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General Motors Company
2010 Annual Report
This is
the New GM.

Table of contents

  • Page 1
    This is the New GM. Generap Motors Company 2010 Annual Report

  • Page 2
    about the CoVer: Featured on the cover is the Chevrolet Volt, the 2011 North American Car of the Year and Motor Trend Car of the Year.

  • Page 3
    ... sheet. We have a new team, focused on delivering results. We have the number-one market share in the world's highest-growth markets. We have the breakthrough new technology of the Volt as evidence of what we can do. And we're just getting started. General Motors Company 2010 Annual Report 1

  • Page 4
    ... restructuring plan in europe to position our business to operate at a lower break-even level. "our plan is to steadily invest in creating world-class vehicles, which will continuously drive our cycle of great design, high quality and higher profitability." in the United states, GM saw robust sales...

  • Page 5
    ...expanding the financing options for customers in the United states and Canada who want to buy or lease new GM vehicles. We lowered our cost base and restructured operations in north America to achieve a break-even level near the bottom of the economic cycle. Despite depressed industry conditions, GM...

  • Page 6
    The 2011 north American and Motor Trend Car of the Year Chevrolet Volt performs on the road and for the environment. After a groundbreaking development process, GM launched the Chevrolet Volt electric vehicle with extended-range capability in November 2010. The vehicle underscores GM's commitment to...

  • Page 7
    ... steps toward fully funding our U.s. pension plans. BUilDinG THe neW GM For the first time in decades, the playing field in the auto business is level. now, the best car truly can win. GM can now dedicate its full attention to designing, building and selling the world's best vehicles-something that...

  • Page 8
    ... leaner vehicle inventories, we are reducing the need to offer sales incentives on our vehicles. These moves, combined with offering attractive, high-quality vehicles, are driving healthier margins-and at the same time building stronger brands. 6 General Motors Company 2010 Annual Report

  • Page 9
    ...cycle GM Vision Design, build and sell the world's best vehicles BUILD Optimizing our global footprint to cost-effectively develop best-in-segment vehicles SELL Maximizing revenues with a focused brand strategy; delivering world-class vehicles to market General Motors Company 2010 Annual Report...

  • Page 10
    ... performance in 2010, delivering record volume, up 60 percent year over year, and an overall 0.6 point gain in market share. Brazil is the world's fifth-largest vehicle market, and GM is one of the top automakers there with a 19 percent market share. 8 General Motors Company 2010 Annual Report

  • Page 11
    ... 12.2 #1 GM Market Position in 2010 North America 6.0 #1 GM Market Position in 2010 All Other 4.2 #3 GM Market Position in 2010 Source: IHS Automotive car and light truck sales forecast March 2011 *Brazil, Russia, India, China; includes joint ventures General Motors Company 2010 Annual Report 9

  • Page 12
    ... financial performance over the long term. Minimizing financial leverage and maintaining cost discipline will help ensure we are able to do so. discipline in north America have allowed us to achieve breakeven near the bottom of the industry cycle. 10 General Motors Company 2010 Annual Report

  • Page 13
    ... in billions) 36.9 33.5 Automotive Debt ($ in billions) 15.8 4.6 Dec. 31, 2009 Dec. 31, 2010 Dec. 31, 2009 Dec. 31, 2010 Automotive Liquidity includes: cash, marketable securities, certain escrow restricted cash and available credit facilities General Motors Company 2010 Annual Report 11

  • Page 14
    ... five-door hatchback versions of the Chevrolet sonic will be in U.s. showrooms in fall 2011. Currently the only small car built in the United states, it will be sold as the Aveo in other parts of the world. Buick LaCrosse Buick builds on the brand's momentum in the United states and China with the...

  • Page 15
    ...sport Wagon sets a new standard for versatility, while offering excitement and purpose. Cadillac SRX The Cadillac sRX looks and performs like no other crossover, with a cockpit that offers utility and elegance and an optional 70-inch Ultraview sunroof. General Motors Company 2010 Annual Report 13

  • Page 16
    A World-Class Lineup Around the World Chevy Orlando Using our global compact architecture, Chevrolet is launching the new orlando seven-seat family van in select markets worldwide in 2011. Baojun 630 The all-new Baojun 630 debuted in China in 2010-our new affordable vehicle brand designed to appeal...

  • Page 17
    ... technology to new markets. The New GM's vehicle lineup had a banner year for honors and awards in 2010, capturing many of the industry's most prestigious awards, including the Motor Trend Car and Truck of the Year for the Chevrolet Volt and Silverado HD; North American Car of the Year for the Volt...

  • Page 18
    ... values simplicity, agility and action-making and implementing decisions faster, pushing accountability deeper into the organization and demanding results from everyone. There's never been a greater need to change, and there's never been a better time. 16 General Motors Company 2010 Annual Report

  • Page 19
    ... northern santa Fe Corporation Director since July 24, 2009 Victoria McInnis Chief Tax officer Chester N. Watson General Auditor Committees: 1 Audit, 2 executive Compensation, 3 Directors and Corporate Governance, 4 Public Policy, 5 Finance and Risk General Motors Company 2010 Annual Report 17

  • Page 20
    ...10 in GM Common stock, in the s&P 500, and in Ford 2010 VEHICLE SALES, INCLUDING JOINT VENTURES - (000'S UNITS) GMnA GMe GMio GMsA Worldwide Vehicle Sales Worldwide Net Sales & Revenue FINANCIAL RESULTS 2,625 1,662 3,077 1,026 8,390 $135,592 earnings Before interest and income Taxes* net income...

  • Page 21
    ... statements of Cash Flows Consolidated statements of equity (Deficit) notes to Consolidated Financial statements Controls and Procedures Financial statement schedule ii - Valuation and Qualifying Accounts 21 22 24 109 117 117 118 119 121 123 284 286 General Motors Company 2010 Annual Report...

  • Page 22
    ... expense income tax expense Net income attributable to stockholders less: Cumulative dividends on and charge related to purchase of preferred stock Net income attributable to common stockholders (a) GM Financial amounts represent income before income taxes. successor Year Ended December 31, 2010...

  • Page 23
    ... available for that purpose. Our payment of dividends in the future will depend on business conditions, our financial condition, earnings, liquidity and capital requirements, the covenants in our new secured revolving credit facility, and other factors. General Motors Company 2010 Annual Report 21

  • Page 24
    ... MOTORS COMPANY AND SUBSIDIARIES (Dollars in millions except per share amounts) Successor July 10, 2009 Year Ended Through December 31, December 31, 2010 (a) 2009 (a)(b) Predecessor January 1, 2009 Through July 9, 2009 Years Ended December 31, 2008 2007 2006 Income Statement Data: Total net sales...

  • Page 25
    ... of operations, cash flows and the 2007 gain on sale of Allison have been reported as discontinued operations for all periods presented. (h) Includes a charge related to the purchase of Series A Preferred Stock of $677 million in the year ended December 31, 2010. (i) (j) In December 2008 Old GM...

  • Page 26
    ... through our five segments, namely GM North America (GMNA), GM Europe (GME), GM International Operations (GMIO), GM South America (GMSA) and General Motors Financial Company, Inc. (GM Financial). In the year ended December 31, 2010 we changed our managerial and financial reporting structure so that...

  • Page 27
    ... respective segments. Our business is diversified across products and geographic markets. With a global network of independent dealers we meet the local sales and service needs of our retail and fleet customers. Of our total 2010 vehicle sales volume, 73.6% was generated outside the United States...

  • Page 28
    ... world's best vehicles, allowing us to maximize sales under any market conditions; Sell our vehicles globally by targeting developed markets, which are projected to have increases in vehicle demand as the global economy recovers, and further strengthening our position in high growth emerging markets...

  • Page 29
    ... brands throughout Europe, we are moving the entire Chevrolet lineup to new global architectures. Increase sales in GMIO, particularly in China. We plan to continue to execute our growth strategies in countries where we already hold strong positions, such as China, and to improve market share...

  • Page 30
    ... in the United States and Canada throughout economic cycles. We also plan to use GM Financial to initiate targeted customer marketing initiatives to expand our vehicle sales. Reduce breakeven levels through improved revenue realization and a competitive cost structure. In developed markets, we are...

  • Page 31
    ... The ability to execute capital markets transactions or sales of assets was extremely limited, vehicle sales in North America and Western Europe contracted severely, and the pace of vehicle sales in the rest of the world slowed. Old GM's liquidity position, as well as its operating performance, were...

  • Page 32
    ... indebtedness and VEBA obligations. Indebtedness and VEBA Obligations In April 2009 Old GM commenced exchange offers for certain unsecured notes to reduce its unsecured debt in order to comply with the debt reduction condition of the UST Loan Agreement. 30 General Motors Company 2010 Annual Report

  • Page 33
    ...to effect reductions in salaried employment levels. Old GM had also negotiated a revised labor agreement with the CAW to reduce its hourly labor costs to approximately the level paid to the transplant automakers; however, such agreement was contingent upon receiving longer term financial support for...

  • Page 34
    GENERAL MOTORS COMPANY AND SUBSIDIARIES The following table summarizes the total funding and funding commitments Old GM received from the U.S. and Canadian governments and the additional notes Old GM issued related thereto in the period December 31, 2008 through July 9, 2009 (dollars in millions): ...

