . .
noncontrolling interests
Net loss attributable to stockholders.
Net loss attributable to stockholders. .
Equity in net assets of
Equity in net assets of
nonconsolidated affiliates . . . . . . . $
68
nonconsolidated affiliates $ 68
Goodwill and intangibles . . . . . . . . . . $
2,819
Goodwill and intangibles $ 2.819
$
7,818
$ 7,818
$
$
— $
$
— $
7,886
$ 7,886
$
$
— $
1,187
$ 1,187
$
973
$ 973
$
11
$ 11
$
$ -
— $
3,803
$ 3,803
$
679
$ 679
$
1,367
$ 1,367
Total assets . . . . . . . . . . . . . . . . . . . . . $
99,874
Total assets $ 99.874
$ 27,712
$ 27,712
$
30,573
$ 30,573
(42,750)
$
$ (42,750)
$
115,409
$ 115,409
$
666
$ 666
$
97,251
$ 97,251
Expenditures for property. . . . . . . . . . $
7,704
Expenditures for property $ 7.704
$
607
$ 607
$
14
$ 14
$
$
— $
8,325
$ 8,325
$
34
$ 34
$
94
$ 94
Depreciation and amortization . . . . . . $
4,654
Depreciation and amortization $ 4.654
$
708
$ 708
$
32
$ 32
(1)
$
$ (1)
$
5,393
$ 5,393
$
1
$ 1
$
6,573
$ 6,573
$
$
$
$
$
$
$
$
$
$
Impairment charges . . . . . . . . . . . . . . $
78
Impairment charges $ 78
$
211
$ 211
$
5
$ 5
$
$
— $
294
$ 294
Equity income. . . . . . . . . . . . . . . . . . . $
8
Equity income $ 8
$
1,951
$ 1,951
$
$
— $
$
— $
1,959
$ 1,959
$
$
$
$
— $
$
— $
$
— $
173
$ 173
$
$
Eliminations
Eliminations
Total
Total
$
$
$
$
(170)
(170)
$
145,588
$ 145,588
(7)
(7)
$
12,844
$ 12,844
—
(654)
(654)
266
266
(575)
(575)
(18)
(18)
11,863
11,863
(11,533)
(11,533)
330
330
(4,212)
(4,212)
18
18
(3,864)
$ (3,864)
$
— $
$ 9,073
9,073
— $
5,849
$ 5,849
(844)
(844)
$
212,482
$ 212,482
— $
8,453
$ 8,453
— $
11,967
$ 11,967
— $
294
$ 294
— $
2,132
$ 2,132
__________
(a) Consists of charges of $460 million related to restructuring actions in India and South Africa in GMI; charges of $80 million associated with the deconsolidation of Venezuela in
(a) Consists of charges of $460 million related to restructuring actions in India and South Africa in GMI; charges of $80 million associated with the deconsolidation of Venezuela in
GMI and charges of $114 million for ignition switch-related legal matters in Corporate.
GMI and charges of $114 million for ignition switch-related legal matters in Corporate.
93
93
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Automotive revenue is attributed to geographic areas based on the country of sale. GM Financial revenue is attributed to the
Automotive revenue is attributed to geographic areas based on the country of sale. GM Financial revenue is attributed to the
geographic area where the financing is originated. The following table summarizes information concerning principal geographic
geographic area where the fmancing is originated. The following table summarizes information concerning principal geographic
areas:
areas:
2019
2019
At and For the Years Ended December 31,
At and For the Years Ended December 31,
2018
2018
2017
2017
Net Sales and
Net Sales and
Revenue
Revenue
Long-Lived
Long-Lived
Assets
Assets
Net Sales and
Net Sales and
Revenue
Revenue
Long-Lived
Long-Lived
Assets
Assets
Net Sales and
Net Sales and
Revenue
Revenue
Long-Lived
Long-Lived
Assets
Assets
Automotive
Automotive
U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . $
97,887
U.S. $ 97,887
Non-U.S. . . . . . . . . . . . . . . . . . . . . . .
24,810
Non-U.S. 24,810
$
25,401
$ 25,401
13,190
13,190
$
104,413
$ 104,413
28,632
28,632
$
25,625
$ 25,625
13,263
13,263
$
100,674
$ 100.674
32,775
32,775
$
24,473
S 24,473
12,715
12,715
GM Financial
GM Financial
U.S. . . . . . . . . . . . . . . . . . . . . . . . . . .
12,727
US.12,727
Non-U.S. . . . . . . . . . . . . . . . . . . . . . .
1,813
Non-U.S. 1,813
Total consolidated. . . . . . . . . . . . . . . . . $
137,237
Total consolidated $ 137,237
39,509
39,509
2,772
2,772
$
80,872
$ 80,872
12,169
12,169
1,835
1,835
$
147,049
$ 147,049
41,334
41,334
2,476
2,476
$
82,698
$ 82,698
10,489
10,489
1,650
1,650
$
145,588
$ 145,588
40,674
40,674
2,467
2,467
$
80,329
$ 80,329
No individual country other than the U.S. represented more than 10% of our total net sales and revenue or long-lived assets.
No individual country other than the U.S. represented more than 10% of our total net sales and revenue or long-lived assets.
Note 26. Supplemental Information for the Consolidated Statements of Cash Flows
Note 26. Supplemental Information for the Consolidated Statements of Cash Flows
The following table summarizes the sources (uses) of cash provided by Change in other operating assets and liabilities and Cash
The following table summarizes the sources (uses) of cash provided by Change in other operating, assets and liabilities and Cash
paid for income taxes and interest:
paid for income taxes and interest:
Years Ended December 31,
Years Ended December 31,
2019
2019
Change in other operating assets and liabilities
Change in other operating assets and liabilities
(563) $
$
Accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
1,402
492
$ 1,402
Accounts receivable $ (563) $ 492
(2,099)
(2,606)
Wholesale receivables funded by GM Financial, net . . . . . . . . . . . . . . . . . . .
