GENERAL MOTORS COMPANY Basis of Presentation This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with the accompanying condensed consolidated financial statements and the notes thereto, and the audited consolidated financial statements and notes thereto included in our 2021 Form 10-K. Forward -looking statements in this MD&A are not guarantees of future performance and may involve risks and uncertainties that could cause actual results to differ materially from those projected. Refer to the "Forward-Looking Statements" section of this MD&A and Part 1, Item 1A. Risk Factors of our 2021 Form 10-K for a discussion of these risks and uncertainties. Except for per share amounts or as otherwise specified, dollar amounts presented within tables are stated in millions. Certain columns and rows may not add due to rounding. Non-GAAP Measures Our non-GAAP measures include: EBIT-adjusted, presented net of noncontrolling interests; EBT-adjusted for our GM Financial segment; EPS-diluted-adjusted; effective tax rate-adjusted (ETR-adjusted); return on invested capital-adjusted (ROIC-adjusted) and adjusted automotive free cash flow. Our calculation of these non-GAAP measures may not be comparable to similarly titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the use of these non-GAAP measures has limitations and should not be considered superior to, in isolation from, or as a substitute for, relatedU.S. GAAP measures. These non-GAAP measures allow management and investors to view operating trends, perform analytical comparisons and benchmark performance between periods and among geographic regions to understand operating performance without regard to items we do not consider a component of our core operating performance. Furthermore, these non-GAAP measures allow investors the opportunity to measure and monitor our performance against our externally communicated targets and evaluate the investment decisions being made by management to improve ROIC-adjusted. Management uses these measures in its financial, investment and operational decision-making processes, for internal reporting and as part of its forecasting and budgeting processes. Further, our Board of Directors uses certain of these and other measures as key metrics to determine management performance under our performance-based compensation plans. For these reasons, we believe these non-GAAP measures are useful for our investors. EBIT-adjusted EBIT-adjusted is presented net of noncontrolling interests and is used by management and can be used by investors to review our consolidated operating results because it excludes automotive interest income, automotive interest expense and income taxes as well as certain additional adjustments that are not considered part of our core operations. Examples of adjustments to EBIT include, but are not limited to, impairment charges on long-lived assets and other exit costs resulting from strategic shifts in our operations or discrete market and business conditions; costs arising from legal matters; and certain currency devaluations associated with hyperinflationary economies. For EBIT-adjusted and our other non-GAAP measures, once we have made an adjustment in the current period for an item, we will also adjust the related non-GAAP measure in any future periods in which there is an impact from the item. Our corresponding measure for our GM Financial segment is EBT-adjusted because interest income and interest expense are part of operating results when assessing and measuring the operational and financial performance of the segment. EPS-diluted-adjusted EPS-diluted-adjusted is used by management and can be used by investors to review our consolidated diluted EPS results on a consistent basis. EPS-diluted-adjusted is calculated as net income attributable to common stockholders-diluted less adjustments noted above for EBIT-adjusted and certain income tax adjustments divided by weighted-average common shares outstanding-diluted. Examples of income tax adjustments include the establishment or reversal of significant deferred tax asset valuation allowances. ETR-adjusted ETR-adjusted is used by management and can be used by investors to review the consolidated effective tax rate for our core operations on a consistent basis. ETR-adjusted is calculated as Income tax expense less the income tax related to the adjustments noted above for EBIT-adjusted and the income tax adjustments noted above for EPS-diluted-adjusted divided by Income before income taxes less adjustments. When we provide an expected adjusted effective tax rate, we do not provide an expected effective tax rate because theU.S. GAAP measure may include significant adjustments that are difficult to predict. ROIC-adjusted ROIC-adjusted is used by management and can be used by investors to review our investment and capital allocation decisions. We define ROIC-adjusted as EBIT-adjusted for the trailing four quarters divided by ROIC-adjusted average net assets, which is considered to be the average equity balances adjusted for average automotive debt and interest liabilities, exclusive of finance leases; average automotive net pension and OPEB liabilities; and average automotive net income tax assets during the same period. 24
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Adjusted automotive free cash flow Adjusted automotive free cash flow is used by
management and can be used by investors to review the liquidity of our
automotive operations and to measure and monitor our performance against our
capital allocation program and evaluate our automotive liquidity against the
substantial cash requirements of our automotive operations. We measure adjusted
automotive free cash flow as automotive operating cash flow from operations less
capital expenditures adjusted for management actions. Management actions can
include voluntary events such as discretionary contributions to employee benefit
plans or nonrecurring specific events such as a closure of a facility that are
considered special for EBIT-adjusted purposes. Refer to the "Liquidity and
Capital Resources" section of this MD&A for additional information.
The following table reconciles Net income (loss) attributable to stockholders
under
Three Months Ended
March 31, December 31, September 30, June 30,
2022 2021 2021 2020 2021 2020 2021 2020
Net income (loss) attributable
to stockholders $ 2,939 $ 3,022 $ 1,741
1,177 471 642 152 887 971 (112)
Automotive interest expense 226 250 227 275 230 327 243
303
Automotive interest income (50) (32) (44) (46) (38) (51) (32) (61) Adjustments Cruise compensation modification(a) 1,057 - - - - - - - Patent royalty matters(b) (100) - 250 - - - - - GMBrazil indirect tax matters(c) - - 194 - - - - - Cadillac dealer strategy(d) - - - 99 158 - 17 - GMI restructuring(e) - - - 26 - 76 - 92 GM Korea wage litigation(f) - - - - - - 82 - Ignition switch recall and related legal matters(g) - - - (130) - - - - Total adjustments 957 - 444 (5) 158 76 99 92 EBIT (loss)-adjusted$ 4,044 $ 4,417 $ 2,839 $ 3,712 $ 2,922 $ 5,284 $ 4,117 $ (536) _________ (a)This adjustment was excluded because it relates to the one-time modification of Cruise stock incentive awards. (b)These adjustments were excluded because they relate to potential royalties accrued with respect to past-year vehicle sales in the three months endedDecember 31, 2021 , and the resolution of substantially all of these matters in the three months endedMarch 31, 2022 . (c)This adjustment was excluded because it relates to a potential settlement with third parties in the three months endedDecember 31, 2021 relating to retrospective recoveries of indirect taxes inBrazil realized in prior periods. (d)These adjustments were excluded because they relate to strategic activities to transition certainCadillac dealers from the network as part ofCadillac's electric vehicle (EV) strategy. (e)These adjustments were excluded because of a strategic decision to rationalize our core operations by exiting or significantly reducing our presence in various international markets to focus resources on opportunities expected to deliver higher returns. These adjustments primarily consist of employee separation charges in the three months endedDecember 31, 2020 , supplier claims in the three months endedSeptember 30, 2020 and inventory provisions in the three months endedJune 30, 2020 . (f)This adjustment was excluded because of the unique events associated with recentSupreme Court of Korea decisions related to our salaried workers. (g)This adjustment was excluded because of the unique events associated with the ignition switch recall. 25
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The following table reconciles diluted earnings (loss) per common share under
Three Months Ended
March 31, 2022 March 31, 2021
Amount Per Share Amount Per Share
Diluted earnings (loss) per common
share $ 1,987 $ 1.35 $ 2,976 $ 2.03
Adjustments(a) 957 0.65 - -
Tax effect on adjustments(b) (296) (0.20) - -
Tax adjustments(c) (482) (0.33) 316 0.22
Deemed dividend adjustment(d) 909 0.62 - -
EPS-diluted-adjusted $ 3,075 $ 2.09 $ 3,292 $ 2.25
__________
(a)Refer to the reconciliation of Net income (loss) attributable to stockholders
under U.S. GAAP to EBIT (loss)-adjusted within this section of MD&A for the
details of each individual adjustment.
