General Motors (GM) 10-K risk factor changes: FY2019 vs FY2018

[removed: If] [added: If] we do not deliver new products, services and customer experiences in response to increased competition in the automotive industry, our business could [removed: suffer.][added: suffer. We believe that the automotive industry will continue to experience significant change in the coming years.]

Industry participants are disrupting the historic business model of our industry through the introduction of new technologies, products, [removed: services,] [added: services] and methods of travel and vehicle ownership.

It is strategically significant that we [removed: lead] [added: succeed in leading] the technological disruption occurring in our industry, including consumer adoption of electric vehicles and commercialization of autonomous vehicles in a rideshare environment.

The process of designing and developing new technology, products and services is complex, [removed: costly,] [added: costly] and uncertain and requires extensive capital investment and the ability to retain and recruit talent.

[removed: Our] [added: Our] ability to maintain profitability is dependent upon our ability to timely fund and introduce new and improved vehicle models that are able to attract a sufficient number of [removed: consumers.][added: consumers. We operate in a very competitive industry with market participants routinely introducing new and improved vehicle models and features designed to meet rapidly evolving consumer expectations.]

Producing new and improved vehicle models [removed: preserving] [added: that preserve] our reputation for designing, building and selling safe, high-quality cars and trucks is critical to our long-term profitability.

[removed: Our] [added: Our] profitability is dependent upon the success of SUVs and full-size pick-up [added: trucks. While we offer a portfolio of cars, crossovers, SUVs and trucks, we generally recognize higher profit margins on our SUVs and] trucks.

Any shift in consumer preferences toward smaller, more fuel- efficient vehicles, whether as a result of increases in the price of oil or any sustained shortage of oil, including as a result of global political [removed: instability] [added: instability,] or other reasons, could weaken the demand for our higher margin vehicles.

[removed: We] [added: We] may continue to restructure our operations in the U.S. and various other countries and initiate additional cost reduction actions, but we may not succeed in doing [removed: so.][added: so. Since 2017, we have undertaken restructuring actions to lower our operating costs in response to difficult market and operating conditions in various parts of the world, including the U.S., Canada, Korea and Europe.]

As we continue to assess our performance throughout our regions, we may take additional restructuring actions to rationalize our operations, which may result in [added: material] asset write-downs or impairments and reduce our profitability in the periods incurred.

For example, [removed: in late 2018,] we [removed: announced certain] [added: are continuing to execute on the] transformation actions [added: we announced in 2018] to drive significant cost efficiencies and realign our current [added: manufacturing capacity with demand.]

[removed: GENERAL] [added: GENERAL] MOTORS COMPANY AND [removed: SUBSIDIARIES][added: SUBSIDIARIES]

[removed: There] [added: While we have achieved significant cost savings, there] is no guarantee that we will [added: fully] realize the anticipated savings or benefits from past or future restructuring and/or cost reduction actions [removed: in full or] within the time periods we [removed: expect.][added: expect or at all.]

In addition, these [added: restructuring] actions [removed: also] subject us to increased risks of labor unrest or strikes, [added: supplier, dealer, or other third-party] litigation, [added: regulator claims or proceedings,] negative publicity and business disruption.

[removed: Our] [added: Our] electric vehicle strategy is dependent upon our ability to reduce the cost of manufacturing electric vehicles, as well as increased consumer [removed: adoption.][added: adoption. We anticipate that the production and profitable sale of electric vehicles will become increasingly]

[removed: Our inability] [added: If we are unable] to reduce the costs associated with the manufacture of battery-electric [removed: vehicles] [added: vehicles, it] may negatively impact our earnings and financial condition.

[removed: We currently] [added: Our ability to] benefit from certain government and economic incentives supporting the development [added: and sale] of electric [added: vehicles has been reduced and, in some jurisdictions, eliminated or exhausted, which may negatively affect our ability to profitably sell electric] vehicles.

In addition, our sale of electric vehicles is dependent [removed: upon] [added: on] consumer adoption, which could be impacted by numerous factors, including perceptions about electric vehicle features, quality, safety, performance and cost; perceptions about the [removed: limited] range over which electric vehicles may be driven on a single battery charge; high fuel-economy internal combustion engine vehicles; volatility in the cost of fuel; government regulations and economic incentives; and access to charging facilities.

[removed: Our] [added: Our] autonomous vehicle strategy is dependent upon our ability to successfully mitigate unique technological, operational, and regulatory [removed: risks.][added: risks. In recent years, we announced significant investments in autonomous vehicle technologies, including in GM Cruise Holdings LLC (Cruise Holdings), our majority-owned subsidiary that is responsible for the development and commercialization of autonomous vehicle technology.]