663
(2,099)
(2,606)
Wholesale receivables funded by GM Financial, net 663
(761)
440
399
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
440
399
Inventories (761)
(263)
748
Automotive equipment on operating leases . . . . . . . . . . . . . . . . . . . . . . . . . .
274
(263)
748
Automotive equipment on operating leases 274
(529)
(1,550)
108
Change in other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
108
(529)
Change in other assets (1,550)
(362)
(537)
(492)
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(362)
(537)
Accounts payable (492)
(3)
(75)
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
213
(75)
Income taxes payable 213
(3)
(2,238)
(1,573)
732
Accrued and other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2,238)
732
Accrued and other liabilities (1,573)
(3,015)
(1,376) $
(3,789) $
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Total $ (3,789) $ (1,376) $ (3,015)
2018
2018
2017
2017
Cash paid for income taxes and interest
Cash paid for income taxes and interest
Cash paid for income taxes, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
689
Cash paid for income taxes, net $ 689
739
Cash paid for interest (net of amounts capitalized) – Automotive . . . . . . . . . $
Cash paid for interest (net of amounts capitalized) - Automotive $ 739
3,475
Cash paid for interest (net of amounts capitalized) – GM Financial. . . . . . . .
3,475
Cash paid for interest (net of amounts capitalized) - GM Financial
Total cash paid for interest (net of amounts capitalized). . . . . . . . . . . . . . . . . $
4,214
Total cash paid for interest (net of amounts capitalized) 4,214
$
660
$ 660
656
$
$ 656
2,941
2,941
$
3,597
$ 3,597
$
656
$ 656
$
501
$ 501
2,571
2,571
$
3,072
$ 3,072
* * * * * * *
94
94
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None
None
Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
"
* * * * * * *
Disclosure Controls and Procedures We maintain disclosure controls and procedures designed to provide reasonable assurance
Disclosure Controls and Procedures We maintain disclosure controls and procedures designed to provide reasonable assurance
that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported
that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported
within the specified time periods and accumulated and communicated to our management, including our principal executive officer
within the specified time periods and accumulated and communicated to our management, including our principal executive officer
and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and
Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and
procedures (as defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Exchange Act) at December 31, 2019. Based on
procedures (as defmed in Rules 13a-15(e) or 15d-15(e) promulgated under the Exchange Act) at December 31, 2019. Based on
this evaluation required by paragraph (b) of Rules 13a-15 or 15d-15, our CEO and CFO concluded that our disclosure controls
this evaluation required by paragraph (b) of Rules 13a-15 or 15d-15, our CEO and CFO concluded that our disclosure controls
and procedures were effective as of December 31, 2019.
and procedures were effective as of December 31, 2019.
Management's Report on Internal Control over Financial Reporting Our management is responsible for establishing and
Management's Report on Internal Control over Financial Reporting Our management is responsible for establishing and
maintaining effective internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
maintaining effective internal control over financial reporting as defmed in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act. This system is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation
Act. This system is designed to provide reasonable assurance regarding the reliability of fmancial reporting and the preparation
of consolidated financial statements for external purposes in accordance with U.S. GAAP. Because of the inherent limitations of
of consolidated fmancial statements for external purposes in accordance with U.S. GAAP. Because of the inherent limitations of
internal control over financial reporting, including the possibility of collusion or improper management override of controls,
internal control over fmancial reporting, including the possibility of collusion or improper management override of controls,
misstatements due to error or fraud may not be prevented or detected on a timely basis.
misstatements due to error or fraud may not be prevented or detected on a timely basis.
Our management performed an assessment of the effectiveness of our internal control over financial reporting at December 31,
Our management performed an assessment of the effectiveness of our internal control over financial reporting at December 31,
2019, utilizing the criteria discussed in the “Internal Control – Integrated Framework (2013)” issued by the Committee of Sponsoring
2019, utilizing the criteria discussed in the "Internal Control —Integrated Framework (2013)" issued by the Committee of Sponsoring
Organizations of the Treadway Commission. The objective of this assessment was to determine whether our internal control over
Organizations of the Treadway Commission. The objective of this assessment was to determine whether our internal control over
financial reporting was effective at December 31, 2019. Based on management's assessment, we have concluded that our internal
financial reporting was effective at December 31, 2019. Based on management's assessment, we have concluded that our internal
control over financial reporting was effective at December 31, 2019.
control over fmancial reporting was effective at December 31, 2019.
The effectiveness of our internal control over financial reporting has been audited by Ernst & Young LLP, an independent
The effectiveness of our internal control over fmancial reporting has been audited by Ernst & Young, LLP, an independent
registered public accounting firm, as stated in its report included herein.
registered public accounting firm, as stated in its report included herein.