(b)The tax effect of each adjustment is determined based on the tax laws and
valuation allowance status of the jurisdiction to which the adjustment relates.
(c)These adjustments consist of tax benefit related to the release of a
valuation allowance against deferred tax assets that are considered realizable
as a result of Cruise tax reconsolidation in the three months ended March 31,
2022 , and tax expense related to the establishment of a valuation allowance
against deferred tax assets that were considered no longer realizable for Cruise
in the three months ended March 31, 2021 . These adjustments were excluded
because significant impacts of valuation allowances are not considered part of
our core operations.
(d)This adjustment consists of a deemed dividend related to the redemption of
Cruise preferred shares from SoftBank in the three months ended March 31, 2022 .
The following table reconciles our effective tax rate under U.S. GAAP to
ETR-adjusted:
Three Months Ended
March 31, 2022 March 31, 2021
Income tax
Income before Income tax Income before expense
income taxes expense (benefit) Effective tax rate income taxes (benefit) Effective tax rate
Effective tax rate $ 2,779 $ (28) (1.0) % $ 4,191 $ 1,177 28.1 %
Adjustments(a) 1,053 296 - -
Tax adjustment(b) 482 (316)
ETR-adjusted $ 3,832 $ 750 19.6 % $ 4,191 $ 861 20.5 %
__________
(a)Refer to the reconciliation of Net income (loss) attributable to stockholders
under U.S. GAAP to EBIT (loss)-adjusted within this section of MD&A for
adjustment details. These adjustments include Net income attributable to
noncontrolling interests where applicable. The tax effect of each adjustment is
determined based on the tax laws and valuation allowance status of the
jurisdiction to which the adjustment relates.
(b)Refer to the reconciliation of diluted earnings per common share under U.S.
GAAP to EPS-diluted-adjusted within this section of MD&A for adjustment details.
We define return on equity (ROE) as Net income (loss) attributable to
stockholders for the trailing four quarters divided by average equity for the
same period. Management uses average equity to provide comparable amounts in the
calculation of ROE. The following table summarizes the calculation of ROE
(dollars in billions):
Four Quarters Ended
March 31, 2022 March 31, 2021
Net income (loss) attributable to stockholders $ 9.9 $ 9.2
Average equity(a) $ 59.6 $ 45.7
ROE 16.7 % 20.0 %
__________(a)Includes equity of noncontrolling interests where the corresponding earnings (loss) are included in Net income (loss) attributable to stockholders.
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The following table summarizes the calculation of ROIC-adjusted (dollars in
billions):
Four Quarters Ended
March 31, 2022 March 31, 2021
EBIT (loss)-adjusted(a) $ 13.9 $ 12.9
Average equity(b) $ 59.6 $ 45.7
Add: Average automotive debt and interest liabilities (excluding finance leases)
16.9 24.7
Add: Average automotive net pension & OPEB liability 14.0 17.8
Less: Average automotive and other net income tax asset (21.8) (23.8)
ROIC-adjusted average net assets $ 68.8 $ 64.4
ROIC-adjusted 20.2 % 20.0 %
__________
(a)Refer to the reconciliation of Net income (loss) attributable to stockholders
under U.S. GAAP to EBIT (loss)-adjusted within this section of MD&A.
(b)Includes equity of noncontrolling interests where the corresponding earnings
(loss) are included in EBIT (loss)-adjusted.
Overview Our vision for the future is a world with zero crashes, zero-emissions
and zero congestion, which guides our growth-focused strategy to invest in EVs
and AVs, software-enabled services and subscriptions and new business
opportunities, while strengthening our market position in profitable internal
combustion engine vehicles, such as trucks and SUVs. We have committed to an
all-electric future with a core focus on zero-emission battery EVs as part of
our long-term strategy. We plan to execute our strategy with a diverse team and
a steadfast commitment to good citizenship through sustainable operations and a
leading health and safety culture.
The automotive industry and GM are currently experiencing supply chain
challenges, including the continuing global semiconductor supply shortage, which
continues to impact multiple suppliers. We will continue prioritizing our most
popular and in-demand vehicles, including our full-size trucks, full-size SUVs
and EVs. We do not expect these challenges to impact our long-term growth and EV
initiatives. In June 2021 , we announced plans to increase our investment in EVs
and AVs from $27.0 billion to more than $35.0 billion , through 2025, to
accelerate battery and EV assembly capacity.
We continue to monitor the impact of the COVID-19 pandemic, and government
actions and measures taken to prevent its spread, and the potential to affect
our operations. Refer to Part I, Item 1A. Risk Factors of our 2021 Form 10-K for
further discussion of these risks.
We also face continuing market, operating and regulatory challenges in several
countries across the globe due to, among other factors, weak economic
conditions, competitive pressures, our product portfolio offerings, heightened
emissions standards, labor disruptions, foreign exchange volatility, rising
material and services prices driven by inflationary pressures, evolving trade
policy and political uncertainty. Refer to Part I, Item 1A. Risk Factors of our
2021 Form 10-K for a discussion of these challenges.
As we continue to assess our performance and the needs of our evolving business,
additional restructuring and rationalization actions could be required. These
actions could give rise to future asset impairments or other charges, which may
have a material impact on our operating results.
For the year ending
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The following table reconciles expected Net income attributable to stockholders
under
Year Ending December 31 , 2022
Net income attributable to stockholders $
9.6-11.2
Income tax expense
1.6-2.0
Automotive interest expense, net 0.8 Adjustments(a) 1.0 EBIT-adjusted(b)$ 13.0-15.0 ________ (a)Refer to the reconciliation of Net income (loss) attributable to stockholders underU.S. GAAP to EBIT (loss)-adjusted within the MD&A for the details of each individual adjustment. (b)We do not consider the potential future impact of adjustments on our expected financial results.