  • Page 35
    ... stock. On or after December 31, 2014 we may redeem, in whole or in part, the shares of Series A Preferred Stock outstanding, at a redemption price per share equal to $25.00 per share plus any accrued and unpaid dividends, subject to limited exceptions. General Motors Company 2010 Annual Report...

  • Page 36
    ...Old GM prepared its consolidated financial statements in accordance with the guidance in ASC 852 in the period June 1, 2009 through July 9, 2009. Revenues, expenses, realized gains and losses, and provisions for losses directly related to the Chapter 11 34 General Motors Company 2010 Annual Report

  • Page 37
    ...A Preferred Stock, held by the UST, at a price equal to 102% of the aggregate liquidation amount, for $2.1 billion. The purchase of the UST's Series A Preferred Stock resulted in a charge of $0.7 billion. Contribution of Cash and Common Stock to U.S. Hourly and Salaried Pension Plans In October 2010...

  • Page 38
    ... with a wide array of vehicle safety and information services. Used Car JV is our joint venture with SAIC that will cooperate with current distributors of SGM products in the establishment of dedicated used car sales and service facilities across China. 36 General Motors Company 2010 Annual Report

  • Page 39
    GENERAL MOTORS COMPANY AND SUBSIDIARIES The following table summarizes certain key operational and financial data for the China JVs (dollars in millions): Years Ended December 31, 2010 December 31, 2009 Total wholesale units ...Market share ...Total net sales and revenues ...Net income ... 2,348,...

  • Page 40
    ...year ended December 31, 2010. This represents an increase of 131,000 vehicles (or 6.3%) from our and Old GM's U.S. vehicle sales in the year ended December 31, 2009. This increase reflects our brand rationalization strategy to focus our product engineering and design and marketing on our four brands...

  • Page 41
    ... contemplated by the DMDA, we waived administrative claims associated with our advance agreements with Delphi, the payment terms acceleration agreement with Delphi and the claims associated with previously transferred pension costs for hourly employees. General Motors Company 2010 Annual Report 39

  • Page 42
    ... 24, 2011. We can cause the trustee to return any Ally Financial common stock to us to hold directly, so long as our directly held voting and total common equity interests remain below 10%. Special Attrition Programs, Labor Agreements and Benefit Plan Changes During 2009 we and Old GM implemented...

  • Page 43
    ...introducing co-payments for healthcare benefits, increasing employee healthcare cost sharing, freezing pension benefits and eliminating cost of living adjustments to pensions for retired hourly workers. The 2009 CAW Agreement was conditioned on Old GM receiving longer term financial support from the...

  • Page 44
    ...July 9, 2009. Total net sales and revenue was not significantly affected by fresh-start reporting and therefore we combined vehicle sales data comparing the Successor and Predecessor periods. Refer to Note 2 to our consolidated financial statements for additional information on fresh-start reporting...

  • Page 45
    ..., support services, including central office expenses, labor and benefit expenses for employees not considered part of the manufacturing process, consulting costs, rental expense for offices, bad debt expense and non-income based state and local taxes. General Motors Company 2010 Annual Report 43

  • Page 46
    ... 31, 2010 Year Ended December 31, 2008 Net sales and revenue Automotive sales ...GM Financial and other revenue ...Other automotive revenue ...Total net sales and revenue ...Costs and expenses Automotive cost of sales ...GM Financial operating expenses and other ...Automotive selling, general and...

  • Page 47
    ...' vehicle sales. (g) The joint venture agreements with SGMW (44%) and FAW-GM (50%) allow for significant rights as a member as well as the contractual right to report SGMW and FAW-GM joint venture vehicle sales in China as part of our global market share. General Motors Company 2010 Annual Report...

  • Page 48
    ... our automotive segments EBIT and GM Financial's income before income taxes to Net income (loss) attributable to stockholders (dollars in millions): Successor Year Ended December 31, 2010 July 10, 2009 Through December 31, 2009 Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31...

  • Page 49
    GENERAL MOTORS COMPANY AND SUBSIDIARIES Total Net Sales and Revenue (Dollars in Millions) Successor Combined GM and Old GM Successor Predecessor Year Ended 2009 vs. 2008 Change Amount % Year Ended 2010 vs. 2009 July 10, 2009 January 1, 2009 Change Year Ended Year Ended Through Through Year Ended ...

  • Page 50
    ... low levels and Automotive cost of sales, including costs that are fixed in nature, exceeding Total net sales and revenue. In the year ended December 31, 2008 Automotive cost of sales included: (1) restructuring charges and other costs of $6.0 billion related to Old GM's special attrition programs...

  • Page 51
    ... the positive effects of various cost savings initiatives, the cancellation of certain sales and promotion contracts as a result of the Chapter 11 Proceedings in the U.S. and overall reductions in advertising and marketing budgets. In the year ended December 31, 2008 Automotive selling, general and...

  • Page 52
    ...of automotive retail leases; and (5) interest expense of $0.1 billion. Equity in Income (Loss) of and Disposition of Interest in Ally Financial Predecessor January 1, 2009 Through July 9, 2009 Percentage of Total net sales and revenue Percentage of Total net sales and revenue Year Ended December 31...

  • Page 53
    ... expense of $0.1 billion on Old GM's secured revolving credit facility and U.S. term loan. Interest Income and Other Non-Operating Income, net Successor Percentage of July 10, 2009 Percentage of Year Ended Total Through Total December 31, net sales December 31, net sales 2010 and revenue 2009...

  • Page 54
    ... shares of common stock in exchange for $498 million principal amount of Old GM's Series D debentures, which were retired and canceled. Reorganization gains, net Predecessor January 1, 2009 Through July 9, 2009 Reorganization gains, net ... $128,155 52 General Motors Company 2010 Annual Report

  • Page 55
    ... of net liabilities retained by MLC of $25.2 billion; and (4) the fair value of Series A Preferred stock, common shares and warrants issued in connection with the 363 Sale of $20.5 billion. Income Tax Expense (Benefit) Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009...

  • Page 56
    GENERAL MOTORS COMPANY AND SUBSIDIARIES GM In the year ended December 31, 2010 Equity income, net of tax included equity income of $1.3 billion related to our China JVs, primarily SGM and SGMW and equity income of $0.1 billion related to New Delphi. In the period July 10, 2009 through December 31, ...

  • Page 57
    GENERAL MOTORS COMPANY AND SUBSIDIARIES Changes in Consolidated Financial Condition (Dollars in Millions, Except Share Amounts) Successor December 31, 2010 December 31, 2009 ASSETS Automotive Current Assets Cash and cash equivalents ...Marketable securities ...Total cash, cash equivalents and ...

  • Page 58
    ...Deferred income taxes of $0.3 billion decreased by $0.3 billion (or 45.4%) primarily due to reclassifications of deferred tax assets and changes in the allocation of valuation allowances resulting from underlying changes in the timing of tax deductions. 56 General Motors Company 2010 Annual Report

  • Page 59
    ... increased number of vehicles leased to daily rental car companies of $0.5 billion; (2) increase due to tax related accruals reclassified from non-current to current of $0.3 billion; and (3) other miscellaneous accruals of $0.3 billion. Non-Current Liabilities At December 31, 2010 Long-term debt of...

  • Page 60
    ... the asset backed securities market and advances on credit facilities of $0.8 billion. GM North America (Dollars in Millions) Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Total net sales...

  • Page 61
    ... Certain fleet sales that are accounted for as operating leases are included in vehicle sales at the time of delivery to the daily rental car companies. GMNA Total Net Sales and Revenue (Dollars in Millions) Successor Year Ended December 31, 2010 Combined GM and Old GM Year Ended December 31, 2009...

  • Page 62
    ... sales related to the CARS program and an increase in dealer showroom traffic and related vehicle sales in response to our new 60-Day satisfaction guarantee program. GMNA Earnings Before Interest and Income Taxes (Dollars in Millions) Successor July 10, 2009 Year Ended Through December 31, 2010...

  • Page 63
    ... Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Total net sales and revenue ...Loss attributable to stockholders before interest and income taxes ... $24,076 $ (1,764) $11,479 $ (814) $12,552 $ (2,815) $34,647 $ (2,625) General Motors Company 2010 Annual Report 61

  • Page 64
    ... differences. (e) Certain fleet sales that are accounted for as operating leases are included in vehicle sales at the time of delivery to the daily rental car companies. GME Total Net Sales and Revenue (Dollars in Millions) Successor Year Ended December 31, 2010 Combined GM and Old GM Year Ended...

  • Page 65
    ... the estimated selling price of the inventory less the costs a market participant would incur to complete, sell and dispose of the inventory, which may be different than our costs, and the profit margin required for its completion and disposal effort. General Motors Company 2010 Annual Report 63

  • Page 66
    ...Germany and the United Kingdom. GM International Operations (Dollars in Millions) Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Total net sales and revenue ...Income (loss) attributable to...

  • Page 67
    ... July 9, 2009 2008 Successor Combined GM and Old GM Successor Year Ended 2010 vs. 2009 Change Amount % Year Ended 2009 vs. 2008 Change Amount % Total net sales and revenue ... $21,470 $14,785 $8,567 $6,218 $24,050 $6,685 45.2% $(9,265) 38.5% General Motors Company 2010 Annual Report 65

  • Page 68
    ...of new vehicle models at GM Daewoo. The vehicle sales related to our China and India (GM India was deconsolidated effective February 2010) joint ventures is not reflected in Total net sales and revenue. The results of our joint ventures are recorded in Equity income, net of tax. GMIO Earnings Before...