Changes in Internal Control over Financial Reporting There have not been any changes in our internal control over financial
Changes in Internal Control over Financial Reporting There have not been any changes in our internal control over fmancial
reporting during the three months ended December 31, 2019 that have materially affected, or are reasonably likely to materially
reporting during the three months ended December 31, 2019 that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting. In 2019, we initiated actions to enhance our close, consolidation, planning and
affect, our internal control over fmancial reporting. In 2019, we initiated actions to enhance our close, consolidation, planning and
reporting processes through the implementation of a suite of new systems and system architectures. On January 1, 2019, we updated
reporting processes through the implementation of a suite of new systems and system architectures. On January 1,2019, we updated
our forecast and planning processes, inclusive of our year-over-year operating result changes discussed in the MD&A. On May 1
our forecast and planning processes, inclusive of our year-over-year operating result changes discussed in the MD&A. On May 1
2019, we updated our close, consolidation, and financial reporting systems, processes and related internal controls. For additional
2019, we updated our close, consolidation, and financial reporting systems, processes and related internal controls. For additional
information refer to Item 1A. Risk Factors.
information refer to Item 1A. Risk Factors.
/s/ MARY T. BARRA
/s/ MARY T. BARRA
Mary T. Barra
Mary T. Barra
Chairman and Chief Executive Officer
Chairman and Chief Executive Officer
February 5, 2020
February 5, 2020
/s/ DHIVYA SURYADEVARA
/s/ DHIVYA SURYADEVARA
Dhivya Suryadevara
Dhivya Suryadevara
Executive Vice President and Chief Financial Officer
Executive Vice President and Chief Financial Officer
February 5, 2020
February 5,2020
* * * * * * *
95
95
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Item 9B. Other Information
Item 9B. Other Information
None
None
Items 10, 11, 12, 13 and 14
Items 10, 11, 12, 13 and 14
* * * * * * *
PART III
PART III
Information required by Items 10, 11, 12, 13 and 14 of this Form 10-K is incorporated by reference from our definitive Proxy
Information required by Items 10, 11, 12, 13 and 14 of this Form 10-K is incorporated by reference from our defmitive Proxy
Statement for our 2020 Annual Meeting of Stockholders, which will be filed with the SEC, pursuant to Regulation 14A, not later
Statement for our 2020 Annual Meeting of Stockholders, which will be filed with the SEC, pursuant to Regulation 14A, not later
than 120 days after the end of the 2019 fiscal year, all of which information is hereby incorporated by reference in, and made part
than 120 days after the end of the 2019 fiscal year, all of which information is hereby incorporated by reference in, and made part
of, this Form 10-K, except disclosure of our executive officers, which is included in Item 1 of this report.
of, this Form 10-K, except disclosure of our executive officers, which is included in Item 1 of this report.
* * * * * * *
PART IV
PART IV
ITEM 15. Exhibits
ITEM 15. Exhibits
(a) 1. All Financial Statements and Supplemental Information
(a) 1. All Financial Statements and Supplemental Information
2. Financial Statement Schedules
2. Financial Statement Schedules
All financial statement schedules are omitted as the required information is inapplicable or the information is presented
All financial statement schedules are omitted as the required information is inapplicable or the information is presented
in the consolidated financial statements and notes thereto in Item 8.
in the consolidated fmancial statements and notes thereto in Item 8.
3. Exhibits
3. Exhibits
(b) Exhibits
(b) Exhibits
Exhibit
Exhibit
Exhibit Name
Exhibit Name
Number
Number
Master Agreement, dated as of March 5, 2017, between General Motors Holdings, LLC and Peugeot S.A.,
2.1
2.1 Master Agreement, dated as of March 5, 2017, between General Motors Holdings, LLC and Peugeot S.A.,
incorporated herein by reference to Exhibit 2.1 to the Quarterly Report on Form 10-Q of General Motors
incorporated herein by reference to Exhibit 2.1 to the Quarterly Report on Form 10-Q of General Motors
Company filed April 28, 2017
Company filed April 28, 2017
Purchase Agreement by and among General Motors Holdings LLC, GM Cruise Holdings LLC, and Softbank
2.2
2.2 Purchase Agreement by and among General Motors Holdings LLC, GM Cruise Holdings LLC, and Softbank
Vision Fund (AIV M1), L.P. dated May 31, 2018, incorporated herein by reference to Exhibit 2.1 to the
Vision Fund (AIV M1), L.P. dated May 31, 2018, incorporated herein by reference to Exhibit 2.1 to the
Quarterly Report on Form 10-Q of General Motors Company filed July 25, 2018
Quarterly Report on Form 10-Q of General Motors Company filed July 25, 2018
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Purchase Agreement by and between GM Cruise Holdings LLC and Honda Motor Co., LTD., dated October
2.3
2.3 Purchase Agreement by and between GM Cruise Holdings LLC and Honda Motor Co., LTD., dated October
3, 2018, incorporated herein by reference to Exhibit 2.3 to the Annual Report on Form 10-K of General Motors
3,2018, incorporated herein by reference to Exhibit 2.3 to the Annual Report on Form 10-K of General Motors
Company filed February 6, 2019
Company filed February 6,2019
Incorporated by
Incorporated by
Reference
Reference
Restated Certificate of Incorporation of General Motors Company dated December 7, 2010, incorporated
3.1
3.1 Restated Certificate of Incorporation of General Motors Company dated December 7, 2010, incorporated
herein by reference to Exhibit 3.2 to the Current Report on Form 8-K of General Motors Company filed
herein by reference to Exhibit 3.2 to the Current Report on Form 8-K of General Motors Company filed
December 13, 2010
December 13, 2010
Incorporated by
Incorporated by
Reference
Reference
General Motors Company Amended and Restated Bylaws, as amended August 14, 2018, incorporated by