The following table reconciles expected EPS-diluted under
Year Ending December 31, 2022
Diluted earnings per common share $ 5.76-6.76
Adjustments(a) 0.74
EPS-diluted-adjusted(b) $ 6.50-7.50
________
(a)Refer to the reconciliation of diluted earnings (loss) per common share under
U.S. GAAP to EPS-diluted-adjusted within the MD&A for the details of each
individual adjustment.
(b)We do not consider the potential future impact of adjustments on our expected
financial results.
GMNA Industry sales in North America were 4.1 million units in the three months
ended March 31, 2022 , representing a decrease of 14.3% compared to the
corresponding period in 2021. U.S. industry sales were 3.4 million units in the
three months ended March 31, 2022 , representing a decrease of 15.7% compared to
the corresponding period in 2021.
Our total vehicle sales in the U.S. , our largest market in North America , were
0.5 million units for market share of 15.2% in the three months ended March 31,
2022 , representing a decrease of 0.8 percentage points compared to the
corresponding period in 2021.
We expect to sustain relatively strong EBIT-adjusted margins in 2022 on the
continued strength of favorable vehicle pricing and strong U.S. industry light
vehicle demand, partially offset by higher costs associated with commodities,
raw materials and logistics. Our outlook is dependent on the pricing
environment, continuing improvement of supply chain challenges and overall
economic conditions. As a result of supply chain challenges, we experienced
interruptions to our planned production schedules and continue to prioritize
production of our most popular and in-demand products, including our full-size
trucks, full-size SUVs and EVs. Additionally, we have been manufacturing
vehicles without the impacted components and expect to hold these vehicles in
our inventory until they are completed and sold to our dealers.
GMI Industry sales in China were 5.8 million units in the three months ended
March 31, 2022 , representing a decrease of 13.4% compared to the corresponding
period in 2021. Our total vehicle sales in China were 0.6 million units for
market share of 10.6% in the three months ended March 31, 2022 , representing a
decrease of 1.1 percentage points compared to the corresponding period in 2021,
reflecting the impact of the semiconductor shortage and COVID-19 restrictions on
global original equipment manufacturers. The ongoing global semiconductor supply
shortage, macro-economic impact and local restrictions due to COVID-19 and
geopolitical tensions continue to place pressure on China's automotive industry
and our vehicle sales in China . Our Automotive China JVs generated equity income
of $0.2 billion in the three months ended March 31, 2022 . Although price
competition, higher costs associated with commodities and raw materials and a
more challenging regulatory environment related to emissions, fuel consumption
and new energy vehicles will place pressure on our operations in China , we will
continue to build upon our strong brands, network, and partnerships in China as
well as drive improvements in vehicle mix and cost.
Outside of China , industry sales were 5.8 million units in the three months
ended March 31, 2022 , representing a decrease of 6.9% compared to the
corresponding period in 2021. Our total vehicle sales outside of China were 0.2
million units for a market share of 3.7% in the three months ended March 31,
2022 , representing an increase of 0.2 percentage points compared to the
corresponding period in 2021.
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We historically operated a small import business in Russia and sold GM -badged
vehicles into Russia through GM's alliance partner in Uzbekistan . GM's current
direct and indirect profitability in Russia is insignificant. With Russia's
recent invasion of Ukraine , western sanctions on Russia have and may continue to
progressively increase. In addition, reputational, legal and other concerns may
impact our ability to operate in Russia . As of the end of February, we suspended
our exports into Russia and instructed our Russian sales company to cease
selling vehicles within Russia . In April, we took additional actions to extend
the suspension of our Russian business, including the cessation of commercial
operations. We continue to monitor the evolving situation. Because of the
deteriorating business environment in Russia and ongoing sanctions, our ability
to operate in Russia in the future is uncertain. In the event we were to lose
control of our Russian sales company or are otherwise unable to operate again in
Russia , we would expect to record a non-cash charge of approximately $0.6
billion to write off our investment and release accumulated translation losses.
These charges would be considered special for EBIT-adjusted and
EPS-diluted-adjusted purposes. We also expect to incur insignificant cash
charges for employee severance and other local obligations. In addition, we are
monitoring the situation and its macroeconomic impacts on our financial position
and results of operations.
Cruise Gated by safety and regulation, Cruise continues to make significant
progress towards commercialization of a network of on-demand AVs in the United
States and globally. In 2021, Cruise received a driverless test permit from the
California Public Utilities Commission (CPUC) to provide unpaid rides to the
public in driverless vehicles and received approval of its Autonomous Vehicle
Deployment Permit from the California Department of Motor Vehicles to
commercially deploy driverless AVs. Cruise will need one additional permit from
the CPUC to charge the public for driverless rides in California . Refer to the
"Liquidity and Capital Resources" section of this MD&A for information about
GM's additional investment in Cruise.
Vehicle Sales The principal factors that determine consumer vehicle preferences
in the markets in which we operate include overall vehicle design, price,
quality, available options, safety, reliability, fuel economy and functionality.
Market leadership in individual countries in which we compete varies widely.
We present both wholesale and total vehicle sales data to assist in the analysis
of our revenue and our market share. Wholesale vehicle sales data consists of
sales to GM's dealers and distributors as well as sales to the U.S. Government
and excludes vehicles sold by our joint ventures. Wholesale vehicle sales data
correlates to our revenue recognized from the sale of vehicles, which is the
largest component of Automotive net sales and revenue. In the three months ended
March 31, 2022 , 28.4% of our wholesale vehicle sales volume was generated
outside the U.S. The following table summarizes wholesale vehicle sales by
automotive segment (vehicles in thousands):
Three Months Ended
March 31, 2022 March 31, 2021
GMNA 694 83.5 % 664 80.9 %
GMI 137 16.5 % 157 19.1 %
Total 831 100.0 % 821 100.0 %
Total vehicle sales data represents: (1) retail sales (i.e., sales to consumers
who purchase new vehicles from dealers or distributors); (2) fleet sales (i.e.,
sales to large and small businesses, governments, and daily rental car
companies); and (3) vehicles used by dealers in their business. Total vehicle
sales data for periods presented prior to 2022 reflect courtesy transportation
vehicles used by U.S. dealers in their business; beginning in 2022, we stopped
including such dealership courtesy transportation vehicles in total vehicle
sales until such time as those vehicles were sold to the end customer. Total
vehicle sales data includes all sales by joint ventures on a total vehicle
basis, not based on our percentage ownership interest in the joint venture.