  • Page 69
    ... total production volume and new motor vehicle sales volume and competitive position (in thousands): GM Year Ended December 31, 2010 Combined GM and Old GM Year Ended December 31, 2009 Old GM Year Ended December 31, 2008 Production volume ... 926 807 865 General Motors Company 2010 Annual Report...

  • Page 70
    ... fleet sales that are accounted for as operating leases are included in vehicle sales at the time of delivery to the daily rental car companies. GMSA Total Net Sales and Revenue (Dollars in Millions) Successor Year Ended December 31, 2010 Combined GM and Old GM Successor July 10, 2009 Year Ended...

  • Page 71
    ...and sales promotion expenses of $0.2 billion; and (4) selling and marketing expenses of $0.1 billion. GM Financial (Dollars in Millions) Three Months Ended December 31, 2010 Successor Three Months Ended December 31, 2010 Total revenue ...Income before income taxes ... $281 $129 In the three months...

  • Page 72
    ... lease financing revenue of $0.7 billion related to the liquidation of the portfolio of automotive retail leases. Average outstanding leases on-hand for combined GM and Old GM were 73,000 and 236,000 for the years ended December 31, 2009 and 2008. 70 General Motors Company 2010 Annual Report

  • Page 73
    ...; (4) income tax expense of $1.8 billion related to valuation allowances against deferred tax assets in South Korea, the United Kingdom, Spain, and Australia; (5) impairment charges of $1.0 billion related to Old GM's investment in Ally Financial's Preferred Membership Interests; (6) servicing fees...

  • Page 74
    ... the possible sale of non-core cost or equity method investments or other positions which could be significantly positive to our cash flow and/or earnings in the near-term. In the year ended December 31, 2010 we made net investments of $5.4 billion in highly liquid marketable securities instruments...

  • Page 75
    ... pension plans of $4.0 billion of cash in December 2010 and 61 million shares of our common stock valued at $2.2 billion for funding purposes in January 2011. Under wholesale financing arrangements, our U.S. dealers typically borrow money from financial institutions to fund their vehicle purchases...

  • Page 76
    GENERAL MOTORS COMPANY AND SUBSIDIARIES GM Total available liquidity increased by $9.1 billion in the year ended December 31, 2010 primarily due to positive cash flows from operating activities of $6.6 billion, investing activities less net marketable securities acquisitions of $6.1 billion and a ...

  • Page 77
    ... a material adverse change occurs, the UST Credit Agreement provides that we will use our commercially reasonable best efforts to ensure that the volume of United States manufacturing is the minimum variance from the projected manufacturing level that is General Motors Company 2010 Annual Report 75

  • Page 78
    ... debt repayments, dividends, interest, preferred stock redemptions and common stock sales equal to the total dollar amount of all UST invested capital. UST invested capital totaled $49.5 billion, representing the cumulative amount of cash received by Old GM from the UST under the UST Loan Agreement...

  • Page 79
    ... Facility received in the period January 1, 2009 through July 9, 2009 and funding commitments of CAD $4.5 billion (equivalent to $3.9 billion when entered into) that were immediately converted into our equity. This funding was received on July 15, 2009. General Motors Company 2010 Annual Report 77

  • Page 80
    GENERAL MOTORS COMPANY AND SUBSIDIARIES The following table summarizes the effect of the 363 Sale on the amounts owed to the UST and the EDC under the UST Loan Agreement, the DIP Facility and the EDC Loan Facility (dollars in millions): 363 Sale Total Obligation Effect of 363 Sale GM Obligation ...

  • Page 81
    ... in managing our global liquidity. These credit facilities are typically held at the subsidiary level and are geographically dispersed across all regions. The following tables summarize our committed and uncommitted credit facilities at the dates indicated (dollars in millions): Total Credit...

  • Page 82
    ... benefit pension plan, of which $2.7 billion was funded from the escrow account. In accordance with the terms of the escrow agreement, $903 million was released from the escrow account to us in September 2009. Cash Flow Operating Activities GM In the year ended December 31, 2010 we had positive cash...

  • Page 83
    ... volumes had on working capital balances, and postretirement benefit payments. Investing Activities GM In the year ended December 31, 2010 we had positive cash flows from investing activities of $0.7 billion primarily due to: (1) a net decrease in Restricted cash and marketable securities of $13...

  • Page 84
    ...; (4) debt repayments of $1.7 billion; and (5) dividend payments on Old GM common stock of $0.3 billion. Net Liquid Assets Management believes the use of net liquid assets provides meaningful supplemental information regarding our liquidity. We believe net liquid assets is useful in allowing for...

  • Page 85
    ... MOTORS COMPANY AND SUBSIDIARIES The following table summarizes net liquid assets balances (dollars in millions): Successor December 31, December 31, 2010 2009 Cash and cash equivalents ...Marketable securities ...UST Credit Agreement escrow and HCT escrow ...Total liquid assets ...Short-term debt...

  • Page 86
    ... billion for the purchase of finance receivables in the three months ended December 31, 2010. Generally, these purchases are funded initially utilizing cash and borrowings under credit facilities and subsequently funded in securitization transactions. 84 General Motors Company 2010 Annual Report

  • Page 87
    ... notes payable. GM Financial's funding agreements contain various covenants requiring minimum financial ratios, asset quality and portfolio performance ratios (portfolio net loss and delinquency ratios, and pool level cumulative net loss ratios) as well as limits on deferment levels. Failure to...

  • Page 88
    ... GM's policy for qualified defined benefit pension plans is to contribute annually not less than the minimum required by applicable law and regulation, or to directly pay benefit payments where appropriate. At December 31, 2010 all legal funding requirements had been met. 86 General Motors Company...

  • Page 89
    GENERAL MOTORS COMPANY AND SUBSIDIARIES The following table summarizes contributions made to the defined benefit pension plans or direct payments (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, December 31, 2010 2009 Predecessor January 1, 2009 Through Year Ended July...

  • Page 90
    ... net benefit payments expected to be paid in the future, which include assumptions related to estimated future employee service, but does not reflect the effect of the 2009 CAW Agreement which provides for our independent HCT (dollars in millions): Successor Years Ended December 31, Pension Benefits...

  • Page 91
    ... long-term liabilities at December 31, 2010 (dollars in millions): Payments Due by Period 2016 2012-2013 2014-2015 and after 2011 Total Automotive debt (a) ...Automotive Financing debt (b) ...Capital lease obligations ...Automotive interest payments (c) ...Automotive Financing interest payments...

  • Page 92
    ... Base Line point decrease Estimated Return on Assets-7% - 100 basis point decrease 50 basis point increase 50 basis point decrease 2011 2012 2013 2014 2015 2016 ... 0.7 0.7 $1.5 2.3 $1.2 4.0 $1.0 $- $- $- $0.5 $5.1 $0.8 3.1 $2.9 90 General Motors Company 2010 Annual Report

  • Page 93
    ... our non-U.S. pension plans in 2011. Fair Value Measurements Automotive At December 31, 2010 assets and liabilities classified in Level 3 were not significant. Prior to the three months ended December 31, 2010 significant assets and liabilities classified in Level 3, with the related Level 3 inputs...

  • Page 94
    ...funds legally available for that purpose and will depend on business conditions, our financial condition, earnings, liquidity and capital requirements, the covenants in our debt instruments, and other factors. So long as any share of our Series A or B Preferred Stock remains outstanding, no dividend...

  • Page 95
    ...fresh-start reporting. Our reorganization value was determined using the sum of: • Our discounted forecast of expected future cash flows from our business subsequent to the 363 Sale, discounted at rates reflecting perceived business and financial risks; The fair value of operating liabilities; The...

  • Page 96
    GENERAL MOTORS COMPANY AND SUBSIDIARIES Our discounted forecast of expected future cash flows included: • Forecasted cash flows for the six months ended December 31, 2009 and the years ending December 31, 2010 through 2014, for each of Old GM's former segments including GMNA, GME, GM Latin ...

  • Page 97
    .... Assumptions used in our discounted cash flow analysis that have the most significant effect on our estimated reorganization value include Our estimated WACC; Our estimated long-term growth rates; and Our estimate of industry sales and our market share in each of Old GM's former segments. The...

  • Page 98
    ... expected rate of return on plan assets and a discount rate. Due to significant events, including those discussed in Note 20 to our consolidated financial statements, certain of the pension plans were remeasured at various dates in the year ended December 31, 2010, the periods July 10, 2009 through...

  • Page 99
    ... plans in the United Kingdom and Germany use a curve derived from high quality corporate bonds with maturities consistent with the plans' underlying duration of expected benefit payments. The following table summarizes rates used to determine net pension expense: Successor July 10, 2009 Year Ended...

  • Page 100
    ... based on the last remeasurement of the U.S hourly pension plan at December 31, 2010, as a result of changes in future benefit units for U.S. hourly employees, effective after the expiration of the current contract (dollars in millions): Successor Effect on Effect on 2011 December 31, 2010 Pension...