3.2
3.2 General Motors Company Amended and Restated Bylaws, as amended August 14, 2018, incorporated by
reference to Exhibit 3.1 to the Current Report on Form 8-K of General Motors Company filed August 20,
reference to Exhibit 3.1 to the Current Report on Form 8-K of General Motors Company filed August 20,
2018
2018
Incorporated by
Incorporated by
Reference
Reference
4.1
Description of Securities
4.1 Description of Securities
Indenture dated as of September 27, 2013, between General Motors Company and the Bank of New York
4.2
4.2 Indenture dated as of September 27, 2013, between General Motors Company and the Bank of New York
Mellon, as Trustee, incorporated herein by reference to Exhibit 4.2 to the Registration Statement on Form S-3
Mellon, as Trustee, incorporated herein by reference to Exhibit 4.2 to the Registration Statement on Form S-3
of General Motors Company filed April 30, 2014
of General Motors Company filed April 30, 2014
4.3
First Supplemental Indenture dated as of September 27, 2013 to the Indenture dated as of September 27, 2013
4.3 First Supplemental Indenture dated as of September 27, 2013 to the Indenture dated as of September 27,2013
between General Motors Company and the Bank of New York Mellon, as Trustee, incorporated herein by
between General Motors Company and the Bank of New York Mellon, as Trustee, incorporated herein by
reference to Exhibit 4.3 to the Registration Statement on Form S-4 of General Motors Company filed May
reference to Exhibit 4.3 to the Registration Statement on Form S-4 of General Motors Company filed May
22, 2014
22, 2014
Filed Herewith
Filed Herewith
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Second Supplemental Indenture dated as of November 12, 2014 to the Indenture dated as of September 27,
4.4
4.4 Second Supplemental Indenture dated as of November 12, 2014 to the Indenture dated as of September 27,
2013 between General Motors Company and the Bank of New York Mellon, as Trustee, incorporated herein
2013 between General Motors Company and the Bank of New York Mellon, as Trustee, incorporated herein
by reference to Exhibit 4.4 to the Current Report on Form 8-K of General Motors Company filed November
by reference to Exhibit 4.4 to the Current Report on Form 8-K of General Motors Company filed November
12, 2014
12, 2014
Incorporated by
Incorporated by
Reference
Reference
Third Supplemental Indenture, dated as of February 23, 2016, to the Indenture, dated as of September 27,
4.5
4.5 Third Supplemental Indenture, dated as of February 23, 2016, to the Indenture, dated as of September 27,
2013, between General Motors Company, as issuer, and The Bank of New York Mellon, as Trustee, incorporated
2013, between General Motors Company, as issuer, and The Bank ofNew York Mellon, as Trustee, incorporated
herein by reference to Exhibit 4.1 to the Current Report on Form 8-K of General Motors Company filed
herein by reference to Exhibit 4.1 to the Current Report on Form 8-K of General Motors Company filed
February 23, 2016
February 23, 2016
Incorporated by
Incorporated by
Reference
Reference
96
96
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit
Exhibit
Exhibit Name
Exhibit Name
Number
Number
Fourth Supplemental Indenture, dated as of August 7, 2017, to the Indenture, dated as of September 27, 2013,
4.6
4.6 Fourth Supplemental Indenture, dated as of August 7,2017, to the Indenture, dated as of September 27,2013,
between General Motors Company, as issuer, and The Bank of New York Mellon, as Trustee, incorporated
between General Motors Company, as issuer, and The Bank of New York Mellon, as Trustee, incorporated
herein by reference to Exhibit 4.1 to the Current Report on Form 8-K of General Motors Company filed August
herein by reference to Exhibit 4.1 to the Current Report on Form 8-K of General Motors Company filed August
8, 2017
8, 2017
Fifth Supplemental Indenture, dated as of September 10, 2018, to the Indenture, dated as of September 27,
4.7
4.7 Fifth Supplemental Indenture, dated as of September 10, 2018, to the Indenture, dated as of September 27,
2013, between General Motors Company, as issuer, and The Bank of New York Mellon, as Trustee, incorporated
2013, between General Motors Company, as issuer, and The Bank ofNew York Mellon, as Trustee, incorporated
by reference to Exhibit 4.2 to the Current Report on Form 8-K of General Motors Company filed September
by reference to Exhibit 4.2 to the Current Report on Form 8-K of General Motors Company filed September
10, 2018
10, 2018
4.8
Calculation Agency Agreement, dated as of August 7, 2017 between General Motors Company and the Bank
4.8 Calculation Agency Agreement, dated as of August 7, 2017 between General Motors Company and the Bank
of New York Mellon, as calculation agent, incorporated herein by reference to Exhibit 4.2 to the Current
of New York Mellon, as calculation agent, incorporated herein by reference to Exhibit 4.2 to the Current
Report on Form 8-K of General Motors Company filed August 8, 2017
Report on Form 8-K of General Motors Company filed August 8, 2017
Calculation Agency Agreement, dated as of September 10, 2018 between General Motors Company and the
4.9
4.9 Calculation Agency Agreement, dated as of September 10, 2018 between General Motors Company and the
Bank of New York Mellon, as calculation agent, incorporated herein by reference to Exhibit 4.3 to the Current
Bank of New York Mellon, as calculation agent, incorporated herein by reference to Exhibit 4.3 to the Current
Report on Form 8-K of General Motors Company filed September 10, 2018
Report on Form 8-K of General Motors Company filed September 10, 2018
Stockholders Agreement, dated as of October 15, 2009 between General Motors Company, the United States
10.1
10.1 Stockholders Agreement, dated as of October 15, 2009 between General Motors Company, the United States
Department of the Treasury, Canada GEN Investment Corporation (fka 7176384 Canada Inc.), the UAW
Department of the Treasury, Canada GEN Investment Corporation (fka 7176384 Canada Inc.), the UAW
Retiree Medical Benefits Trust, and, for limited purposes, General Motors LLC, incorporated herein by