Certain joint venture agreements in China allow for the contractual right to
report vehicle sales of non-GM trademarked vehicles by those joint ventures,
which are included in the total vehicle sales we report for China . While total
vehicle sales data does not correlate directly to the revenue we recognize
during a particular period, we believe it is indicative of the underlying demand
for our vehicles. Total vehicle sales data represents management's good faith
estimate based on sales reported by GM's dealers, distributors, and joint
ventures, commercially available data sources such as registration and insurance
data, and internal estimates and forecasts when other data is not available.
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The following table summarizes industry and
Three Months Ended
March 31, 2022 March 31, 2021
Industry GM Market Share Industry GM Market Share
North America
United States 3,383 513 15.2 % 4,014 642 16.0 %
Other 687 88 12.8 % 735 104 14.2 %
Total North America 4,070 601 14.8 % 4,749 746 15.7 %
Asia/Pacific , Middle East and
Africa
China (a) 5,796 613 10.6 % 6,696 780 11.7 %
Other 5,016 122 2.4 % 5,357 100 1.9 %
Total Asia/Pacific , Middle East and
Africa 10,811 735 6.8 % 12,053 880 7.3 %
South America
Brazil 405 50 12.4 % 528 75 14.2 %
Other 388 40 10.3 % 357 43 12.0 %
Total South America 793 90 11.4 % 885 118 13.3 %
Total in GM markets 15,675 1,426 9.1 % 17,688 1,744 9.9 %
Total Europe 3,742 - - % 3,939 - - %
Total Worldwide(b)(c) 19,416 1,427 7.3 % 21,627 1,744 8.1 %
United States
Cars 670 47 7.0 % 857 61 7.1 %
Trucks 883 287 32.5 % 1,059 307 29.0 %
Crossovers 1,830 179 9.8 % 2,098 274 13.1 %
Total United States 3,383 513 15.2 % 4,014 642 16.0 %
China (a)
SGMS 263 347
SGMW 350 433
Total China 5,796 613 10.6 % 6,696 780 11.7 %
__________
(a)Includes sales by the Automotive China JVs: SAIC General Motors Sales Co.,
Ltd. (SGMS) and SAIC GM Wuling Automobile Co., Ltd. (SGMW).
(b)Cuba , Iran , North Korea , Sudan and Syria are subject to broad economic
sanctions. Accordingly, these countries are excluded from industry sales data
and corresponding calculation of market share.
(c)As of March 2022, GM is no longer importing vehicles or parts to Russia ,
Belarus and other sanctioned provinces in Ukraine .
As discussed above, total vehicle sales and market share data provided in the
table above includes fleet vehicles. Certain fleet transactions, particularly
sales to daily rental car companies, are generally less profitable than retail
sales to end customers. The following table summarizes estimated fleet sales and
those sales as a percentage of total vehicle sales (vehicles in thousands):
Three Months Ended
March 31, 2022 March 31, 2021
GMNA 142 133
GMI 67 60
Total fleet sales 209 193
Fleet sales as a percentage of total vehicle sales 14.7 % 11.1 %
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GM Financial We believe that offering a comprehensive suite of financing
products will generate incremental sales of our vehicles, drive incremental GM
Financial earnings and help support our sales throughout various economic
cycles. GM Financial's leasing program is exposed to residual values, which are
heavily dependent on used vehicle prices. Used vehicle prices were sustained at
high levels for the three months ended March 31, 2022 , primarily due to low new
vehicle inventory. The high levels of used vehicle prices also resulted in gains
on terminations of leased vehicles of $0.4 billion included in GM Financial
interest, operating and other expenses for the three months ended March 31, 2022
and 2021. For the remainder of 2022, GM Financial expects used vehicle prices to
decrease relative to 2021 levels, but to remain above pre-pandemic levels,
primarily due to sustained low new vehicle inventory. The following table
summarizes the estimated residual value based on GM Financial's most recent
estimates and the number of units included in GM Financial Equipment on
operating leases, net by vehicle type (units in thousands):
March 31, 2022
Residual Value Units Percentage Residual Value Units Percentage
Crossovers $ 16,134 850 67.2 % $ 16,696 897 67.3 %
Trucks 7,741 256 20.3 % 7,886 264 19.8 %
SUVs 2,952 75 5.9 % 3,104 80 5.9 %
Cars 1,278 83 6.5 % 1,430 93 7.0 %
Total $ 28,105 1,264 100.0 % $ 29,116 1,334 100.0 %
GM Financial's penetration of our retail sales in the U.S. was 46% in the three
months ended March 31, 2022 and 44% in the corresponding period in 2021.
Penetration levels vary depending on incentive financing programs available and
competing third-party financing products in the market. GM Financial's prime
loan originations as a percentage of total loan originations in North America
increased to 79% in the three months ended March 31, 2022 from 72% in the three
months ended March 31, 2021 . In the three months ended March 31, 2022 , GM
Financial's revenue consisted of leased vehicle income of 65%, retail finance
charge income of 30% and commercial finance charge income of 2%.
Consolidated Results We review changes in our results of operations under five
categories: volume, mix, price, cost and other. Volume measures the impact of
changes in wholesale vehicle volumes driven by industry volume, market share and
changes in dealer stock levels. Mix measures the impact of changes to the
regional portfolio due to product, model, trim, country and option penetration
in current year wholesale vehicle volumes. Price measures the impact of changes
related to Manufacturer's Suggested Retail Price and various sales allowances.
Cost primarily includes: (1) material and freight; (2) manufacturing,
engineering, advertising, administrative and selling and warranty expense; and
(3) non-vehicle related activity. Other primarily includes foreign exchange and
non-vehicle related automotive revenues as well as equity income or loss from
our nonconsolidated affiliates. Refer to the regional sections of this MD&A for
additional information.
Total
Three Months Ended Favorable/ Variance Due To
March 31, 2022 March 31, 2021 (Unfavorable) % Volume Mix Price Other
(Dollars in billions)
GMNA $ 29,456 $ 25,957 $ 3,499 13.5 % $ 1.0 $ 0.4 $ 1.8 $ 0.3
GMI 3,313 3,086 227 7.4 % $ (0.3) $ 0.3 $ 0.2 $ -
Corporate 53 19 34 n.m. $ - $ -
Automotive 32,823 29,062 3,761 12.9 % $ 0.7 $ 0.7 $ 2.1 $ 0.3
Cruise 26 30 (4) (13.3) % $ -
GM Financial 3,156 3,407 (251) (7.4) % $ (0.3)
Eliminations/reclassifications (26) (25) (1) 4.0 % $ - $ -
Total net sales and revenue
$ 3,505 10.8 %$ 0.7 $ 0.7 $ 2.1 $ - __________ n.m. = not meaningful
Refer to the regional sections of this MD&A for additional information on volume, mix and price.