Our autonomous vehicle operations are capital intensive and subject to a variety of risks inherent with the development of new technologies, [removed: including:] [added: including] our ability to continue to develop self-driving software and hardware, such as [removed: LiDAR] [added: Light Detection and Ranging (LiDAR)] sensors and other components; access to sufficient capital, including with respect to additional Softbank [removed: funding that is subject to regulatory approval;] [added: funding;] risks related to the manufacture of purpose-built autonomous vehicles; and significant competition from both established automotive companies and technology companies, some of which may have more resources and capital to devote to autonomous vehicle technologies than we do.

In addition, we face risks related to the commercial deployment of autonomous vehicles on our targeted timeline or at all, including consumer acceptance, achievement of adequate safety and other performance standards and compliance with uncertain, evolving and potentially conflicting federal and state [added: or provincial] regulations.

[removed: Our] [added: Our] business is highly dependent upon global automobile market sales volume, which can be [removed: volatile.][added: volatile. Because we have a high proportion of relatively fixed structural costs, small changes in sales volume can have a disproportionately large effect on our profitability.]

A number of economic and market conditions drive changes in vehicle sales, including real estate values, the availability and prices of used vehicles, levels of unemployment, availability of affordable financing, fluctuations in the cost of fuel, consumer confidence, political [removed: unrest] [added: unrest, the occurrence of a contagious disease or illness, such as the novel coronavirus, barriers to trade] and [added: other] global economic conditions.

[removed: Our] [added: Our] significant business in China subjects us to unique operational, competitive and regulatory [removed: risks.][added: risks. Maintaining a strong position in the Chinese market is a key component of our global growth strategy.]

Increased competition, increased U.S.-China trade restrictions and weakening economic conditions in China, among other things, may result in price reductions, reduced sales, [removed: profitability,] [added: profitability] and margins, and challenges to gain or hold market share.

[removed: In addition to increased competition,] Chinese regulators have [removed: announced] [added: implemented increasingly] aggressive [removed: "green"] [added: “green”] policy initiatives and [added: recommended] quotas for the sale of electric vehicles, which have challenging lead times.

Certain risks and uncertainties of doing business in China are solely within the control of the Chinese government, and Chinese law regulates the scope of our [removed: foreign] investments and business conducted within China.

[removed: A] [added: A] significant amount of our operations are conducted by joint ventures that we cannot operate solely for our [removed: benefit.][added: benefit. Many of our operations, primarily in China and Korea, are carried out by joint ventures.]

In joint ventures we are required to foster our relationships with our co-owners as well as promote the overall success of the joint venture, and if a co-owner changes, relationships deteriorate or strategic objectives diverge, our success in the [removed: joint venture may be materially adversely affected.]

As a result, we may be unable to prevent [removed: misconduct or other] violations of applicable laws [added: or other misconduct] by a joint [removed: venture.][added: venture or the failure to satisfy contractual obligations by one or more parties.]

[added: The international scale and footprint of our operations expose us to additional risks.] We manufacture, sell and service products globally and rely upon [removed: a] [added: an integrated] global supply chain to deliver the raw materials, components, systems and parts that we need to manufacture our products.