Retiree Medical Benefits Trust, and, for limited purposes, General Motors LLC, incorporated herein by
reference to Exhibit 10.8 to the Current Report on Form 8-K of General Motors Company filed November
reference to Exhibit 10.8 to the Current Report on Form 8-K of General Motors Company filed November
16, 2009
16, 2009
Equity Registration Rights Agreement, dated as of October 15, 2009, between General Motors Company, the
10.2
10.2 Equity Registration Rights Agreement, dated as of October 15, 2009, between General Motors Company, the
United States Department of Treasury, Canada GEN Investment Corporation (fka 7176384 Canada Inc.), the
United States Department of Treasury, Canada GEN Investment Corporation Oka 7176384 Canada Inc.), the
UAW Retiree Medical Benefits Trust, Motors Liquidation Company, and, for limited purposes, General Motors
UAW Retiree Medical Benefits Trust, Motors Liquidation Company, and, for limited purposes, General Motors
LLC, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of Motors Liquidation
LLC, incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K ofMotors Liquidation
Company filed October 21, 2009
Company filed October 21, 2009
Letter Agreement regarding Equity Registration Rights Agreement, dated October 21, 2010, among General
10.3
10.3 Letter Agreement regarding Equity Registration Rights Agreement, dated October 21, 2010, among General
Motors Company, the United States Department of Treasury, Canada GEN Investment Corporation, the UAW
Motors Company, the United States Department of Treasury, Canada GEN Investment Corporation, the UAW
Retiree Medical Benefits Trust and Motors Liquidation Company, incorporated herein by reference to Exhibit
Retiree Medical Benefits Trust and Motors Liquidation Company, incorporated herein by reference to Exhibit
10.43 to Amendment No. 5 to the Registration Statement on Form S-1 (File No. 333-168919) of General
10.43 to Amendment No. 5 to the Registration Statement on Form S-1 (File No. 333-168919) of General
Motors Company filed November 3, 2010
Motors Company filed November 3, 2010
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Form of Compensation Statement, incorporated herein by reference to Exhibit 10.14 to the Annual Report on
10.4*
10.4* Form of Compensation Statement, incorporated herein by reference to Exhibit 10.14 to the Annual Report on
Form 10-K of General Motors Company filed April 7, 2010
Form 10-K of General Motors Company filed April 7, 2010
Incorporated by
Incorporated by
Reference
Reference
10.5*
10.5*
General Motors Company Executive Retirement Plan, with modifications through October 10, 2012,
General Motors Company Executive Retirement Plan, with modifications through October 10, 2012,
incorporated herein by reference to Exhibit 10.12 to the Annual Report on Form 10-K of General Motors
incorporated herein by reference to Exhibit 10.12 to the Annual Report on Form 10-K of General Motors
Company filed February 15, 2013
Company filed February 15, 2013
Incorporated by
Incorporated by
Reference
Reference
Amendment No. 1 to General Motors Company Executive Retirement Plan, with modifications through
10.6*
10.6* Amendment No. 1 to General Motors Company Executive Retirement Plan, with modifications through
October 10, 2012, incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K of
October 10, 2012, incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K of
General Motors Company filed February 3, 2016
General Motors Company filed February 3,2016
Incorporated by
Incorporated by
Reference
Reference
10.7*
General Motors Company 2014 Long-Term Incentive Plan, incorporated herein by reference to Exhibit 10.1
10.7* General Motors Company 2014 Long-Term Incentive Plan, incorporated herein by reference to Exhibit 10.1
to the Current Report on Form 8-K of General Motors Company filed June 12, 2014
to the Current Report on Form 8-K of General Motors Company filed June 12,2014
Incorporated by
Incorporated by
Reference
Reference
Form of Non-Qualified Stock Option Agreement under the 2014 Long-Term Incentive Plan, incorporated
10.8*
10.8* Form of Non-Qualified Stock Option Agreement under the 2014 Long-Term Incentive Plan, incorporated
herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors Company filed July
herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors Company filed July
30, 2015
30, 2015
Form of General Motors Company Performance Share Unit Award Agreement under the 2014 Long-Term
10.9*
10.9* Form of General Motors Company Performance Share Unit Award Agreement under the 2014 Long-Term
Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of
Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of
General Motors Company filed April 28, 2017
General Motors Company filed April 28,2017
10.10*
10.10* General Motors Company 2016 Equity Incentive Plan, incorporated herein by reference to Exhibit 99.1 to the
General Motors Company 2016 Equity Incentive Plan, incorporated herein by reference to Exhibit 99.1 to the
Registration Statement on Form S-8 of General Motors Company filed May 13, 2016
Registration Statement on Form S-8 of General Motors Company filed May 13, 2016
General Motors Company Vehicle Operations - Senior Management Vehicle Program (SMVP) Supplement,
10.11*
10.11* General Motors Company Vehicle Operations - Senior Management Vehicle Program (SMVP) Supplement,
revised December 15, 2005, incorporated herein by reference to Exhibit 10(g) to the Annual Report on Form
revised December 15, 2005, incorporated herein by reference to Exhibit 10(g) to the Annual Report on Form
10-K of Motors Liquidation Company filed March 28, 2006
10-K of Motors Liquidation Company filed March 28, 2006
10.12*
10.12* Form of Director and Officer Indemnification Agreement, incorporated herein by reference to Exhibit 10.6
Form of Director and Officer Indemnification Agreement, incorporated herein by reference to Exhibit 10.6
to the Quarterly Report on Form 10-Q of General Motors Company filed April 21, 2016
to the Quarterly Report on Form 10-Q of General Motors Company filed April 21, 2016