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GENERAL MOTORS COMPANY AND SUBSIDIARIESAutomotive and Other Cost of Sales
Three Months Ended Variance Due To
March 31, Favorable/
March 31, 2022 2021 (Unfavorable) % Volume Mix Cost Other
(Dollars in billions)
GMNA $ 25,096 $ 21,962 $ (3,134) (14.3) % $ (0.7) $ (0.5) $ (2.0) $ -
GMI 3,015 2,897 (118) (4.1) % $ 0.3 $ (0.2) $ (0.1) $ -
Corporate 112 29 (83) n.m. $ - $ (0.1) $ -
Cruise 1,132 227 (905) n.m. $ (0.9)
Eliminations - - - - % $ - $ -
Total automotive and
other cost of sales $ 29,353 $ 25,115 $ (4,238) (16.9) % $ (0.5) $ (0.7) $ (3.1) $ -
__________
n.m. = not meaningful
In the three months ended March 31, 2022 , increased Cost was primarily due to:
(1) increased material and freight costs of $1.1 billion ; (2) increased costs of
$0.8 billion related to modification of Cruise stock incentive awards; (3)
increased manufacturing costs of $0.5 billion ; (4) increased costs of $0.3
billion primarily related to parts and accessories sales; and (5) increased
engineering costs of $0.2 billion primarily related to accelerating our EV
portfolio.
Refer to the regional sections of this MD&A for additional information on volume and mix.
Automotive and Other Selling, General and Administrative Expense
Three Months Ended Favorable/
March 31, 2022 March 31, 2021 (Unfavorable) %
Automotive and other selling, general and
administrative expense $ 2,504 $ 1,803 $ (701) (38.9) %
In the three months ended March 31, 2022 , Automotive and other selling, general
and administrative expense increased primarily due to increased costs of $0.3
billion related to modification of Cruise stock incentive awards and several
insignificant items.
Interest Income and Other Non-operating Income, net
Three Months Ended Favorable/
March 31, 2022 March 31, 2021 (Unfavorable) %
Interest income and other non-operating
income, net $ 517 $ 799 $ (282) (35.3) %
Interest income and other non-operating income, net decreased primarily due to
$0.2 billion in losses in the three months ended March 31, 2022 compared to $0.2
billion in gains in the three months ended March 31, 2021 related to Stellantis
warrants.
Income Tax Expense (Benefit)
Three Months Ended Favorable/
March 31, 2022 March 31, 2021 (Unfavorable) %
Income tax expense (benefit) $ (28) $ 1,177 $ 1,205 n.m.
_________
n.m. = not meaningful
In the three months ended
For the three months ended
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Refer to Note 15 to our condensed consolidated financial statements for additional information related to Income tax expense (benefit).
GM North America Three Months Ended Favorable / Variance Due ToMarch 31, 2022 March 31, 2021 (Unfavorable) % Volume Mix Price Cost Other (Dollars in billions) Total net sales and revenue$ 29,456 $ 25,957 $ 3,499 13.5 %$ 1.0 $ 0.4 $ 1.8 $ 0.3 EBIT (loss)-adjusted$ 3,141 $ 3,134 $ 7 0.2 %$ 0.3 $ (0.1) $ 1.8 $ (2.2) $ 0.1 EBIT (loss)-adjusted margin 10.7 % 12.1 % (1.4) % (Vehicles in thousands) Wholesale vehicle sales 694 664 30 4.5 % GMNA TotalNet Sales and Revenue In the three months endedMarch 31, 2022 , Total net sales and revenue increased primarily due to: (1) favorable price primarily due to lower incentives as a result of low dealer inventory levels; (2) increased net wholesale volumes primarily due to increased sales of full-size pickup trucks and full-size SUVs; (3) favorable mix associated with increased sales of full-size SUVs and full-size pickup trucks, and lower sales of certain passenger cars, partially offset by increased sales of crossover vehicles. GMNA EBIT (Loss)-Adjusted In the three months endedMarch 31, 2022 , EBIT-adjusted was consistent with the three months endedMarch 31, 2021 primarily due to: (1) favorable price; and (2) increased net wholesale volumes; offset by (3) unfavorable Cost primarily due to increased material and freight cost of$1.0 billion , increased manufacturing cost of$0.4 billion , increased selling, general and administrative costs of$0.2 billion and increased engineering cost including accelerating our EV portfolio.GM International Three Months Ended Favorable / Variance Due To March 31, 2022 March 31, 2021 (Unfavorable) % Volume Mix Price Cost Other
(Dollars in billions)
Total net sales and revenue
7.4 % $ (0.3) $ 0.3 $ 0.2 $ -
EBIT (loss)-adjusted $ 328 $ 308 $
20 6.5 % $ (0.1) $ 0.1 $ 0.2 $ (0.1) $ (0.2)
EBIT (loss)-adjusted margin 9.9 % 10.0 % (0.1) %
Equity income (loss) -
Automotive China $ 234 $ 308 $ (74) (24.0) %
EBIT (loss)-adjusted -
excluding Equity income $ 94 $ - $ 94 n.m.
(Vehicles in thousands)
Wholesale vehicle sales 137 157 (20) (12.7) %
__________
n.m. = not meaningful
The vehicle sales of our Automotive China JVs are not recorded in Total net sales and revenue. The results of our joint ventures are recorded in Equity income, which is included in EBIT (loss)-adjusted above.
GMI TotalNet Sales and Revenue In the three months endedMarch 31, 2022 , Total net sales and revenue increased primarily due to: (1) favorable mix inSouth America ,Asia/Pacific and theMiddle East ; and (2) favorable pricing across multiple vehicle lines inSouth America ; partially offset by (3) decreased wholesale volumes due to supply chain constraints, including the semiconductor shortage. 33
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GMI EBIT (Loss)-Adjusted In the three months ended March 31, 2022 , EBIT-adjusted
increased primarily due to: (1) favorable price; and (2) favorable mix;
partially offset by (3) decreased wholesale volumes; (4) unfavorable Cost
primarily due to increased material costs; and (5) unfavorable Other primarily
due to decreased equity income and foreign currency effect resulting from the
weakening of various currencies against the U.S. dollar.
We view the Chinese market as important to our global growth strategy and are
employing a multi-brand strategy. In the coming years we plan to leverage our
global architectures to increase the number of product offerings under the
Buick, Chevrolet and Cadillac brands in China and continue to grow our business
under the local Baojun and Wuling brands while we are accelerating the
development and rollout of EVs across our brands in China in response to our
commitment to an all-electric future. We operate in the Chinese market through a
number of joint ventures and maintaining strong relationships with our joint
venture partners is an important part of our China growth strategy.