Our global operations subject us to extensive domestic and foreign legal and regulatory requirements, and a variety of other political, economic and regulatory risks including: (1) changes in government leadership; (2) changes in labor, [removed: tax] [added: employment, tax, privacy, environmental] and other laws, regulations or government policies impacting our overall business model or practices or restricting our ability to manufacture, purchase or sell products consistent with market demand and our business objectives; (3) political pressures to change any aspect of our business model or practices or that impair our ability to source raw materials, services, components, systems and parts, or manufacture products on competitive terms in a manner consistent with our business objectives; (4) political [removed: instability] [added: instability, civil unrest] or government controls over certain sectors; (5) political and economic tensions between governments and changes in international trade policies, including restrictions on the repatriation of dividends, especially between China [added: or Canada] and the U.S.; (6) more detailed [removed: inspections,] [added: inspections or] new or higher tariffs, for example, on products imported into or exported from the [removed: U.S.;] [added: U.S., including under Section 232 of the Trade Expansion Act of 1962, Section 301 of the U.S. Trade Act of 1974, or other trade measures;] (7) new barriers to entry or domestic preference procurement requirements, including changes to, withdrawals from or impediments to implementing free trade agreements (for example, the North American Free Trade Agreement or its [removed: successor),] [added: successor, the United States-Mexico-Canada Agreement),] or preferences of foreign nationals for domestically manufactured products; (8) changes in foreign currency exchange rates, particularly in Brazil and Argentina, and interest rates; (9) economic downturns in foreign countries or geographic regions where we have significant operations, or significant changes in conditions in the countries in which we operate; (10) differing local product preferences and product requirements, including government certification requirements related to, among other things, fuel economy, vehicle emissions and safety; (11) impact of compliance with U.S. and [removed: other] foreign countries’ export controls and economic sanctions; (12) liabilities resulting from U.S. and foreign laws and regulations, including, but not limited to, those related to the Foreign Corrupt Practices Act and certain other anti-corruption laws; (13) differing labor regulations, requirements and union relationships; (14) differing dealer and franchise regulations and relationships; [removed: and] (15) difficulties in obtaining financing in foreign countries for local [removed: operations.][added: operations; and (16) natural disasters, public health crises, including the occurrence of a contagious disease or illness, such as the novel coronavirus, and other catastrophic events.]

[removed: Any] [added: Any] significant disruption at one of our manufacturing facilities could disrupt our production [removed: schedule.][added: schedule. We assemble vehicles at various facilities around the world.]

In some cases, certain facilities produce products, systems, components and parts that disproportionately contribute a greater degree to our profitability than [removed: others.][added: others and create significant interdependencies among manufacturing facilities around the world.]

Should these or other facilities become unavailable either temporarily or permanently for any number of reasons, including labor [removed: disruptions] [added: disruptions, the occurrence of a contagious disease] or [added: illness, such as the novel coronavirus, or] catastrophic weather events, the inability to manufacture at the affected facility may result in harm to our reputation, increased costs, lower revenues and the loss of customers.

[added: Any disruption in our suppliers’ operations could disrupt our production schedule.] Our automotive operations are dependent upon the continued ability of our suppliers to deliver the systems, components, raw materials and parts that we need to manufacture our products.

[removed: Any number of factors, including] labor disruptions, catastrophic weather events, [added: the occurrence of a contagious disease or illness, such as the novel coronavirus,] contractual or other [removed: disputes with suppliers, and supplier] [added: disputes, unfavorable economic or industry conditions, delivery delays or other performance problems or] financial difficulties or solvency [removed: problems] [added: problems,] could disrupt our [removed: suppliers'] [added: suppliers’] operations and lead to uncertainty in our supply chain or cause supply disruptions for [removed: us] [added: us,] which could, in turn, disrupt our operations, including the production of certain [removed: of our] higher margin vehicles.

Any disruption of our production schedule caused by an unexpected shortage of systems, components, raw materials or parts even for a relatively short period of time could cause us to alter production schedules or suspend production [removed: entirely.][added: entirely, which could cause a loss of revenues, which would adversely affect our operations.]

[added: High prices of raw materials or other inputs used by us and our suppliers could negatively impact our profitability.] Increases in prices for raw materials or other inputs that we and our suppliers use in manufacturing products, systems, components and parts, such as steel, precious metals, or non-ferrous metals, including aluminum, copper and plastic, may lead to higher production costs for parts, components and vehicles.

Changes in trade policies and tariffs, fluctuations in supply and [removed: demand,] [added: demand] and other economic and political factors may continue to create pricing pressure for raw materials and other inputs.

More stringent fuel economy regulations could also impact our ability to sell these vehicles.

important to our business.

While we cannot predict future economic and market conditions with certainty, we expect U.S. and China industry sales volumes to be lower in 2020 relative to 2019.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

joint venture may be materially adversely affected.

In particular, substantially all of our hourly employees are represented by unions and covered by collective bargaining agreements that must be negotiated from time-to-time, often at the local facility level, which increases our risk of work stoppages.

Any number of factors, including

GENERAL MOTORS COMPANY AND SUBSIDIARIES

In particular, if the current novel coronavirus outbreak continues and results in a prolonged period of travel, commercial and other similar restrictions, we could experience global supply disruptions.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

employees, in data centers and on information technology networks (including networks that may be controlled or maintained by third parties).

Further, customers using our systems rely on the security of our infrastructure, including hardware and other elements provided by third parties, to ensure the reliability of our products and the protection of their data.

Similar regulations are coming into effect in Brazil and China, and in the U.S., California has adopted, and several states and provinces in Canada are considering adopting, laws and regulations imposing obligations regarding personal data.