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
10.13*
10.13* General Motors Company 2017 Short-Term Incentive Plan, incorporated herein by reference to Exhibit 10.25
General Motors Company 2017 Short-Term Incentive Plan, incorporated herein by reference to Exhibit 10.25
to the Annual Report on Form 10-K of General Motors Company filed February 6, 2018
to the Annual Report on Form 10-K of General Motors Company filed February 6, 2018
Incorporated by
Incorporated by
Reference
Reference
10.14*
10.14* General Motors Company 2017 Long-Term Incentive Plan, incorporated herein by reference to Exhibit 4.1
General Motors Company 2017 Long-Term Incentive Plan, incorporated herein by reference to Exhibit 4.1
to the Registration Statement on Form S-8 of General Motors Company filed June 16, 2017
to the Registration Statement on Form S-8 of General Motors Company filed June 16, 2017
Form of Performance Share Unit Award Agreement under the General Motors Company 2017 Long-Term
10.15*
10.15* Form of Performance Share Unit Award Agreement under the General Motors Company 2017 Long-Term
Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of
Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of
General Motors Company filed April 26, 2018
General Motors Company filed April 26, 2018
Form of Non-Qualified Stock Option Award Agreement under the General Motors Company 2017 Long-Term
10.16*
10.16* Form ofNon-Qualified Stock Option Award Agreement under the General Motors Company 2017 Long-Term
Incentive Plan, incorporated herein by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q of
Incentive Plan, incorporated herein by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q of
General Motors Company filed April 26, 2018
General Motors Company filed April 26, 2018
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
97
97
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit
Exhibit
Number
Number
10.17*
10.17* Amended and Restated General Motors LLC U.S. Executive Severance Program, incorporated by reference
Amended and Restated General Motors LLC U.S. Executive Severance Program, incorporated by reference
to Exhibit 10.23 to the Annual Report on Form 10-K of General Motors Company filed February 6, 2019
to Exhibit 10.23 to the Annual Report on Form 10-K of General Motors Company filed February 6, 2019
Form of Time Sharing Agreement, incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form
10.18*
10.18* Form of Time Sharing Agreement, incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form
10-Q of General Motors Company filed October 29, 2019
10-Q of General Motors Company filed October 29, 2019
Exhibit Name
Exhibit Name
10.19*
The General Motors Company Deferred Compensation Plan for Non-Employee Directors
10.19* The General Motors Company Deferred Compensation Plan for Non-Employee Directors
10.20†
10.20t Amended and Restated Master Agreement, dated as of December 19,2012, between General Motors Holdings
Amended and Restated Master Agreement, dated as of December 19, 2012, between General Motors Holdings
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.24 to the Annual Report on Form 10-
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.24 to the Annual Report on Form 10-
K of General Motors Company filed February 6, 2014
K of General Motors Company filed February 6,2014
10.21
10.21 Amendment, dated May 2, 2017 to the Master Agreement between General Motors Holdings, LLC and
Amendment, dated May 2, 2017 to the Master Agreement between General Motors Holdings, LLC and
Peugeot S.A., incorporated herein by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q of
Peugeot S.A., incorporated herein by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q of
General Motors Company filed July 25, 2017
General Motors Company filed July 25, 2017
Amendment Number 2, dated July 30, 2017, to the Master Agreement between General Motors Holdings,
10.22
10.22 Amendment Number 2, dated July 30, 2017, to the Master Agreement between General Motors Holdings,
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-
Q of General Motors Company filed October 24, 2017
Q of General Motors Company filed October 24, 2017
10.23
10.23 Amendment Number 3, dated October 30,2017, to the Master Agreement between General Motors Holdings,
Amendment Number 3, dated October 30, 2017, to the Master Agreement between General Motors Holdings,
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.31 to the Annual Report on Form 10-
LLC and Peugeot S.A., incorporated herein by reference to Exhibit 10.31 to the Annual Report on Form 10-
K of General Motors Company filed February 6, 2018
K of General Motors Company filed February 6,2018
10.24†
10.24f Third Amended and Restated 3 -Year Revolving Credit Agreement, dated as ofApril 18,2018, among General
Third Amended and Restated 3-Year Revolving Credit Agreement, dated as of April 18, 2018, among General
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre, General Motors
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre, General Motors
do Brasil Ltda., the subsidiary borrowers from time to time parties thereto, the several lenders from time to
do Brasil Ltda., the subsidiary borrowers from time to time parties thereto, the several lenders from time to
time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication
time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication
agent, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors
agent, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors
Company filed April 20, 2018
Company filed April 20, 2018
10.25†
10.25f Third Amended and Restated 5-Year Revolving Credit Agreement, dated as ofApril 18,2018, among General
Third Amended and Restated 5-Year Revolving Credit Agreement, dated as of April 18, 2018, among General
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre, General Motors
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre, General Motors
do Brasil Ltda., the subsidiary borrowers from time to time parties thereto, the several lenders from time to
