General Motors 2010 Annual Report Download - page 254

GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
GMNA recorded charges, interest accretion and other, and revisions to estimates of $89 million in the period July 10, 2009 through
December 31, 2009 for separation programs primarily related to the following initiatives:
• The restructuring reserves were increased by $213 million due to an increase in the SUB and TSP accrual of $183 million
related to capacity actions, productivity initiatives, acquisition of Nexteer and four domestic facilities and Canadian
restructuring activities of $30 million.
• The salaried and hourly workforce severance accruals were reduced by $146 million as a result of elections subsequently made
by terminating employees. Such amounts were reclassified as special termination benefits and were funded from the U.S.
defined benefit pension plans and other applicable retirement benefit plans.
GME recorded charges, interest accretion and other, and revisions to estimates of $72 million in the period July 10, 2009 through
December 31, 2009 primarily related to separation charges for early retirement programs and additional liability adjustments,
primarily in Germany.
GMIO recorded charges, interest accretion and other, and revisions to estimates of $77 million in the period July 10, 2009 through
December 31, 2009, primarily related to separation charges of $72 million related to restructuring programs in Australia for salaried
and hourly employees.
Dealer Wind-downs
We market vehicles worldwide through a network of independent retail dealers and distributors. As part of achieving and sustaining
long-term viability and the viability of our dealer network, we determined that a reduction in the number of GMNA dealerships was
necessary. At December 31, 2010 there were 5,200 dealers in GMNA compared to 6,500 at December 31, 2009. Certain dealers in the
U.S. that had signed wind-down agreements with us elected to file for reinstatement through a binding arbitration process. At
December 31, 2010 the arbitration process had been resolved. As a result of the arbitration process we offered 332 dealers
reinstatement in their entirety and 460 existing dealers reinstatement of certain brands.
The following table summarizes GMNA’s restructuring 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
U.S. Canada and Mexico Total
Balance at July 10, 2009 ........................................................... $398 $118 $516
Additions ....................................................................... 229 46 275
Payments ....................................................................... (167) (118) (285)
Transfer to legal reserve ........................................................... — (17) (17)
Effect of foreign currency .......................................................... — 12 12
Balance at December 31, 2009 ...................................................... 460 41 501
Revisions to estimates ............................................................. (2) 9 7
Payments ....................................................................... (323) (43) (366)
Effect of foreign currency .......................................................... — 2 2
Balance at December 31, 2010 ...................................................... $135 $ 9 $144
Restructuring reserves related to dealer wind-down agreements in the period July 10, 2009 through December 31, 2009 increased
primarily due to additional accruals recorded for wind-down payments to Saturn dealerships in accordance with the deferred
termination agreements that Saturn dealers signed.
252 General Motors Company 2010 Annual Report