In some cases, these laws provide a private right of action that would allow customers to bring suit directly against us for mishandling their data.

These government regulatory requirements, among others, could significantly affect our plans for global product development and given

GENERAL MOTORS COMPANY AND SUBSIDIARIES

There are limits on our ability to achieve fuel economy improvements over a given time frame, however, primarily relating to the cost and effectiveness of available technologies, lack of sufficient consumer acceptance of new technologies and of changes in vehicle mix, lack of willingness of consumers to absorb the additional costs of new technologies, the appropriateness (or lack thereof) of certain technologies for use in particular vehicles, the widespread availability (or lack thereof) of supporting infrastructure for new technologies, and the human, engineering, and financial resources necessary to deploy new technologies across a wide range of products and powertrains in a short time.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

Our ability to recover costs associated with recalls or other campaigns caused by parts or components purchased from suppliers may be limited by the suppliers’ financial condition or a number of other reasons or defenses.

In addition, a substantial portion of GM Financial’s indebtedness bears interest at variable interest rates, primarily based on USD-LIBOR.

The U.K. Financial Conduct Authority, which regulates LIBOR, has announced that it will no longer persuade or compel banks to submit rates for the calculation of LIBOR after 2021.

It is unknown whether any banks will continue to voluntarily submit rates for the calculation of LIBOR, or whether LIBOR will continue to be published by its administrator based on these submissions or on any other basis, after 2021.

At this time, it is not possible to predict the effect that these developments or any discontinuance, modification or other reforms may have on LIBOR, other benchmarks or floating–rate debt instruments, including GM Financial’s floating–rate debt.

Any such discontinuance, modification, alternative reference rates or other reforms may materially adversely affect interest rates on GM Financial’s current or future indebtedness.

There is a risk that the discontinuation of LIBOR will impact GM Financial's ability to manage interest rate risk effectively without an adequate replacement.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

We believe that the automotive industry will continue to experience significant change in the coming years.

We operate in a very competitive industry with market participants routinely introducing new and improved vehicle models and features designed to meet rapidly evolving consumer expectations.

While we offer a balanced portfolio of cars, crossovers, SUVs and trucks, we generally recognize higher profit margins on our SUVs and trucks.

Since 2017, we have undertaken restructuring actions to lower our operating costs in response to difficult market and operating conditions in various parts of the world, including the U.S., Korea and Europe.

manufacturing capacity and utilization in response to market-related volume declines in passenger cars.

We anticipate that the production and profitable sale of electric vehicles will become increasingly important to our business.

The benefits from these incentives could be reduced, eliminated or exhausted, which may negatively affect our ability to sell electric vehicles at high enough prices to be profitable.

In recent years, we announced significant investments in autonomous vehicle technologies, including in GM Cruise Holdings LLC (GM Cruise Holdings), our subsidiary that is responsible for the development and commercialization of autonomous vehicle technology.

Because we have a high proportion of relatively fixed structural costs, small changes in sales volume can have a disproportionately large effect on our profitability.

We cannot predict future economic and market conditions with certainty.

Maintaining a strong position in the Chinese market is a key component of our global growth strategy.

In particular, the announced intention of several Chinese cities to implement new China 6 emissions regulations in July 2019 represents a risk for the sales of our Chinese joint ventures.

Many of our operations, primarily in China and Korea, are carried out by joint ventures.

The international scale and footprint of our operations exposes us to additional risks.

We assemble vehicles at various facilities around the world.

In 2019, our collective bargaining agreement with the United Automobile Workers will expire, and we will negotiate a new agreement.

In addition, in late 2018 we announced certain restructuring actions, which included among other things, a reduction in our workforce and the unallocation of products to certain manufacturing facilities in North America.

As a result, we may be subject to an increased risk of strikes, work stoppages or other types of conflicts with labor unions and employees.

Any disruption in our suppliers' operations could disrupt our production schedule.

High prices of raw materials or other inputs used by us and our suppliers could negatively impact our profitability.

There may be instances where, notwithstanding our intellectual property position, competitive products or services may impact the value of our brands and other intangible assets, and our business may be adversely affected.

completely deter misappropriation or improper use of our technology.

We rely upon information technology systems and manufacture networked products, some of which are managed by third-parties, to process, transmit and store electronic information, and to manage or support a variety of our business processes, activities and products.

Our vehicles contain complex information technology systems.