do Brasil Ltda., the subsidiary borrowers from time to time parties thereto, the several lenders from time to
time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication
time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication
agent, incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of General Motors
agent, incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of General Motors
Company filed April 20, 2018
Company filed April 20, 2018
10.26†
10.26t 3-Year Revolving Credit Agreement among General Motors Company, the several lenders from time to time
3-Year Revolving Credit Agreement among General Motors Company, the several lenders from time to time
parties thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication agent,
parties thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication agent,
incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors
incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of General Motors
Company filed January 14, 2019
Company filed January 14,2019
10.27†
10.27f Amended and Restated 364-Day Revolving Credit Agreement, dated as of April 16, 2019, among General
Amended and Restated 364-Day Revolving Credit Agreement, dated as of April 16, 2019, among General
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre Limited, the
Motors Company, General Motors Financial Company, Inc., GM Global Treasury Centre Limited, the
subsidiary borrowers from time to time parties thereto, the several lenders from time to time parties thereto,
subsidiary borrowers from time to time parties thereto, the several lenders from time to time parties thereto,
JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication agent, incorporated
JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as syndication agent, incorporated
by reference herein to Exhibit 10.1 to the Current Report on Form 8-K of General Motors Company filed
by reference herein to Exhibit 10.1 to the Current Report on Form 8-K of General Motors Company filed
April 16, 2019
April 16, 2019
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Filed Herewith
Filed Herewith
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
Incorporated by
Incorporated by
Reference
Reference
10.28
10.28 Fifth Amended and Restated Limited Liability Company Agreement of GM Cruise Holdings LLC, dated
Fifth Amended and Restated Limited Liability Company Agreement of GM Cruise Holdings LLC, dated
December 18, 2019
December 18, 2019
Filed Herewith
Filed Herewith
21
21
23.1
23.1
23.2
23.2
24
24
31.1
31.1
31.2
31.2
Subsidiaries and Joint Ventures of the Registrant as of December 31, 2019
Subsidiaries and Joint Ventures of the Registrant as of December 31, 2019
Consent of Ernst & Young LLP
Consent of Ernst & Young LLP
Consent of Deloitte & Touche LLP
Consent of Deloitte & Touche LLP
Power of Attorney for Directors of General Motors Company
Power of Attorney for Directors of General Motors Company
Section 302 Certification of the Chief Executive Officer
Section 302 Certification of the Chief Executive Officer
Section 302 Certification of the Chief Financial Officer
Section 302 Certification of the Chief Financial Officer
32
32
Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
Act of 2002
The following financial information from the Company’s Annual Report on Form 10-K for the year ended
101
101 The following financial information from the Company's Annual Report on Form 10-K for the year ended
December 31, 2019 formatted in Inline Extensible Business Reporting Language (iXBRL) includes: (i) the
December 31, 2019 formatted in Inline Extensible Business Reporting Language (iXBRL) includes: (i) the
Consolidated Income Statements, (ii) the Consolidated Statements of Comprehensive Income, (iii) the
Consolidated Income Statements, (ii) the Consolidated Statements of Comprehensive Income, (iii) the
Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated
Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated
Statements of Equity and (vi) Notes to the Consolidated Financial Statements
Statements of Equity and (vi) Notes to the Consolidated Financial Statements
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Filed Herewith
Furnished with
Furnished with
this Report
this Report
Filed Herewith
Filed Herewith
98
98
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit
Exhibit
Number
Number
Filed Herewith
104
104 The cover page from the Company's Annual Report on Form 10-K for the year ended December 31, 2019, Filed Herewith
The cover page from the Company's Annual Report on Form 10-K for the year ended December 31, 2019,
formatted as Inline XBRL and contained in Exhibit 101
formatted as Inline XBRL and contained in Exhibit 101
Exhibit Name
Exhibit Name
_________
†
*
Certain confidential portions have been omitted pursuant to a granted request for confidential treatment, which has been separately
Certain confidential portions have been omitted pursuant to a granted request for confidential treatment, which has been separately
filed with the SEC.
filed with the SEC.
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 15(b) of this
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 15(b) of this
Report.
Report.
Item 16. Form 10-K Summary
Item 16. Form 10-K Summary
None
None
* * * * * * *
* * * * * * *
99
99
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
SIGNATURES
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934. the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: February 5, 2020
Date: February 5, 2020
GENERAL MOTORS COMPANY (Registrant)
GENERAL MOTORS COMPANY (Registrant)
By:
/s/ MARY T. BARRA
By: /s/ MARY T. BARRA
Mary T. Barra
Mary T. Barra
Chairman and Chief Executive Officer
Chairman and Chief Executive Officer
100
100
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on this 5th day of February
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on this 5th day of February
2020 by the following persons on behalf of the registrant and in the capacities indicated, including a majority of the directors.
2020 by the following persons on behalf of the registrant and in the capacities indicated, including a majority of the directors.