  • Page 101
    ... cash flows to calculate a single equivalent discount rate. All other U.S. OPEB plans started using a discount rate based on a yield curve on July 10, 2009. The UAW retiree medical plan was settled on December 31, 2009 and the plan assets were contributed to the New VEBA as part of the payment terms...

  • Page 102
    ... hourly benefit plans. While we believe our judgments and assumptions are reasonable, changes in the assumptions underlying these estimates, which we revise each quarter, could result in a material effect on the financial statements in a given period. 100 General Motors Company 2010 Annual Report

  • Page 103
    ... are initially determined by consulting independently published residual value guides. Realization of residual values is dependent on the future ability to market vehicles under prevailing market conditions. Over the life of a lease, the adequacy of the General Motors Company 2010 Annual Report 101

  • Page 104
    ... table illustrates the effect of changes in our estimate of vehicle sales proceeds at lease termination on residual support and risk sharing reserves related to vehicles owned by Ally Financial at December 31, 2010 and 2009 holding all other assumptions constant (dollars in millions): Successor...

  • Page 105
    ... our manufacturing operations and the sharing of vehicle platforms among brands, assets and other resources are shared extensively within GMNA and GME and financial information by brand or country is not discrete below the operating segment level such that GMNA and GME do not contain reporting units...

  • Page 106
    ...consolidated financial statements. Assumptions used in our discounted cash flow analysis that have the most significant effect on the estimated fair value of our reporting units include Our estimated WACC; Our estimated long-term growth rates; and Our estimate of industry sales and our market share...

  • Page 107
    ... yields, risk premiums, and tax rates; the terminal values were determined using a growth model that applied a reporting unit's long-term growth rate to its projected cash flows beyond 2014; and industry sales and a market share for each reporting unit included annual estimates through 2014, except...

  • Page 108
    ... preferred stock was $665 million. Derivatives Derivatives are used in the normal course of business to manage exposures arising from market risks resulting from changes in certain commodity prices and interest and foreign currency exchange rates. Derivatives are accounted for in the consolidated...

  • Page 109
    ... liquidity and financing sources and an appropriate level of debt, including as required to fund our planned significant investment in new technology, and, even if funded, our ability to realize successful vehicle applications of new technology; The effect of business or liquidity difficulties...

  • Page 110
    ... pricing policies or use of incentives and the introduction of new and improved vehicle models by our competitors; Significant changes in economic and market conditions in China, including the effect of competition from new market entrants, on our vehicle sales and market position in China; Changes...

  • Page 111
    ... 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 rates would be $513 million and $941 million at December 31, 2010 and 2009. General Motors Company 2010 Annual Report...

  • Page 112
    GENERAL MOTORS COMPANY AND SUBSIDIARIES We are and Old GM was exposed to foreign currency risk due to the translation 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 ...

  • Page 113
    .... As part of our risk management process, we monitor and evaluate the credit standing of the financial institutions with which we do business. The financial institutions with which we do business are generally highly rated and geographically dispersed. General Motors Company 2010 Annual Report 111

  • Page 114
    ..., GM Financial may simultaneously sell a corresponding interest rate cap derivative to offset the premium paid by the trust to purchase the interest rate cap derivative. The fair value of the interest rate cap derivatives purchased in connection with 112 General Motors Company 2010 Annual Report

  • Page 115
    ...liabilities at December 31, 2010 (dollars in millions): Years Ending December 31, 2011 2012 2013 2014 2015 Thereafter December 31, 2010 Fair Value Assets Finance receivables Principal amounts ...Weighted-average annual percentage rate ...Interest rate swap agreements Notional amounts ...Average pay...

  • Page 116
    ...these strategies will be effective in minimizing interest rate risk or that increases in interest rates will not have an adverse effect on GM Financial's profitability. GM Financial does not enter into derivative transactions for speculative purposes 114 General Motors Company 2010 Annual Report

  • Page 117
    ... of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedule of General Motors Company and subsidiaries as of and for the year ended December 31, 2010 (Successor). Our report dated March 1, 2011 expressed an unqualified...

  • Page 118
    ...its Directors, and Stockholders: We have audited the accompanying Consolidated Balance Sheets of General Motors Company and subsidiaries as of December 31, 2010 (Successor) and 2009 (Successor), and the related Consolidated Statements of Operations, Cash Flows and Equity (Deficit) for the year ended...

  • Page 119
    ... revenue ...Total net sales and revenue ...Costs and expenses Automotive cost of sales ...GM Financial operating expenses and other ...Automotive selling, general and administrative expense ...Other automotive expenses, net ...Total costs and expenses ...Operating income (loss) ...Equity in income...

  • Page 120
    ... Long-term debt (including debt at GM Daewoo of $835 at December 31, 2010; Note 17) ...Liabilities held for sale ...Postretirement benefits other than pensions ...Pensions ...Other liabilities and deferred income taxes ...Total non-current liabilities ...Total Automotive Liabilities ...GM Financial...

  • Page 121
    GENERAL MOTORS COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) Successor July 10, 2009 Year Ended Through December 31, December 31, 2010 2009 Predecessor January 1, 2009 Year Ended Through December 31, July 9, 2009 2008 Cash flows from operating activities Net income (...

  • Page 122
    ......Trading marketable securities, liquidations ...Acquisition of companies, net of cash acquired other than cash acquired with GM Financial ...Increase due to consolidation of business units ...Distributions from (investments in) Ally Financial ...Operating leases, liquidations ...Proceeds from sale...

  • Page 123
    ... ...Defined benefit plans, net (Note 29) ...Other comprehensive income (loss) ...Comprehensive income (loss) ...Effects of Ally Financial adoption of ASC 820 and ASC 825 ...Stock options ...Common stock issued for settlement of Series D debentures ...Cash dividends paid to Old GM common stockholders...

  • Page 124
    ... ...Common stock warrants related to settlement of UAW hourly retiree medical plan ...Participation in GM Daewoo equity rights offering ...Purchase of noncontrolling interest in CAMI ...Cash dividends paid on Series A Preferred Stock ...Other ...Balance December 31, 2009, Successor . . Net income...

  • Page 125
    ...vehicle sales in the rest of the world slowed. Old GM's liquidity position, as well as its operating performance, were negatively affected by these economic and industry conditions and by other financial and business factors, many of which were beyond its control. General Motors Company 2010 Annual...

  • Page 126
    ...be unable to pay its obligations in the normal course of business in 2009 or service its debt in a timely fashion, which required the development of a new plan that depended on financial assistance from the U.S. government. In December 2008 Old GM requested and received financial assistance from the...

  • Page 127
    ... Auto Task Force determined that the plan was not viable and required substantial revisions. In conjunction with the March 30, 2009 announcement, the administration announced that it would offer Old GM adequate working capital financing for a period of 60 days while it worked with Old GM to develop...

  • Page 128
    ... employment levels. Old GM had also negotiated a revised labor agreement with the Canadian Auto Workers Union (CAW) to reduce its hourly labor costs to approximately the level paid to the transplant automakers; however, such agreement was contingent upon receiving longer term financial support for...

  • Page 129
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 363 Sale On July 10, 2009 we completed the acquisition of substantially all of the assets and assumed certain liabilities of Old GM and certain of its direct and indirect subsidiaries (collectively, the ...

  • Page 130
    ...The number of shares of our common stock underlying each of the warrants issued to MLC and the New VEBA and the per share exercise price are subject to adjustment as a result of certain events, including stock splits, reverse stock splits and stock dividends. 128 General Motors Company 2010 Annual...

  • Page 131
    ...fresh-start reporting. Our reorganization value was determined using the sum of: • Our discounted forecast of expected future cash flows from our business subsequent to the 363 Sale, discounted at rates reflecting perceived business and financial risks; The fair value of operating liabilities; The...

  • Page 132
    ... changes in global market conditions. • • • • • A terminal value, which was determined using a growth model that applied long-term growth rates ranging from 0.5% to 6.0% and a weighted-average long-term growth rate of 2.6% to our projected cash flows beyond 2014. The long-term growth...

  • Page 133
    .... Assumptions used in our discounted cash flow analysis that have the most significant effect on our estimated reorganization value include Our estimated WACC; Our estimated long-term growth rates; and Our estimate of industry sales and our market share in each of Old GM's former segments. The...

  • Page 134
    ...shares issued to the New VEBA are excluded from common shares outstanding at July 10, 2009. Refer to Note 20 for a discussion of the termination of our UAW hourly retiree medical plan and Mitigation Plan and the resulting payment terms to the New VEBA. 132 General Motors Company 2010 Annual Report

  • Page 135
    ...-term debt ...Postretirement benefits other than pensions ...Pensions ...Liabilities subject to compromise ...Other liabilities and deferred income taxes ...Total non-current liabilities ...Total Liabilities ...Preferred stock ...Equity (Deficit) Old GM Preferred stock ...Preference stock ...Common...

  • Page 136
    ... as part of the 363 Sale (dollars in millions): UST (a) Canada Holdings (b) New VEBA (c) Pension and OPEB (d) MLC (e) Other (f) Total Assets MLC retained, net ...Accounts payable (principally trade) ...Short-term debt and current portion of long-term debt extinguished ...Short-term debt and current...