The following table summarizes certain key operational and financial data for the Automotive China JVs (vehicles in thousands):
Three Months Ended
March 31, 2022 March 31, 2021
Wholesale vehicle sales, including vehicles exported to markets
outside of China 602 675
Total net sales and revenue $ 8,992 $ 9,875
Net income (loss) $ 505 $ 586
Cruise
Three Months Ended
March Favorable /
31, 2022 March 31, 2021 (Unfavorable) %
Total net sales and revenue(a) $ 26 $ 30 $ (4) (13.3) %
EBIT (loss)-adjusted(b) $ (325) $ (229) $ (96) (41.9) %
__________
(a)Primarily reclassified to Interest income and other non-operating income, net
in our condensed consolidated income statements in the three months ended March
31, 2022 and 2021.
(b)Excludes $1.1 billion in compensation expense in the three months ended March
31, 2022 resulting from modification of the Cruise stock incentive awards.
Cruise EBIT (Loss)-Adjusted In the three months ended March 31, 2022 , EBIT
(loss)-adjusted increased primarily due to an increase in development costs as
we progress towards the commercialization of a network of on-demand AVs in the
United States and globally.
GM Financial
Three Months Ended Increase/
March 31, 2022 March 31, 2021 (Decrease) %
Total revenue $ 3,156 $ 3,407 $ (251) (7.4) %
Provision for loan losses $ 122 $ (26) $ 148 n.m.
EBT (loss)-adjusted $ 1,284 $ 1,182 $ 102 8.6 %
Average debt outstanding (dollars in billions)
93.9 $ (1.1) (1.2) %
Effective rate of interest paid 2.5 % 2.8 % (0.3) %
__________
n.m. = not meaningful
GM Financial Revenue In the three months ended
GM Financial EBT-Adjusted In the three months endedMarch 31, 2022 , EBT-adjusted increased primarily due to: (1) increased leased vehicle income net of leased vehicle expenses of$0.1 billion primarily due to decreased depreciation on leased vehicles resulting from increased residual value estimates and a decrease in the size of the portfolio, partially offset by a decrease in lease termination gains; (2) decreased interest expense of$0.1 billion primarily due to decreased credit spreads on GM Financial debt, as well as a decrease in the average debt outstanding; partially offset by (3) increased provision for loan 34
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losses of $0.1 billion primarily due to a reduction in reserve levels recorded
in the three months ended March 31, 2021 as a result of actual credit
performance that was better than forecast, as well as favorable expectations for
charge-offs and recoveries to reflect improved forecast economic conditions.
Liquidity and Capital Resources We believe our current levels of cash, cash
equivalents, marketable debt securities, available borrowing capacity under our
revolving credit facilities and other liquidity actions currently available to
us are sufficient to meet our liquidity requirements. We also maintain access to
the capital markets and may issue debt or equity securities, which may provide
an additional source of liquidity. We have substantial cash requirements going
forward, which we plan to fund through our total available liquidity, cash flows
from operating activities and additional liquidity measures, if determined to be
necessary.
Our known current material uses of cash include, among other possible demands:
(1) capital spending and our investments in Ultium Cells LLC , our battery joint
venture, of approximately $9.0 billion to $10.0 billion annually over the medium
term in addition to payments for engineering and product development activities;
(2) payments associated with the previously announced vehicle recalls and any
other recall-related contingencies; (3) payments to service debt and other
long-term obligations, including discretionary and mandatory contributions to
our pension plans; and (4) payments associated with the previously announced
liquidity program for holders of equity-based incentive awards issued to
employees of Cruise pursuant to Cruise's 2018 Equity Incentive Plan, which we
expect to be $1.0 billion to $1.5 billion in 2022, with ongoing expenditures
thereafter. Our material future uses of cash, which may vary from time to time
based on market conditions and other factors, are focused on the three
objectives of our capital allocation program: (1) grow our business at an
average target ROIC-adjusted rate of 20% or greater; (2) maintain a strong
investment-grade balance sheet, including a target average automotive cash
balance of $18 billion ; and (3) after the first two objectives are met, return
available cash to shareholders. Our senior management evaluates our capital
allocation program on an ongoing basis and recommends any modifications to the
program to our Board of Directors, not less than once annually.
Our liquidity plans are subject to a number of risks and uncertainties,
including those described in the "Forward-Looking Statements" section of this
MD&A and Part I, Item 1A. Risk Factors of our 2021 Form 10-K, some of which are
outside of our control.
We continue to monitor and evaluate opportunities to strengthen our competitive
position over the long term while maintaining a strong investment-grade balance
sheet. These actions may include opportunistic payments to reduce our long-term
obligations as well as the possibility of acquisitions, dispositions and
investments with joint venture partners as well as strategic alliances that we
believe would generate significant advantages and substantially strengthen our
business.
Cash flows that occur amongst our Automotive, Cruise and GM Financial operations
are eliminated when we consolidate our cash flows. Such eliminations include,
among other things, collections by Automotive on wholesale accounts receivables
financed by dealers through GM Financial, payments between Automotive and GM
Financial for accounts receivables transferred by Automotive to GM Financial,
loans to Automotive from GM Financial, dividends issued by GM Financial to
Automotive, tax payments by GM Financial to Automotive and Automotive cash
injections in Cruise. The presentation of Automotive liquidity, Cruise liquidity
and GM Financial liquidity presented below includes the impact of cash
transactions amongst the sectors that are ultimately eliminated in
consolidation.
Automotive Liquidity Total available liquidity includes cash, cash equivalents,
marketable debt securities and funds available under credit facilities. The
amount of available liquidity is subject to seasonal fluctuations and includes
balances held by various business units and subsidiaries worldwide that are
needed to fund their operations. We have not significantly changed the
management of our liquidity, including our allocation of available liquidity,
our portfolio composition and our investment guidelines since December 31, 2021 .
Refer to Part II, Item 7. MD&A of our 2021 Form 10-K.
We use credit facilities as a mechanism to provide additional flexibility in
managing our global liquidity. Our Automotive borrowing capacity under credit
facilities totaled $15.5 billion at March 31, 2022 and December 31, 2021 . Total
Automotive borrowing capacity under our credit facilities does not include our
364-day, $2.0 billion facility allocated for exclusive use of GM Financial. We
did not have any borrowings against our primary facilities, but had letters of
credit outstanding under our sub-facility of $0.3 billion at March 31, 2022 and
December 31, 2021 .