Signature
Title
Signature Title
/s/ MARY T. BARRA
Chairman and Chief Executive Officer
/s/ MARY T. BARRA Chairman and Chief Executive Officer
Mary T. Barra
Mary T. Barra
Executive Vice President and Chief Financial Officer
/s/ DHIVYA SURYADEVARA
/s/ DHIVYA SURYADEVARA Executive Vice President and Chief Financial Officer
Dhivya Suryadevara
Dhivya Suryadevara
/s/ CHRISTOPHER T. HATTO
Vice President, Global Business Solutions and Chief
/s/ CHRISTOPHER T. HATTO Vice President, Global Business Solutions and Chief
Accounting Officer
Christopher T. Hatto
Christopher T. Hatto Accounting Officer
/s/ THEODORE M. SOLSO*
/s/ THEODORE M. SOLSO*
Theodore M. Solso
Theodore M. Solso
/s/ WESLEY G. BUSH*
/s/ WESLEY G. BUSH*
Wesley G. Bush
Wesley G. Bush
/s/ LINDA R. GOODEN*
/s/ LINDA R. GOODEN*
Linda R. Gooden
Linda R. Gooden
/s/ JOSEPH JIMENEZ*
/s/ JOSEPH JIMENEZ*
Joseph Jimenez
Joseph Jimenez
/s/ JANE L. MENDILLO*
/s/ JANE L. MENDILLO*
Jane L. Mendillo
Jane L. Mendillo
/s/ JUDITH A. MISCIK*
/s/ JUDITH A. MISCIK*
Judith A. Miscik
Judith A. Miscik
/s/ PATRICIA F. RUSSO*
/s/ PATRICIA F. RUSSO*
Patricia F. Russo
Patricia F. Russo
/s/ THOMAS M. SCHOEWE*
/s/ THOMAS M. SCHOEWE*
Thomas M. Schoewe
Thomas M. Schoewe
/s/ CAROL M. STEPHENSON*
/s/ CAROL M. STEPHENSON*
Carol M. Stephenson
Carol M. Stephenson
/s/ DEVIN N. WENIG*
/s/ DENTIN N. WENIG*
Devin N. Wenig
Devin N. Wenig
Lead Director
Lead Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
*By:
/s/ RICK HANSEN
*By: /s/ RICK HANSEN
Rick Hansen
Rick Hansen
Attorney-in-Fact
Attorney-in-Fact
101
101
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit 31.1
Exhibit 31.1
I, Mary T. Barra, certify that:
I, Mary T. Barra, certify that:
1. I have reviewed this Annual Report on Form 10-K of General Motors Company;
1. I have reviewed this Annual Report on Form 10-K of General Motors Company;
CERTIFICATION
CERTIFICATION
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in
3. Based on my knowledge, the fmancial statements, and other financial information included in this report, fairly present in
all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
in this report;
in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined
procedures (as defmed in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over fmancial reporting (as defmed
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries,
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the period in which this report is being prepared;
is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be
b) Designed such internal control over fmancial reporting, or caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and
report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the
d) Disclosed in this report any change in the registrant's internal control over fmancial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially
registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
affected, or is reasonably likely to materially affect, the registrant's internal control over fmancial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the Audit Committee of the registrant's Board of Directors (or persons performing
financial reporting, to the registrant's auditors and the Audit Committee of the registrant's Board of Directors (or persons performing
the equivalent functions):
the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
a) All significant deficiencies and material weaknesses in the design or operation of internal control over fmancial reporting
which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial
which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report fmancial
information; and
information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant's internal control over financial reporting.
registrant's internal control over financial reporting.
Date: February 5, 2020
Date: February 5,2020
/s/ MARY T. BARRA
/s/ MARY T. BARRA
Mary T. Barra
Mary T. Barra
Chairman and Chief Executive Officer
Chairman and Chief Executive Officer
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit 31.2
Exhibit 31.2
I, Dhivya Suryadevara, certify that:
I, Dhivya Suryadevara, certify that:
1. I have reviewed this Annual Report on Form 10-K of General Motors Company;
1. I have reviewed this Annual Report on Form 10-K of General Motors Company;
CERTIFICATION
CERTIFICATION
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in
3. Based on my knowledge, the fmancial statements, and other financial information included in this report, fairly present in
all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented
in this report;
in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined
procedures (as defmed in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over fmancial reporting (as defmed
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries,
under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the period in which this report is being prepared;
is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be
b) Designed such internal control over fmancial reporting, or caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this
report based on such evaluation; and
report based on such evaluation; and
d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the
d) Disclosed in this report any change in the registrant's internal control over fmancial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially
registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
affected, or is reasonably likely to materially affect, the registrant's internal control over fmancial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the Audit Committee of the registrant's Board of Directors (or persons performing
financial reporting, to the registrant's auditors and the Audit Committee of the registrant's Board of Directors (or persons performing
the equivalent functions):
the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting
a) All significant deficiencies and material weaknesses in the design or operation of internal control over fmancial reporting
which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial
which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report fmancial
information; and
information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrant's internal control over financial reporting.
registrant's internal control over financial reporting.
Date: February 5, 2020
Date: February 5,2020
/s/ DHIVYA SURYADEVARA
/s/ DHIVYA SURYADEVARA
Dhivya Suryadevara
Dhivya Suryadevara
Executive Vice President and Chief Financial Officer
Executive Vice President and Chief Financial Officer
GENERAL MOTORS COMPANY AND SUBSIDIARIES
GENERAL MOTORS COMPANY AND SUBSIDIARIES
Exhibit 32
Exhibit 32
CERTIFICATION PURSUANT TO
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of General Motors Company (the “Company”) on Form 10-K for the period ended
In connection with the Annual Report of General Motors Company (the "Company") on Form 10-K for the period ended
December 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned
December 31,2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned
officers of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002,
officers of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002,
that to the best of such officer's knowledge:
that to the best of such officer's knowledge:
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 19341 and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
operations of the Company.
/s/ MARY T. BARRA
/s/ MARY T. BARRA
Mary T. Barra
Mary T. Barra
Chairman and Chief Executive Officer
Chairman and Chief Executive Officer
/s/ DHIVYA SURYADEVARA
/s/ DHIVYA SURYADEVARA
Dhivya Suryadevara
Dhivya Suryadevara
Executive Vice President and Chief Financial Officer
Executive Vice President and Chief Financial Officer
Date: February 5, 2020
Date: February 5, 2020
[THIS PAGE INTENTIONALLY LEFT BLANK]
[THIS PAGE INTENTIONALLY LEFT BLANK]
[THIS PAGE INTENTIONALLY LEFT BLANK]
[THIS PAGE INTENTIONALLY LEFT BLANK]
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
(cid:3)
GENERAL MOTORS
(cid:3)