  • Page 137
    ..., Series A Preferred Stock, common stock and warrants contributed to the New VEBA were not considered outstanding. Refer to Note 20 for additional information on the 2009 UAW Retiree Settlement Agreement. (d) As a result of modifications to benefit plans that became effective upon the 363 Sale, we...

  • Page 138
    ... estimated selling price once completed less total costs to complete the manufacturing process, costs to sell including disposal and holding period costs, a reasonable profit margin on the remaining manufacturing, selling and disposal effort; and • 136 General Motors Company 2010 Annual Report

  • Page 139
    ... changes in local market conditions; A terminal value, which was calculated by assuming a maintainable level of after-tax debt-free cash flow and multiplying it by a capitalization factor that reflected the investor's WACC adjusted for the estimated long-term perpetual growth rate; A discount rate...

  • Page 140
    ... value of technology. The relief from royalty method was used to calculate the $7.7 billion fair value of developed technology. The significant assumptions used included: • Forecasted revenue for each technology category by Old GM's former segments; 138 General Motors Company 2010 Annual Report

  • Page 141
    ... perceived business risks related to these customer relationships. • We recorded other intangible assets of $560 million primarily related to existing contracts, including leasehold improvements, that were favorable relative to available market terms. General Motors Company 2010 Annual Report...

  • Page 142
    ... cash flow approach. The present value of the cash flows was determined using assumptions regarding the expected receipt of dividends on Ally Financial preferred stock and the expected call date. The discount rate of 16.9% was determined based on yields of similar Ally Financial securities. Accounts...

  • Page 143
    ...changes to Equity (Deficit) reflect our recapitalization, the elimination of Old GM's historical equity, the issuance of our common stock, preferred stock and warrants to the UST, Canada Holdings and MLC at fair value, and the application of fresh-start reporting. General Motors Company 2010 Annual...

  • Page 144
    ... Predecessor January 1, 2009 Through July 9, 2009 Change in net assets resulting from the application of fresh-start reporting ...Fair value of New GM's Series A Preferred Stock, common shares and warrants issued in 363 Sale ...Gain from the conversion of debt owed to UST to equity ...Gain from the...

  • Page 145
    ... consolidated group. Accordingly, the amounts presented will differ from those presented by GM Financial on a stand-alone basis. Change in Segments In the year ended December 31, 2010 we changed our managerial and financial reporting structure so that certain entities geographically located within...

  • Page 146
    ... to, and transactions with, affiliated entities (dollars in millions): Successor December 31, 2010 Total automotive assets (a) ...Total automotive liabilities (b) ... $1,322 $ 985 Successor Year Ended December 31, 2010 Total net sales and revenue ...Net income (loss) attributable to stockholders...

  • Page 147
    ...in bankruptcy, and accounts in repossession. 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. General Motors Company 2010 Annual Report 145

  • Page 148
    ... Inventory Automotive Inventories are stated at the lower of cost or market (LCM). In connection with fresh-start reporting, we elected to use the FIFO costing method for all inventories previously accounted for by Old GM using the LIFO costing method. 146 General Motors Company 2010 Annual Report

  • Page 149
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Market, which represents selling price less cost to sell, considers general market and economic conditions, periodic reviews of current profitability of vehicles, and the effect of current incentive offers...

  • Page 150
    ... reporting units are established using a discounted cash flow method. Our reporting units are GMNA, GME, GM Financial and various reporting units within the GMIO and GMSA segments. Due to the integrated nature of our manufacturing operations and the sharing of vehicle platforms among brands, assets...

  • Page 151
    ...Equity income, net of tax. Impairment charges related to cost method investments are recorded in Interest income and other non-operating income, net. Equipment on Operating Leases, net Equipment on operating leases, net, including leased vehicles within Total GM Financial Assets, is reported at cost...

  • Page 152
    ... cost of sales and GM Financial operating expenses and other. The following table summarizes the effects of foreign currency transactions (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 Predecessor January 1, 2009 Through Year Ended July 9, 2009...

  • Page 153
    ... to which the fair value has been below cost; (2) the financial condition and near-term prospects of the issuer; and (3) the intent to sell or likelihood to be forced to sell the security before any anticipated recovery. Prior to April 1, 2009 Old GM General Motors Company 2010 Annual Report 151

  • Page 154
    ...management control framework is utilized to monitor the strategies, risks and related hedge positions, in accordance with the policies and procedures approved by the Risk Management Committee. In August 2010 we changed our automotive operations risk management policy with respect to foreign exchange...

  • Page 155
    ...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 statements, using the statutory tax rates in effect for the year in which...

  • Page 156
    ...uncertain tax positions in Income tax expense (benefit). Old GM recorded interest income on uncertain tax positions in Interest income and other non-operating income, net, interest expense in Automotive interest expense and penalties in Automotive selling, general and administrative expense. Pension...

  • Page 157
    ... contract asset deficiency that must be funded by the defined benefit pension plan's sponsor. Group annuity contracts are generally classified in Level 3. Common and Preferred Stock Equity securities for which market quotations are readily available are valued at the last reported sale price or...

  • Page 158
    ...as liquidity, market activity, price level, credit ratings and geo-political risk in assessing the observability of inputs used by pricing services or dealers, which may affect classification. Investment Funds, Private Equity and Debt Investments and Real Estate Investments Exchange traded funds and...

  • Page 159
    ...postemployment benefits to hourly employees idled on an other than temporary basis were accrued based on our best estimate of the wage, benefit and other costs to be incurred, and costs related to the temporary idling of employees were expensed as incurred. General Motors Company 2010 Annual Report...

  • Page 160
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Stock Incentive Plans GM We measure and record compensation expense for all share-based payment awards based on the award's estimated fair value. We grant awards to our employees through the 2009 Long ...

  • Page 161
    ..., we consolidated General Motors Egypt (GM Egypt). Due to our application of fresh-start reporting on July 10, 2009 and because our investment in GM Egypt was accounted for using the equity method of accounting, there was no difference between the net assets added to the consolidated balance sheet...

  • Page 162
    ... paid to AmeriCredit common shareholders of $24.50 per share ...Cash paid to cancel outstanding stock warrants ...Cash paid to settle equity-based compensation awards ...Total consideration ...Acquisition-related costs (a) ...Assets acquired and liabilities assumed Cash ...Restricted cash ...Finance...

  • Page 163
    ... 6, 2009, the date of acquisition, to December 31, 2009, Nexteer reported revenue of $453 million, of which $218 million were sales to us. We did not provide the pro forma financial information because we do not believe the information is material. General Motors Company 2010 Annual Report 161

  • Page 164
    ... CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Acquisition of Strasbourg On October 1, 2010 we acquired 100% of the outstanding equity interest of General Motors Strasbourg S.A.S (GMS) for cash of one Euro from MLC. GMS is an entity engaged in the business of developing and manufacturing automatic...

  • Page 165
    ...We also agreed to continue all existing Delphi supply agreements and purchase orders for GMNA to the end of the related product program, and New Delphi agreed to provide us with access rights designed to allow us to operate specific sites on defined triggering events to provide us with protection of...

  • Page 166
    ... FINANCIAL STATEMENTS - (Continued) The following table summarizes the consideration provided under the DMDA and the allocation to its various elements based on their estimated fair values (dollars in millions): Successor October 6, 2009 Net cash paid ...Waived advance agreements, payment terms...

  • Page 167
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Nexteer and the four domestic facilities had revenue of $3.7 billion in the year ended December 31, 2008 of which 68% was related to sales to Old GM. Furthermore, through the terms of the MRA, we ...

  • Page 168
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) At December 31, 2010 the accrual of finance charge income has been suspended on delinquent finance receivables of $491 million. The following table summarizes purchase price premium (dollars in millions...

  • Page 169
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Credit Quality Credit bureau scores, generally referred to as FICO scores, are determined during GM Financial's automotive loan origination process. The following table summarizes the credit risk profile...

  • Page 170
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Note 8. Marketable Securities Automotive The following table summarizes information regarding marketable securities (dollars in millions): Successor December 31, 2010 December 31, 2009 Unrealized ...

  • Page 171
    ... vehicle sales to daily rental car companies and to retail customers. The following table summarizes information related to Equipment on operating leases, net and the related accumulated depreciation (dollars in millions): Successor December 31, 2010 December 31, 2009 Equipment on operating leases...

  • Page 172
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following table summarizes depreciation expense and impairment charges related to Equipment on operating leases, net (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010...

  • Page 173
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) JV), collectively referred to as the China JVs. Sales and income of these joint ventures are not consolidated into our financial statements; rather, our proportionate share of the earnings of each joint ...

  • Page 174
    ...,510 $ 1,078 Year Ended December 31, 2010 (a) Year Ended December 31, 2009 (b) Year Ended December 31, 2008 Summarized Operating Data China JV's net sales ...Others' net sales ...Total net sales ...China JV's net income ...Others' net income ...Total net income ... $25,395 17,500 $42,895 $ 2,808...

  • Page 175
    ..., net ...Accounts payable (principally trade) ...Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 $1,618 $ 641 $771 $579 Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Cash Flows Operating ...Investing ...Financing ...Investment in...

  • Page 176
    ... exchange, Old GM's ownership was reduced to 24.5% of Ally Financial's Common Membership Interests. Ally Financial converted its status to a C corporation effective June 30, 2009. At that date, Old GM began to account for its investment in Ally Financial using the cost method rather than the equity...