In April 2022 , we renewed our 364-day, $2.0 billion revolving credit facility
allocated for the exclusive use of GM Financial, which now matures on April 4,
2023 . If available capacity permits, GM Financial continues to have access to
our automotive credit facilities. GM Financial did not have borrowings
outstanding against any of these facilities at March 31, 2022 and December 31,
2021 . We had intercompany loans from GM Financial of $0.1 billion and $0.2
billion at March 31, 2022 and December 31, 2021 , which primarily consisted of
commercial loans to dealers we consolidate. We did not have intercompany
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loans to GM Financial at
Several of our loan facilities, including our revolving credit facilities, require compliance with certain financial and operational covenants as well as regular reporting to lenders. We have reviewed our covenants in effect as ofMarch 31, 2022 and determined we are in compliance and expect to remain in compliance in the future.
In
The following table summarizes our Automotive available liquidity (dollars in
billions):
March 31, 2022 December 31, 2021
Automotive cash and cash equivalents $ 9.3 $ 14.5
Marketable debt securities 8.4 7.1
Automotive cash, cash equivalents and marketable debt securities
17.7 21.6
Available under credit facilities(a) 15.2 15.2
Total Automotive available liquidity $ 32.9 $ 36.8
__________
(a)We had letters of credit outstanding under our sub-facility of
The following table summarizes the changes in our Automotive available liquidity
(dollars in billions):
Three Months Ended
March 31, 2022
Operating cash flow $ 1.6
Capital expenditures (1.6)
Purchase of SoftBank's equity stake in Cruise (2.1)
GM investment in Cruise (1.4)
Investment in Ultium Cells LLC (0.2)
Other non-operating (0.3)
Total change in automotive available liquidity $ (4.0)
Automotive Cash Flow (dollars in billions)
Three Months Ended
March 31, 2022 March 31, 2021 Change
Operating Activities
Net income (loss) $ 2.6 $ 2.7 $ (0.1)
Depreciation, amortization and impairment charges 1.6 1.3 0.3
Pension and OPEB activities (0.5) (0.6) 0.1
Working capital (0.9) (3.3) 2.4
Accrued and other liabilities and income taxes (1.0) (1.5) 0.5
Other (0.2) 0.3 (0.5)
Net automotive cash provided by (used in) operating
activities $ 1.6 $ (1.1) $ 2.7
In the three months ended March 31, 2022 , the increase in Net automotive cash
provided by (used in) operating activities was primarily due to working capital;
partially offset by lower dividends received from GM Financial of $0.6 billion .
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Three Months Ended
March 31, 2022 March 31, 2021 Change
Investing Activities
Capital expenditures $ (1.6) $ (0.9) $ (0.7)
Acquisitions and liquidations of marketable
securities, net (1.5) 2.2 (3.7)
GM investment in Cruise (1.4) (1.0) (0.4)
Investment in Ultium Cells LLC (0.2) - (0.2)
Other(a) (2.1) (0.1) (2.0)
Net automotive cash provided by (used in) investing
activities $ (6.8) $ 0.2 $ (7.0)
__________
(a)Includes
In the three months ended
Three Months Ended
March 31, 2022 March 31, 2021 Change
Financing Activities
Net proceeds (payments) from short-term debt $ -
$ (0.2)
Other (0.2) 0.2 (0.4) Net automotive cash provided by (used in) financing activities$ (0.2) $ -$ (0.2) Adjusted Automotive Free Cash Flow We measure adjusted automotive free cash flow as automotive operating cash flow from operations less capital expenditures adjusted for management actions. In the three months endedMarch 31, 2022 , net automotive cash provided by operating activities underU.S. GAAP was$1.6 billion , capital expenditures were$1.6 billion , and adjustments for management actions were insignificant.
In the three months ended
Status of Credit Ratings We receive ratings from four independent credit rating agencies:DBRS Limited , Fitch Ratings, Moody's Investors Service andStandard & Poor's . All four credit rating agencies currently rate our corporate credit at investment grade. All credit ratings remained unchanged sinceDecember 31, 2021 .
Cruise Liquidity In
Additionally, inMarch 2022 ,GM and Cruise announced a liquidity program for holders of equity-based incentive awards issued to the employees of Cruise pursuant to Cruise's 2018 Equity Incentive Plan, under whichGM will purchase newly issued Cruise common stock to fund the withholding tax on vested awards andGM will conduct tender offers for Cruise common stock issued to settle vested awards. Refer to Note 16 to our condensed consolidated financial statements for additional information. 37
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GENERAL MOTORS COMPANY AND SUBSIDIARIESThe following table summarizes Cruise's available liquidity (dollars in billions):
March 31, 2022 December 31 ,
2021
Cruise cash and cash equivalents $ 2.6 $
1.6
Cruise marketable securities 1.5
1.5
Total Cruise available liquidity(a) $ 4.1 $
3.1
__________
(a)Excludes a multi-year credit agreement between Cruise and GM Financial
whereby Cruise can request to borrow, over time, up to an aggregate of
The following table summarizes the changes in Cruise's available liquidity
(dollars in billions):
Three Months Ended March 31, 2022
Operating cash flow $ (0.3)
GM investment in Cruise 1.4
Total change in Cruise available liquidity $ 1.0
Cruise Cash Flow (dollars in billions)
Three Months Ended
March 31, 2022 March 31, 2021 Change
Net cash provided by (used in) operating activities
$ (0.2)$ (0.1) Net cash provided by (used in) investing activities $ - $ (0.9)$ 0.9 Net cash provided by (used in) financing activities$ 1.3 $ 2.5$ (1.2) Automotive Financing - GM Financial Liquidity GM Financial's primary sources of cash are finance charge income, leasing income and proceeds from the sale of terminated leased vehicles, net proceeds from credit facilities, securitizations, secured and unsecured borrowings and collections and recoveries on finance receivables. GM Financial's primary uses of cash are purchases and funding of finance receivables and leased vehicles, repayment or repurchases of secured and unsecured debt, funding credit enhancement requirements in connection with securitizations and secured credit facilities, interest costs, operating expenses, income taxes and dividend payments. GM Financial continues to monitor and evaluate opportunities to optimize its liquidity position and the mix of its debt between secured and unsecured debt. The following table summarizes GM Financial's available liquidity (dollars in billions): March 31, 2022 December 31, 2021 Cash and cash equivalents $ 4.5 $ 4.0 Borrowing capacity on unpledged eligible assets 21.8 19.2 Borrowing capacity on committed unsecured lines of credit 0.6 0.5
Borrowing capacity on revolving credit facility, exclusive to GM Financial
2.0 2.0
Total GM Financial available liquidity $ 29.0 $ 25.7
At March 31, 2022 , GM Financial's available liquidity increased from December
31, 2021 due to increased available borrowing capacity on unpledged eligible
assets, resulting from the issuance of securitization transactions and unsecured
debt, and increase in cash and cash equivalents. GM Financial structures
liquidity to support at least six months of GM Financial's expected net cash
flows, including new originations, without access to new debt financing
transactions or other capital markets activity.