Under these regulations, the failure to maintain compliant data practices could result in consumer complaints and regulatory inquiry, resulting in civil or criminal penalties, as well as brand impact or other harm to our business.

Similar regulations are coming into effect in Brazil, China, and California.

We are significantly affected by governmental regulations that can increase costs related to the production of our vehicles and affect our product portfolio, particularly regulations relating to emissions and fuel economy standards.

We also expect that manufacturers will continue to be subject to increased scrutiny from regulators globally.

There are limits on our ability to achieve fuel economy improvements over a given time frame, however.

We could be materially adversely affected by unusual or significant litigation, governmental investigations or other proceedings.

Government safety standards require manufacturers to remedy certain product safety defects through recall campaigns.

We are subject to the tax laws and regulations of the U.S. and numerous other jurisdictions in which we do business.

For example, the impact of the U.S. Tax Cuts and Jobs Act of 2017 (the Tax Act), which was enacted on December 22, 2017, may differ from the Company’s previously recorded amounts, possibly materially, due to potential changes in the Tax Act (including with respect to the regulations promulgated thereunder) or changes to its interpretation.

We rely on GM Financial to provide financial services to our customers and dealers in North America, South America and Asia/Pacific.

Our employee benefit plans currently hold a significant amount of equity and fixed income securities.

This [removed: Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)] [added: MD&A] should be read in conjunction with the accompanying audited consolidated financial statements and notes.

[removed: Non-GAAP Measures] [added: Non-GAAP Measures] Unless otherwise indicated, our non-GAAP measures discussed in this MD&A are related to our continuing operations and not our discontinued operations.

Our non-GAAP measures include: earnings before interest and taxes (EBIT)-adjusted, presented net of noncontrolling interests; [removed: Core EBIT-adjusted;] earnings [added: before income taxes (EBT)-adjusted for our GM Financial segment; earnings] per share (EPS)-diluted-adjusted; effective tax rate-adjusted (ETR-adjusted); return on invested capital-adjusted (ROIC-adjusted) and adjusted automotive free cash flow.

Furthermore, these non-GAAP measures allow investors the opportunity to measure and monitor our performance against our externally communicated targets and evaluate the investment [removed: decisions being made by management to improve ROIC-adjusted.]

[removed: EBIT-adjusted] [added: 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.

[removed: Core EBIT-adjusted Core EBIT-adjusted] [added: EPS-diluted-adjusted EPS-diluted-adjusted] is used by management and can be used by investors to review our [removed: core] consolidated [removed: operating results.][added: diluted EPS results on a consistent basis.]

[removed: EPS-diluted-adjusted EPS-diluted-adjusted] [added: ETR-adjusted ETR-adjusted] is used by management and can be used by investors to review [removed: our] [added: the] consolidated [removed: diluted EPS results] [added: effective tax rate for our core operations] on a consistent basis.

[removed: ROIC-adjusted] [added: 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 [removed: capital] [added: finance] leases; average automotive net pension and other postretirement benefits (OPEB) liabilities; and average [added: automotive net income tax assets during the same period.]

[removed: GENERAL] [added: GENERAL] MOTORS COMPANY AND [removed: SUBSIDIARIES][added: SUBSIDIARIES]

[removed: Adjusted] [added: Adjusted] automotive free cash [removed: flow] [added: 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.

[added: *Adjusted Automotive Free Cash Flow*] We measure adjusted automotive free cash flow as automotive operating cash flow from continuing operations less capital expenditures adjusted for management actions.

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | |

| Net income (loss) attributable to stockholders | $ | [removed: 8,014] [added: 6,732] | | | $ | [removed: (3,864] [added: 8,014] | [removed: )] | | $ | [removed: 9,427] [added: (3,864] | [added: )] |

| Loss from discontinued operations, net of tax | [removed: 70] [added: —] | | | | [removed: 4,212] [added: 70] | | | | [removed: 1] [added: 4,212] | | |

| Income tax expense | [removed: 474] [added: 769] | | | | [removed: 11,533] [added: 474] | | | | [removed: 2,739] [added: 11,533] | | |

| Automotive interest expense | [removed: 655] [added: 782] | | | | [removed: 575] [added: 655] | | | | [removed: 563] [added: 575] | | |

| Automotive interest income | [removed: (335] [added: (429] | | ) | | [removed: (266] [added: (335] | | ) | | [removed: (182] [added: (266] | | ) |

| Transformation activities(a) | [removed: 1,327] [added: 1,735] | | | | [removed: —] [added: 1,327] | | | | — | | |