  • Page 177
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) June 30, 2009 Condensed Consolidated Balance Sheet Loans held for sale ...Total finance receivables and loans, net ...Investment in operating leases, net ...Other assets ...Total assets ...Total debt ...

  • Page 178
    ... related to Property, net, recorded in Automotive cost of sales, Automotive selling, general and administrative expense and Other automotive expenses, net (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 Predecessor January 1, 2009 Through Year...

  • Page 179
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Old GM initiated restructuring plans prior to the 363 Sale to reduce the total number of powertrain, stamping and assembly plants and to eliminate certain brands and nameplates. In addition, MLC retained...

  • Page 180
    ...of fresh-start reporting. If all identifiable assets and liabilities had been recorded at fair value upon application of fresh-start reporting, no goodwill would have resulted. However, when applying freshstart reporting, certain accounts, primarily employee benefit plan and income tax related, were...

  • Page 181
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following table summarizes the amortization expense related to intangible assets (dollars in millions): Successor Year Ended December 31, 2010 July 10, 2009 Through December 31, 2009 (a) Predecessor ...

  • Page 182
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) (a) In April 2010 the UST Loans and Canadian Loan were paid in full and funds remaining in escrow were no longer subject to restrictions. (b) Under the terms of an escrow agreement between GMCL, the EDC ...

  • Page 183
    ... that manufacture, market and sell vehicles in certain markets; (4) leasing SPEs which held real estate assets and related liabilities for which Old GM provided residual guarantees; and (5) an entity which manages certain private equity investments held by our and Old GM's defined benefit plans...

  • Page 184
    ... December 31, 2009 (a) 2008 (a) Year Ended December 31, 2010 (a)(b) Total net sales and revenue ...Automotive cost of sales ...Automotive selling, general administrative expense ...Other automotive expenses, net ...Automotive interest expense ...Interest income and other non-operating income, net...

  • Page 185
    ... or Old GM provided guarantees or financial support; (2) vehicle sales and marketing joint ventures that manufacture, market and sell vehicles and related services; (3) leasing entities for which residual value guarantees were made; (4) certain research entities for which annual ongoing funding...

  • Page 186
    ... VIEs are operating joint ventures located in developing international markets. American Axle In September 2009 we paid $110 million to American Axle, a former subsidiary and current supplier, to settle and modify existing commercial arrangements and acquire warrants to purchase 4 million shares of...

  • Page 187
    ...CONSOLIDATED FINANCIAL STATEMENTS - (Continued) exposure of $100 million related to the second lien term loan facility. In February 2011 we exercised the warrants and sold the shares and received proceeds of $48 million. Ally Financial We own 9.9% of Ally Financial's common stock and preferred stock...

  • Page 188
    ... liabilities and deferred income taxes: Successor December 31, 2010 December 31, 2009 Current Dealer and customer allowances, claims and discounts ...Deposits from rental car companies ...Deferred revenue ...Policy, product warranty and recall campaigns ...Payrolls and employee benefits excluding...

  • Page 189
    ... in each agreement. Amounts paid and expensed for these commitment fees during the years ended December 31, 2010 and 2009 were insignificant. (c) Includes zero coupon debt. (d) Includes coupon rates on debt denominated in various foreign currencies. General Motors Company 2010 Annual Report 187

  • Page 190
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following table summarizes the components of automotive long-term debt (dollars in millions): Successor December 31, 2010 December 31, 2009 VEBA Notes ...Other long-term debt ...Total debt ...Less ...

  • Page 191
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) ability to secure up to $2.0 billion of certain non-loan obligations that we may designate from time to time as additional pari passu first lien obligations. Second-lien debt is generally allowed but ...

  • Page 192
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) March 2010 and December 2009 we made quarterly payments of $1.0 billion on the UST Loans. In April 2010 we repaid the full outstanding amount of $4.7 billion using funds from our escrow account. While we...

  • Page 193
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following table summarizes interest expense and interest paid on the Canadian Loan and the EDC Loan Facility (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 (a) ...

  • Page 194
    ... ratios including portfolio net loss and delinquency ratios, and pool level cumulative net loss ratios, as well as limits on deferment levels. Failure to meet any of these covenants could result in an event of default under these agreements. If an 192 General Motors Company 2010 Annual Report

  • Page 195
    ... pledged to support the transaction to increase until a specified level is attained. Excess cash flows generated by the trusts are added to the restricted cash account or used to pay down outstanding debt in the trusts, creating overcollateralization until the targeted percentage level of assets has...

  • Page 196
    .... During the three months ended December 31, 2010 GM Financial repurchased convertible senior notes of $461 million and senior notes of $2 million. Long-Term Debt Maturities Consolidated The following table summarizes long-term debt maturities including capital leases (dollars in millions): At...

  • Page 197
    ...years of service before normal retirement age. Non-skilled trades hourly U.S. employees hired after October 15, 2007 participate in a defined benefit cash balance plan. In September 2010 the U.S. hourly defined benefit pension plan was amended to create a legally separate new defined benefit pension...

  • Page 198
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) the S-SPP in October 2009. The contribution equal to 1.0% of eligible base salary for U.S. salaried employees with a service commencement date on or after January 1, 1993 was discontinued effective on ...

  • Page 199
    ... benefit cost and benefit payments. Excludes effect of asset returns that are higher or lower than expected. (b) Reflects the effect on PBO. There was no remeasurement. (c) Includes reclassification of contingent liability to benefit plan obligation. General Motors Company 2010 Annual Report...

  • Page 200
    ...retiree healthcare to the new plan funded by the New VEBA. Under the terms of the settlement agreement, we are released from UAW retiree healthcare claims incurred after December 31, 2009. All obligations of ours and any other entity or benefit plan of 198 General Motors Company 2010 Annual Report

  • Page 201
    ...introducing co-payments for healthcare benefits, increasing employee healthcare cost sharing, freezing pension benefits and eliminating cost of living adjustments to pensions for retired hourly workers. The 2009 CAW Agreement was conditioned on Old GM receiving longer term financial support from the...

  • Page 202
    ... accounting recognition for the healthcare trust at December 31, 2010. The following tables summarize the change in benefit obligations and related plan assets (dollars in millions): Successor Year Ended December 31, 2010 Non-U.S. Plans U.S. Plans Pension Benefits Other Benefits U.S. Plans Pension...

  • Page 203
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Successor July 10, 2009 Through December 31, 2009 U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans Pension Benefits Pension Benefits Other Benefits Other Benefits Change in benefit obligations ...

  • Page 204
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Predecessor January 1, 2009 Through July 9, 2009 U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans Pension Benefits Pension Benefits Other Benefits Other Benefits Change in benefit obligations ...

  • Page 205
    ...the effect of the improvement in the financial markets will not be fully reflected in net pension expense in the year ending December 31, 2011. Refer to Note 4 for additional information on our use of the market-related value of plan assets accounting policy. The following table summarizes the total...

  • Page 206
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Successor July 10, 2009 Through December 31, 2009 U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans Pension Benefits Pension Benefits Other Benefits Other Benefits Components of expense Service cost ...

  • Page 207
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Predecessor U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans Pension Benefits Pension Benefits Other Benefits Other Benefits January 1, 2009 January 1, 2009 January 1, 2009 January 1, 2009 Through Year Ended...

  • Page 208
    ...to changes in the healthcare cost trend rate. Investment Strategies and Long-Term Rate of Return Detailed periodic studies conducted by outside actuaries and an internal asset management group, consisting of an analysis of capital market assumptions and employing Monte-Carlo simulations, are used to...

  • Page 209
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) In setting a new strategic asset mix, consideration is given to the likelihood that the selected mix will effectively fund the projected pension plan liabilities, while aligning with the risk tolerance ...

  • Page 210
    ... funds. (d) Refer to the subsequent discussion of Investment Trusts for the leveling of the underlying assets of the Investment Trusts. (e) Cash held by the plans, net of amounts payable for investment manager fees, custody fees and other expenses. 208 General Motors Company 2010 Annual Report

  • Page 211
    ... 2009 Total Non-U.S. Plan Assets Total U.S. and NonU.S. Plan Assets Level 1 Level 2 Level 3 Total U.S. Plan Assets Level 1 Level 2 Level 3 Assets Direct investments Cash equivalents and other short-term investments ...$ - Common and preferred stocks ...- Government and agency debt securities...

  • Page 212
    ... than assets held in Investment Trusts (dollars in millions): Successor Year Ended December 31, 2010 Purchases, Net Unrealized Net Realized Sales and Gains (Losses) Gains (Losses) Settlements Transfers into (out of) Level 3 Balance at December 31, 2010 Balance at January 1, 2010 Fixed income funds...

  • Page 213
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following tables summarize the activity for non-U.S. plan assets classified in Level 3 (dollars in millions): Successor Year Ended December 31, 2010 Net Purchases, Transfers Realized Sales and into (...

  • Page 214
    ... transfers in and/or out of Level 3 within the non-U.S. plan assets. Fund Investment Strategies Cash equivalent funds asset class includes funds that primarily invest in short-term, high quality securities including U.S. government securities, U.S. dollar-denominated obligations of U.S. and foreign...