GM Financial did not have any borrowings outstanding against our credit facility
designated for their exclusive use or the remainder of our revolving credit
facilities at
Credit Facilities In the normal course of business, in addition to using its available cash, GM Financial utilizes borrowings under its credit facilities, which may be secured or unsecured, and GM Financial repays these borrowings as appropriate under its cash management strategy. AtMarch 31, 2022 , secured, committed unsecured and uncommitted unsecured credit facilities totaled$26.2 billion ,$0.7 billion and$1.2 billion with advances outstanding of$1.6 billion , an insignificant amount and$1.2 billion . 38
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GM Financial Cash Flow (dollars in billions)
Three Months Ended
March 31, 2022 March 31, 2021 Change
Net cash provided by (used in) operating activities
$ 1.5$ (0.3)
Net cash provided by (used in) investing activities
$ (1.6)$ 0.6 Net cash provided by (used in) financing activities$ 0.5 $ 1.4$ (0.9) In the three months endedMarch 31, 2022 , Net cash provided by operating activities decreased primarily due to: (1) a decrease in leased vehicle income of$0.3 billion ; and (2) a decrease in derivative collateral posting activities of$0.2 billion ; partially offset by (3) a decrease in interest paid of$0.2 billion . In the three months endedMarch 31, 2022 , Net cash used in investing activities decreased primarily due to: (1) a decrease in purchases of leased vehicles of$3.1 billion ; partially offset by (2) a decrease in the proceeds from termination of leased vehicles of$1.2 billion ; (3) a decrease in collections and recoveries on finance receivables of$0.9 billion ; and (4) an increase in purchases and originations of finance receivables of$0.4 billion .
In the three months ended
Critical Accounting Estimates The condensed consolidated financial statements are prepared in conformity withU.S. GAAP, which requires the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses in the periods presented. We believe the accounting estimates employed are appropriate and the resulting balances are reasonable; however, due to the inherent uncertainties in developing estimates, actual results could differ from the original estimates, requiring adjustments to these balances in future periods. The critical accounting estimates that affect the condensed consolidated financial statements and the judgments and assumptions used are consistent with those described in the MD&A in our 2021 Form 10-K. Forward-Looking Statements This report and the other reports filed by us with theSEC from time to time, as well as statements incorporated by reference herein and related comments by our management, may include "forward-looking statements" within the meaning of theU.S. federal securities laws. Forward-looking statements are any statements other than statements of historical fact. Forward-looking statements represent our current judgment about possible future events and are often identified by words like "aim," "anticipate," "appears," "approximately," "believe," "continue," "could," "designed," "effect," "estimate," "evaluate," "expect," "forecast," "goal," "initiative," "intend," "may," "objective," "outlook," "plan," "potential," "priorities," "project," "pursue," "seek," "should," "target," "when," "will," "would," or the negative of any of those words or similar expressions. In making these statements, we rely on assumptions and analysis based on our experience and perception of historical trends, current conditions and expected future developments as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results, and our actual results may differ materially due to a variety of important factors, many of which are beyond our control. These factors, which may be revised or supplemented in subsequent reports we file with theSEC , include, among others, the following: (1) our ability to deliver new products, services, technologies and customer experiences in response to increased competition and changing consumer preferences in the automotive industry; (2) our ability to timely fund and introduce new and improved vehicle models, including EVs, that are able to attract a sufficient number of consumers; (3) our ability to profitably deliver a broad portfolio of EVs that will help drive consumer adoption; (4) the success of our current line of full-size SUVs and full-size pickup trucks; (5) our highly competitive industry, which has been historically characterized by excess manufacturing capacity and the use of incentives, and the introduction of new and improved vehicle models by our competitors; (6) the unique technological, operational, regulatory and competitive risks related to the timing and commercialization of AVs; (7) risks associated with climate change, including increased regulation of greenhouse gas emissions, our transition to EVs and the potential increased impacts of severe weather events; (8) global automobile market sales volume, which can be volatile; (9) prices and uncertain availability of raw materials and commodities used by us and our suppliers, and instability in logistics and related costs; (10) our business inChina , which is subject to unique operational, competitive, regulatory and economic risks; (11) the success of our ongoing strategic business relationships and of our joint ventures, which we cannot operate solely for our benefit and over which we may have limited control; (12) the international scale and footprint of our operations, which exposes us to a variety of unique political, economic, competitive and regulatory risks, including the risk of changes in government leadership and laws (including labor, trade, tax and other laws), political 39
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uncertainty or instability and economic tensions between governments and changes
in international trade policies, new barriers to entry and changes to or
withdrawals from free trade agreements, changes in foreign exchange rates and
interest rates, economic downturns in the countries in which we operate,
differing local product preferences and product requirements, changes to and
compliance with U.S. and foreign countries' export controls and economic
sanctions, differing labor regulations, requirements and union relationships,
differing dealer and franchise regulations and relationships, difficulties in
obtaining financing in foreign countries, and public health crises, including
the occurrence of a contagious disease or illness, such as the COVID-19
pandemic; (13) any significant disruption, including any work stoppages, at any
of our manufacturing facilities; (14) the ability of our suppliers to deliver
parts, systems and components without disruption and at such times to allow us
to meet production schedules; (15) the ongoing COVID-19 pandemic; (16) the
success of any restructurings or other cost reduction actions; (17) the
possibility that competitors may independently develop products and services
similar to ours, or that our intellectual property rights are not sufficient to
prevent competitors from developing or selling those products or services; (18)
our ability to manage risks related to security breaches and other disruptions
to our information technology systems and networked products, including
connected vehicles and in-vehicle systems; (19) our ability to comply with
increasingly complex, restrictive and punitive regulations relating to our
enterprise data practices, including the collection, use, sharing and security
of the Personal Identifiable Information of our customers, employees, or
suppliers; (20) our ability to comply with extensive laws, regulations and
policies applicable to our operations and products, including those relating to
fuel economy, emissions and AVs; (21) costs and risks associated with litigation
and government investigations; (22) the costs and effect on our reputation of
product safety recalls and alleged defects in products and services; (23) any
additional tax expense or exposure; (24) our continued ability to develop
captive financing capability through GM Financial; and (25) any significant
increase in our pension funding requirements. A further list and description of
these risks, uncertainties and other factors can be found in our 2021 Form 10-K
and our subsequent filings with the SEC .
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events or other factors, except where we are expressly required to do so by law.
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