| GMI [removed: restructuring(b)] [added: restructuring(d)] | [removed: 1,138] [added: —] | | | | [removed: 540] [added: 1,138] | | | | [removed: —] [added: 540] | | |

| Ignition switch recall and related legal [removed: matters(c)] [added: matters(e)] | [removed: 440] [added: —] | | | | [removed: 114] [added: 440] | | | | [removed: 300] [added: 114] | | |

| Total adjustments | [removed: 2,905] [added: 539] | | | | [removed: 654] [added: 2,905] | | | | [removed: 300] [added: 654] | | |

| EBIT-adjusted | $ | [removed: 11,783] [added: 8,393] | | | $ | [removed: 12,844] [added: 11,783] | | | $ | [removed: 12,848] [added: 12,844] | |

| (a) | These adjustments were excluded because of a strategic decision to accelerate our transformation for the future to strengthen our core business, capitalize on the future of personal mobility, and drive significant cost efficiencies. The adjustments primarily consist of [added: accelerated depreciation, supplier-related charges, pension and other curtailment charges and employee-related separation charges in the year ended December 31, 2019 and primarily] employee separation charges and accelerated [removed: depreciation.] [added: depreciation in the year ended December 31, 2018.] |

| [removed: (b)] [added: (d)] | These adjustments were excluded because of a strategic decision to rationalize our core operations by exiting or significantly reducing our presence in various international markets to focus resources on opportunities expected to deliver higher returns. The adjustments primarily consist of employee separation charges, asset impairments and supplier claims in the year ended December 31, 2018, all in Korea. The adjustment in the year ended December 31, 2017 primarily consists of asset impairments and other restructuring actions in India, South Africa and Venezuela. |

| [removed: (c)] [added: (e)] | These adjustments were excluded because of the unique events associated with the ignition switch recall, which included various investigations, inquiries and complaints from constituents. |

| EBIT [removed: loss-adjusted – GM Cruise] [added: (loss)-adjusted] | [removed: 728] [added: $] | [added: (1,004] | [added: )] | | [removed: 613] [added: $] | [added: (728] | [added: )] | | [removed: 171] [added: $] | [added: (613] | [added: )] | [added: | $ | (276 | ) | | (37.9 | )% |]

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | | | | | [removed: 2017] [added: 2018] | | | | | | | | [removed: 2016] [added: 2017] | | | | | | |

| | [removed: Amount] [added: Amount] | | | | [removed: Per Share] [added: Per Share] | | | | [removed: Amount] [added: Amount] | | | | [removed: Per Share] [added: Per Share] | | | | [removed: Amount] [added: Amount] | | | | [removed: Per Share] [added: Per Share] | | |

| Diluted earnings (loss) per common share | $ | [removed: 7,916] [added: 6,581] | | | $ | [removed: 5.53] [added: 4.57] | | | $ | [removed: (3,880] [added: 7,916] | [removed: )] | | $ | [removed: (2.60] [added: 5.53] | [removed: )] | | $ | [removed: 9,427] [added: (3,880] | [added: )] | | $ | [removed: 6.00] [added: (2.60] | [added: )] |

| Diluted loss per common share – discontinued operations | [removed: 70] [added: —] | | | | [removed: 0.05] [added: —] | | | | [removed: 4,212] [added: 70] | | | | [removed: 2.82] [added: 0.05] | | | | [removed: 1] [added: 4,212] | | | | [removed: —] [added: 2.82] | | |

| Adjustments(a) | [removed: 2,905] [added: 539] | | | | [removed: 2.03] [added: 0.38] | | | | [removed: 654] [added: 2,905] | | | | [removed: 0.44] [added: 2.03] | | | | [removed: 300] [added: 654] | | | | [removed: 0.19] [added: 0.44] | | |

| Tax effect on adjustments(b) | [removed: (416] [added: (188] | | ) | | [removed: (0.29] [added: (0.13] | | ) | | [removed: (208] [added: (416] | | ) | | [removed: (0.14] [added: (0.29] | | ) | | [removed: (114] [added: (208] | | ) | | [removed: (0.07] [added: (0.14] | | ) |

| Tax adjustments(c) | [removed: (1,111] [added: —] | | [removed: )] | | [removed: (0.78] [added: —] | | [removed: )] | | [removed: 9,099] [added: (1,111] | | [added: )] | | [removed: 6.10] [added: (0.78] | | [added: )] | | [removed: —] [added: 9,099] | | | | [removed: —] [added: 6.10] | | |

