General Motors 2015 Annual Report Download - page 20

Table of Contents
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or systems, including in-vehicle systems and mobile devices, or service failures could have a material adverse effect on our business and results of operations,
due to, among other things, the loss of proprietary data, interruptions or delays in our business operations and damage to our reputation. In addition any such
access, disclosure or other loss of information could result in legal claims or proceedings, liability or regulatory penalties under laws protecting the privacy of
personal information, disrupt operations and reduce the competitive advantage we hope to derive from our investment in advanced technologies. Our
insurance coverage may not be adequate to cover all the costs related to significant security attacks or disruptions resulting from such attacks.

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
We rely on GM Financial in North America, Europe, South America and China to support leasing and sales of our vehicles to consumers requiring vehicle
financing and also to provide commercial lending to our dealers. Any reduction of GM Financial's ability to provide such financial services would negatively
affect our efforts to support additional sales of our vehicles and expand our market penetration among consumers and dealers.
As an entity operating in the financial services sector, GM Financial is required to comply with a wide variety of laws and regulations that may be costly to
adhere to and may affect our consolidated operating results. Compliance with these laws and regulations requires that GM Financial maintain forms,
processes, procedures, controls and the infrastructure to support these requirements and these laws and regulations often create operational constraints both
on GM Financial’s ability to implement servicing procedures and on pricing. Laws in the financial services industry are designed primarily for the protection
of consumers. The failure to comply with these laws could result in significant statutory civil and criminal penalties, monetary damages, attorneys’ fees and
costs, possible revocation of licenses and damage to reputation, brand and valued customer relationships.
The primary factors that could adversely affect GM Financial's business and operations and reduce its ability to provide financing services at competitive
rates include:
• The availability of borrowings under its credit facilities to fund its retail and dealer finance activities;
• Its ability to access a variety of financing sources including the asset-backed securities market and other secured and unsecured debt markets;
• The performance of loans and leases in its portfolio, which could be materially affected by delinquencies, defaults or prepayments;
• Wholesale auction values of used vehicles;
• Higher than expected vehicle return rates and the residual value performance on vehicles GM Financial leases to customers;
• Fluctuations in interest rates and currencies; and
• Changes to regulation, supervision and licensing across various jurisdictions, including new regulations or sanctions imposed in the U.S. by the
Department of Justice, SEC and Consumer Financial Protection Bureau.
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Our employee benefit plans currently hold a significant amount of equity and fixed income securities. A detailed description of the investment funds and
strategies is disclosed in Note 13 to our consolidated financial statements, which also describes significant concentrations of risk to the plan investments.
There are additional risks due to the complexity and magnitude of our investments. Examples include implementation of significant changes in investment
policy, insufficient market liquidity in particular asset classes and the inability to quickly rebalance illiquid and long-term investments.
Our future funding requirements for our U.S. defined benefit pension plans depend upon the future performance of assets placed in trusts for these plans, the
level of interest rates used to determine funding levels, the level of benefits provided for by the plans
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