  • Page 215
    ..., development, financing, 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. Other investment funds generally consist...

  • Page 216
    ... accounts owned by the Investment Trusts (dollars in millions): Successor Fair Value Measurements of Investment Trust Underlying Assets at December 31, 2010 (a) Level 1 Level 2 Level 3 Total Assets Cash equivalents and other short-term investments ...Common and preferred stocks ...Government...

  • Page 217
    ... TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Successor Fair Value Measurements of Investment Trust Underlying Assets at December 31, 2009 (a) Level 1 Level 2 Level 3 Total Assets Cash equivalents and other short-term investments ...Common and preferred stocks ...Government and agency debt...

  • Page 218
    ... income funds ...Funds of hedge funds ...Global macro funds ...Multi-strategy funds ...Other investment funds ...Private equity and debt investments ...Real estate assets ...Total assets ...Liabilities Common and preferred stocks ...Debt securities ...Total liabilities ...Derivatives, net ...Total...

  • Page 219
    ...Equity funds ...Fixed income funds ...Funds of hedge funds ...Global macro funds ...Multi-strategy funds ...Other investment funds ...Private equity and debt investments ...Real estate assets ...Total assets ...Liabilities Common and preferred stocks ...Total liabilities ...Derivatives, net ...Total...

  • Page 220
    ...dollars in millions): Successor Fair Value Measurements at December 31, 2009 Total U.S. Level 1 Level 2 Level 3 Plan Assets Direct investments Cash equivalents and other short-term investments ...Investment Funds - Mutual and commingled funds ...Other ...Total assets ...Employee-owned assets ...Net...

  • Page 221
    ... held in the Investment Trusts 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 basis and has procedures in place that are designed...

  • Page 222
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) to interest rates on long-term debt securities and foreign currency exchange rate fluctuations. The risk of default can be influenced by various factors including macro-economic conditions, market liquidity...

  • Page 223
    ... net benefit payments expected to be paid in the future, which include assumptions related to estimated future employee service, but does not reflect the effect of the 2009 CAW Agreement which provides for our independent HCT (dollars in millions): Successor Years Ended December 31, Pension Benefits...

  • Page 224
    ... portion recorded in Other current assets and deferred income taxes (b) Non-current portion recorded in Other assets. (c) Current portion recorded in Accrued liabilities. (d) Non-current portion recorded in Other liabilities and deferred income taxes. 222 General Motors Company 2010 Annual Report

  • Page 225
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Gains and (Losses) on Derivatives The following table summarizes derivative gains and (losses) recorded in earnings (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 ...

  • Page 226
    ...comprehensive income (loss). In the years ended December 31, 2010 and 2009 we recorded cash flow hedge losses of $22 million and $1 million related to our share of New Delphi's hedging losses. Automotive Financing GM Financial is exposed to market risks arising from adverse changes in interest rates...

  • Page 227
    ... per share. Old GM recorded the warrants as a liability and recorded gains and losses related to this derivative in Interest income and other non-operating income, net. In connection with the 363 Sale, the UST returned the warrants and they were cancelled. General Motors Company 2010 Annual Report...

  • Page 228
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Cash Flow Hedges Old GM previously designated certain financial instruments as cash flow hedges to manage its exposure to certain foreign currency exchange risks. For foreign currency transactions, Old ...

  • Page 229
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Net Change in Accumulated Other Comprehensive Income (Loss) The following table summarizes the net change in Accumulated other comprehensive income (loss) related to cash flow hedging activities (dollars...

  • Page 230
    ... comprehensive income (loss) (dollars in millions): Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Effective portion of net investment hedges ...Derivatives Not Meeting a Scope Exception from Fair Value Accounting $5 $106 Old GM previously entered into purchase...

  • Page 231
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) (a) At December 31, 2010 and 2009 qualified cardholders had rebates available, net of deferred program revenue, of $2.8 billion and $3.1 billion. (b) Redemption liabilities are recorded in Accrued liabilities...

  • Page 232
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Credit Card Programs Credit card programs offer rebates that can be applied primarily against the purchase or lease of our vehicles. Environmental Liability In connection with the 363 Sale, we acquired ...

  • Page 233
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Liability Related to Contingently Issuable Shares We are obligated to issue Adjustment Shares of our common stock to MLC in the event that allowed general unsecured claims against MLC, as estimated by ...

  • Page 234
    ... related to asset retirement obligations (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 December 31, 2009 Predecessor January 1, 2009 Through July 9, 2009 Beginning balance ...Accretion expense ...Liabilities incurred ...Liabilities settled or disposed ...Effect...

  • Page 235
    ... whereby, under certain conditions, Old GM would make payments for certain pension and OPEB benefits to certain former U.S. hourly employees that became employees of Delphi. The Delphi Benefit Guarantee Agreements provided, in general, that in the General Motors Company 2010 Annual Report 233

  • Page 236
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) event that Delphi or its successor companies ceased doing business, terminated its pension plan or ceased to provide credited service or OPEB benefits at certain levels due to financial distress, Old GM ...

  • Page 237
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) • Production cash burn support - Reimburse Delphi's cash flow deficiency attributable to production at certain U.S. facilities that continue to produce systems, components and parts for GM vehicles ...

  • Page 238
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Payment Terms Acceleration Agreement In October 2008 subject to Delphi obtaining an extension or other accommodation of its DIP financing through June 30, 2009, Old GM agreed to temporarily accelerate ...

  • Page 239
    ...who returned to Old GM and became participants in the UAW hourly medical plan primarily in 2006. Such benefit is included in the actuarial gain recorded in our UAW hourly medical plan. Refer to Note 22 for additional information on the Delphi benefit plans. General Motors Company 2010 Annual Report...

  • Page 240
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Note 23. Income Taxes Consolidated The following table summarizes Income (loss) before income taxes and equity income (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010 ...

  • Page 241
    ... rise to deferred tax assets (liabilities) (dollars in millions): Successor December 31, 2010 December 31, 2009 Deferred tax assets Postretirement benefits other than pensions ...Pension and other employee benefit plans ...Warranties, dealer and customer allowances, claims and discounts ...Property...

  • Page 242
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The following table summarizes deferred tax assets (liabilities) (dollars in millions): Successor December 31, 2010 December 31, 2009 Current deferred tax assets ...Current deferred tax liabilities ......

  • Page 243
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) In July 2009 Old GM recorded adjustments resulting in a net decrease in valuation allowances of $20.7 billion as a result of the 363 Sale and fresh-start reporting. The net decrease primarily resulted ...

  • Page 244
    ... (dollars in millions): Successor December 31, 2010 December 31, 2009 Gross unrecognized tax benefits before valuation allowances ...Amount that would favorably affect effective tax rate in future ...Amount of liability for uncertain tax positions benefits netted against deferred tax assets in...

  • Page 245
    ... by the Internal Revenue Service (IRS), and the review was concluded in February 2010. The IRS is currently auditing Old GM's federal 2007 and 2008 tax years. The IRS is also reviewing the January 1 through July 9, 2009 Old GM tax year as part of the IRS Compliance Assurance Process (CAP), the...

  • Page 246
    ... 31, 2010 Level 1 Level 2 Level 3 Total Assets Cash equivalents (a) United States government and agency ...Sovereign debt ...Certificates of deposit ...Money market funds ...Commercial paper ...Marketable securities Trading securities Equity ...Debt ...Available-for-sale securities United States...

  • Page 247
    ... 31, 2009 Level 1 Level 2 Level 3 Total Assets Cash equivalents (a) United States government and agency ...Certificates of deposit ...Money market funds ...Commercial paper ...Marketable securities Trading securities Equity ...Debt ...Available-for-sale securities United States government and...

  • Page 248
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) For periods presented from June 1, 2009 through September 30, 2010 nonperformance risk for us and Old GM was not observable through a liquid credit default swap market as a result of the Chapter 11 ...

  • Page 249
    ...discounted cash flow model which used benchmark yield curves plus a spread that represented the yields on traded bonds of companies with comparable credit ratings and risk profiles. The following table summarizes the carrying amount and estimated fair values of short-term and long-term debt (dollars...

  • Page 250
    ... challenges in the housing markets and mortgage industry, and its need for additional liquidity to maintain business operations. At December 31, 2010 and 2009 we calculated the fair value of our investment in Ally Financial's preferred stock using a discounted cash flow approach. The present value...

  • Page 251
    ... notes and convertible senior notes are based on quoted market prices, when available. If quoted market prices are not available, the fair value is estimated by discounting future net cash flows expected to be settled using a current risk-adjusted rate. General Motors Company 2010 Annual Report 249

  • Page 252
    ... 20 for pension and other postretirement benefit charges resulting from our hourly and salaried employee separation initiatives, including special attrition programs. GM Financial did not execute any new restructuring initiatives in the three months ended December 31, 2010. Charges and payments for...

  • Page 253
    ... programs described above. We expect to incur an additional $0.6 billion primarily in 2011 and 2012 to complete these programs. Because these programs involve voluntary separations, no liabilities are recorded until offers to employees are accepted. General Motors Company 2010 Annual Report...

  • Page 254
    ... reserves related to dealer wind-down agreements in the period July 10, 2009 through December 31, 2009 and in the year ended December 31, 2010 (dollars in millions): Successor Canada and Mexico U.S. Total Balance at July 10, 2009 ...Additions ...Payments ...Transfer to legal reserve ...Effect of...