| EPS-diluted-adjusted | $ | [removed: 9,364] [added: 6,932] | | | $ | [removed: 6.54] [added: 4.82] | | | $ | [removed: 9,877] [added: 9,364] | | | $ | [removed: 6.62] [added: 6.54] | | | $ | [removed: 9,614] [added: 9,877] | | | $ | [removed: 6.12] [added: 6.62] | |

| (c) | In the year ended December 31, [removed: 2018] [added: 2018,] the adjustment consists of: (1) a non-recurring tax benefit related to foreign earnings; and (2) tax effects related to U.S. tax reform legislation. In the year ended December 31, [removed: 2017] [added: 2017,] the adjustment consisted of the tax expense of $7.3 billion related to U.S. tax reform legislation and the establishment of a valuation allowance against deferred tax assets of $2.3 billion that are no longer realizable as a result of the sale of the Opel/Vauxhall Business, partially offset by tax benefits related to tax settlements. These adjustments were excluded because impacts of tax legislation and valuation allowances are not considered part of our core operations. |

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | | | | | | | | [removed: 2017] [added: 2018] | | | | | | | | | | | [removed: 2016] [added: 2017] | | | | | | | | | |

The discussion of our financial condition and results of operations for the year ended December 31, 2017 included in Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations in our [Annual Report on Form 10-K for the year ended December 31, 2018](https://www.sec.gov/Archives/edgar/data/1467858/000146785819000033/gm201810k.htm) is incorporated by reference into this MD&A.

decisions being made by management to improve ROIC-adjusted.

Our corresponding measure for our GM Financial segment is EBT-adjusted.

When we provide an expected adjusted effective tax rate, we do not provide an expected effective tax rate because the U.S. GAAP measure may include significant adjustments that are difficult to predict.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

| GM Brazil indirect tax recoveries(b) | (1,360 | | ) | | — | | | | — | | |

| FAW-GM divestiture(c) | 164 | | | | — | | | | — | | |

| (b) | This adjustment was excluded because of the unique events associated with decisions rendered by the Superior Judicial Court of Brazil resulting in retrospective recoveries of indirect taxes. |

| (c) | This adjustment was excluded because we divested our joint venture FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM), as a result of a strategic decision by both shareholders, allowing us to focus our resources on opportunities expected to deliver higher returns. |

GENERAL MOTORS COMPANY AND SUBSIDIARIES

| | Years Ended December 31, | | | | | | | | | | |

GENERAL MOTORS COMPANY AND SUBSIDIARIES

| | Years Ended December 31, | | | | | | | | | | |

The UAW went on strike on September 16, 2019, causing subsequent stoppages to most vehicle production and parts distribution across our North America facilities.

On October 25, 2019, the UAW ratified a new collectively bargained labor agreement (Labor Agreement).

The Labor Agreement, which has a term of four years, covers the wages, hours, benefits and other terms and conditions of employment for our UAW-represented employees.

The key terms and provisions of the Labor Agreement are:

| • | Lump sum ratification bonus payments to eligible employees of $11,000 and eligible temporary employees of $4,500 in November 2019 totaling $0.5 billion; |

| • | Lump sum payments, equivalent to 4% of qualified earnings, to eligible employees in November 2019 and October 2021, totaling approximately $0.2 billion; |

| • | Lump sum payments of $1,000 to be made annually to eligible employees in June 2020 through June 2023, totaling approximately $0.2 billion; |

| • | Gross wage increases of 3% in 2020 and 2022 for eligible employees, totaling approximately $0.4 billion during the four-year agreement; |

| • | Detroit Hamtramck Assembly facility will remain open and receive a new product allocation. Lordstown Assembly, Baltimore Transmission and Warren Transmission facilities will close; |

| • | Cash severance incentive programs to qualified employees based on employee interest, eligibility and management approval; and |

| • | Additional manufacturing investments of approximately $7.7 billion to create or retain more than 9,000 UAW jobs during the period of the Labor Agreement. |

Lump sum payments are amortized over the term of the Labor Agreement.

Restructuring charges for cash severance incentive programs were recorded in the three months ended December 31, 2019 upon receipt of both employee acceptance and management approval.

We expect to offset the Labor Agreement's economics with productivity over the four-year contract period.

We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable impact of approximately $3.6 billion on our GMNA EBIT-adjusted in the year ended December 31, 2019.