  • Page 255
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Old GM GMNA recorded charges, interest accretion and other, and revisions to estimates of $1.5 billion in the period January 1, 2009 through July 9, 2009 for separation programs related to the following ...

  • Page 256
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) GMIO recorded charges, interest accretion and other, and revisions to estimates of $96 million in the year ended December 31, 2008 primarily related to separation charges of $76 million related to a ...

  • Page 257
    ...residual support and risk sharing reserves of $220 million recorded as a reduction of revenue in GMNA. (b) Refer to Note 8 and Note 24 for additional information on marketable securities and financial instruments measured at fair value on a recurring basis. General Motors Company 2010 Annual Report...

  • Page 258
    ... MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Fair value measurements, excluding vehicles leased to rental car companies and automotive retail leases, utilized projected cash flows discounted at a rate commensurate with the perceived business risks related...

  • Page 259
    ...2) (Level 3) Period Ended July 9, 2009 (a) January 1, 2009 Through July 9, 2009 Total Losses Product-specific tooling assets (b) ...Cancelled powertrain programs ...Other long-lived assets ...Equity and cost method investments (other than Ally Financial) ...Vehicles leased to rental car companies...

  • Page 260
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Note 27. Other Automotive Expenses, net The following table summarizes the components of Other automotive expenses, net (dollars in millions): Successor July 10, 2009 Year Ended Through December 31, 2010...

  • Page 261
    ...in part, for cash at a price per share equal to the $25.00 per share liquidation amount, plus any accrued and unpaid dividends. The Series A Preferred Stock was originally classified as temporary equity because the holders of Series A Preferred Stock, as a class, owned greater than 50% of our common...

  • Page 262
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) our common stock. The number of shares of our common stock issuable upon conversion of each share of Series B Preferred Stock on the mandatory conversion date, is determined based on the applicable ...

  • Page 263
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) at an exercise price of $42.31 per share. The number of shares of common stock underlying each of the warrants and the per share exercise price thereof are subject to adjustment as a result of certain ...

  • Page 264
    ... income (loss) attributable to common stockholders (dollars in millions): Year Ended December 31, 2010 Pre-tax Tax Expense Net Amount (Benefit) Amount Successor July 10, 2009 Through December 31, 2009 Pre-tax Tax Expense Net Amount (Benefit) Amount Foreign currency translation gain ...Cash flow...

  • Page 265
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Predecessor January 1, 2009 Through Year Ended July 9, 2009 December 31, 2008 Tax Tax Pre-tax Expense Net Pre-tax Expense Net Amount (Benefit) Amount Amount (Benefit) Amount Foreign currency translation...

  • Page 266
    ... public offering, we used the New York Stock Exchange price. In the year ended December 31, 2010 because the market value of our common stock was within the price range of $33.00 to $39.60 per common share no undistributed earnings were allocated to our Series B Preferred Stock under the two-class...

  • Page 267
    ... effect of the assumed exercise of certain stock options. Old GM excluded 208 million of stock options and warrants in the computation of diluted earnings per share because the exercise price was greater than the average market price of the common shares. Due to Old GM's net losses in the year ended...

  • Page 268
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Long-Term Incentive Plan In 2010 we granted RSUs to certain global executives under the 2009 GMLTIP. We granted 15 million RSUs valued at the grant date fair value of our common stock in the year ended ...

  • Page 269
    ... Year Ended July 9, 2009 December 31, 2008 Compensation expense (benefit) ...Income tax expense (benefit) (a) ... $(10) $- $(65) $ 3 (a) Income tax expense (benefit) does not include U.S. and non-U.S. jurisdictions which have full valuation allowances. General Motors Company 2010 Annual Report...

  • Page 270
    ... lease residual programs. Excludes payments to Ally Financial related to the contractual exposure limit, as subsequently discussed. Marketing Incentives and Operating Lease Residuals As a marketing incentive, interest rate support, residual support, risk sharing, capitalized cost reduction and lease...

  • Page 271
    ... Financing Agreement) with an effective date of December 29, 2008. The terms of the Amended Financing Agreement included conditions of interest rate support, residual support, risk sharing, capitalized cost reduction, and lease pull-ahead programs. Exclusivity Arrangement In November 2006 Old GM...

  • Page 272
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Beginning in 2009 under the Amended Financing Agreement, Old GM agreed to pro-rate the exclusivity fee in the U.S. and Canada under certain circumstances if incentives were offered through a third party ...

  • Page 273
    ... effects of transactions with Ally Financial (dollars in millions): Successor December 31, December 31, 2010 2009 Assets Accounts and notes receivable, net (a) ...Restricted cash and marketable securities (b) ...Other assets (c) ...Liabilities Accounts payable (d) ...Short-term debt and current...

  • Page 274
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Statement of Operations The following table summarizes the income statement effects of transactions with Ally Financial (dollars in millions): Successor Year Ended July 10, 2009 December 31, Through 2010...

  • Page 275
    ... 31, 2010 2009 Accounts and notes receivable, net (a) ...Other assets ...Accounts payable (a) ...Accrued liabilities ...(a) Primarily related to the purchase and sale of component parts. Cash Flow The following table summarizes the cash flow effects of transactions with MLC (dollars in millions...

  • Page 276
    ... acquisition of GM Financial including net income of $10 million related to amounts recorded to reflect the changes in the valuation allowance on deferred tax assets that were not applicable to GM Financial on a stand-alone basis. • • • • 274 General Motors Company 2010 Annual Report

  • Page 277
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Results for the three months ended September 30, 2010 included: • Restructuring charges and interest accretion and other of $153 million in GME primarily related to separation programs announced in ...

  • Page 278
    ..., vehicle accessories and extended service warranties. GMNA primarily meets the demands of customers in North America with vehicles developed, manufactured and/or marketed under the following four brands: • Buick • Cadillac • Chevrolet • GMC 276 General Motors Company 2010 Annual Report

  • Page 279
    ..., certain nonsegment specific revenues and expenses, including costs related to the Delphi Benefit Guarantee Agreements and a portfolio of automotive retail leases. All intersegment balances and transactions have been eliminated in consolidation. General Motors Company 2010 Annual Report 277

  • Page 280
    ... the valuation allowance on deferred tax assets that were not applicable to GM Financial on a stand-alone basis. (b) Amounts exclude changes related to income tax expense (benefit) in jurisdictions with a full valuation allowance throughout the period. 278 General Motors Company 2010 Annual Report

  • Page 281
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Successor GMNA GME GMIO GMSA Corporate Eliminations Total Automotive At and For the Period July 10, 2009 Through December 31, 2009 Sales External customers ...Intersegment ...Other revenue ...Total net ...

  • Page 282
    GENERAL MOTORS COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Predecessor GMNA GME GMIO GMSA Corporate Eliminations Total Automotive For the Period January 1, 2009 Through July 9, 2009 Sales External customers ...Intersegment ...Other revenue ...Total net sales ...

  • Page 283
    ...$ 7,099 1,001 759 119 62 610 1,010 (4,901) 1,704 340 1,450 $ (1,746) $ 1,175 $ 94 $ 8 $ - $ 9,253 (a) Amounts exclude changes related to income tax expense (benefit) in jurisdictions with a full valuation allowance throughout the period. General Motors Company 2010 Annual Report 281

  • Page 284
    ... the Through Year Ended July 9, 2009 December 31, 2008 Net Long Net Long Sales & Lived Sales & Lived Revenue Assets Revenue Assets North America U.S...Canada and Mexico ...GM Financial U.S...Canada ...Europe France ...Germany ...Italy ...Spain ...United Kingdom ...Other European Countries ...Asia...

  • Page 285
    ... Year Ended July 9, 2009 December 31, 2008 Accounts receivable ...Prepaid expenses and other deferred charges ...Inventories ...Accounts payable ...Income taxes payable ...Accrued liabilities and other liabilities ...Fleet rental - acquisitions ...Fleet rental - liquidations ...Total ...Cash paid...

  • Page 286
    .... Based upon the actions taken and our testing and evaluation of the effectiveness of our internal controls, we have concluded the material weakness related to controls over the period-end financial reporting process no longer existed as of December 31, 2010. 284 General Motors Company 2010 Annual...

  • Page 287
    ... of the financial reporting process, therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk s/ CHRISTOPHER P. LIDDELL Christopher P. Liddell Vice Chairman and Chief Financial Officer March 1, 2011 General Motors Company 2010 Annual Report 285

  • Page 288
    ... ACCOUNTS (Dollars in millions) Additions Charged to Costs and Expenses Additions Charged to Other Accounts Effect of Application of FreshStart Reporting Description Balance at Beginning of Period Deductions Balance at End of Period Successor For the year ended December 31, 2010 Allowances...

  • Page 289
    ... on the Internet Learn more about the new General Motors vehicles and services on our website at www.gm.com. GM Customer assistance Centers To request product information or to receive assistance with your vehicle, please contact the appropriate marketing unit: Buick: 800-521-7300 Cadillac: 800-458...

  • Page 290
    General Motors Company 300 Renaissance Center P.O. Box 300 Detroit, MI 48265-3000 www.gm.com