In addition, we estimate an unfavorable pre-tax impact to Net cash provided by operating activities in our consolidated statement of cash flows of approximately $5.4 billion in the year ended December 31, 2019.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

We do not consider the potential future impact of adjustments on our expected financial results.

We are on track to reduce capital expenditures from approximately $8.5 billion to approximately $7.0 billion and expect to meet our revised cost savings target by the end of 2020.

We have recorded charges of $1.8 billion in 2019 and $3.1 billion cumulatively related to our 2018 transformation plans, which were complete at December 31, 2019.

We expect to sustain a strong EBIT-adjusted margin in 2020 on the relative strength of U.S. industry light vehicle sales and our recent and upcoming product launches, including our new full-size SUVs.

Cadillac achieved 3.9% growth in vehicle sales in the year ended December 31, 2019 compared to the corresponding period in 2018.

Buick, Chevrolet, Baojun and Wuling sales were softer amid a continued weak automotive industry since the second half of 2018.

Additionally, Baojun and Wuling sales were impacted by unfavorable market shifts in vehicle segments.

We will continue to build upon our strong brands, network, and partnerships in China as well as continue to drive improvements in vehicle mix and cost.

Cruise We are actively testing our autonomous vehicles in the U.S. Gated by safety and regulation, we continue to make significant progress towards commercialization of a network of on-demand autonomous vehicles in the U.S.

Core EBIT-adjusted begins with EBIT-adjusted and excludes the EBIT-adjusted results of GM Cruise.

Prior to the three months ended June 30, 2018 Core EBIT-adjusted excluded the EBIT-adjusted results of autonomous vehicle operations, including GM Cruise, Maven and our investment in Lyft, Inc. (Lyft).

The measure was changed to align with segment reporting.

All periods presented have been recast to reflect the changes.

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.

automotive net income tax assets during the same period.

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

________

The following table reconciles EBIT-adjusted to Core EBIT-adjusted:

| EBIT-adjusted(a) | $ | 11,783 | | | $ | 12,844 | | | $ | 12,848 | |

| Core EBIT-adjusted | $ | 12,511 | | | $ | 13,457 | | | $ | 13,019 | |

| (a) | Refer to the reconciliation of Net income (loss) attributable to stockholders under U.S. GAAP to EBIT-adjusted within this section of the MD&A. |

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

In addition to our EBIT-adjusted margin improvement goal, through 2018 we fully realized our financial targets of $6.5 billion in total annual operational and functional cost savings compared to 2014 costs.

The following table reconciles expected EPS-diluted under U.S. GAAP to expected EPS-diluted-adjusted and includes the future impact of the expected adjustment related to transformation activities:

| Diluted earnings per common share | $ 5.17-6.00 |

| Adjustment – transformation activities | 1.17-1.59 |

| Tax effect on adjustment(a) | (0.17-0.26) |

| EPS-diluted-adjusted | $ 6.50-7.00 |

| (a) | The tax effect of the adjustment is determined based on the tax laws and valuation allowance status of the jurisdiction to which the adjustment relates. |

We recorded charges of $1.2 billion in the year ended December 31, 2018 and expect to record additional charges of $1.5 billion to $2.0 billion in 2019.

We expect to sustain a strong EBIT-adjusted margin in 2019 on continued strength of the U.S. industry light vehicle sales, favorable vehicle mix and continued focus on overall cost savings partially offset by higher costs associated with commodities and tariffs, as well as pricing pressures.

For discussion of the risks related to a significant labor disruption at one of our facilities, refer to Item 1A.

We continue to see strength in sales of our Cadillac vehicles, and Chevrolet outperformed the passenger vehicle industry.

Baojun and Wuling sales were impacted by the market slowdown in less developed cities and market shift away from mini commercial vehicles.

While we expect China equity income to be moderately down, we expect to sustain strong China equity income by focusing on improvements in vehicle mix, cost efficiencies, and downstream performance optimization.

This increase was due primarily to increases in India and Brazil.

In February 2018 we announced the closure of a facility and other restructuring actions in Korea.

We recorded charges of $1.1 billion consisting of $0.6 billion in non-cash asset impairments and other charges and $0.5 billion in employee separation charges in the year ended December 31, 2018.

We incurred $0.8 billion in cash outflows resulting from these Korea restructuring actions for employee separations and statutory pension payments in the year ended December 31, 2018.

The charges are considered special for EBIT-adjusted, EPS-diluted-adjusted and adjusted automotive free cash flow reporting purposes.

Refer to Note 18 to our consolidated financial statements for information related to these restructuring actions.

In connection with these restructuring actions, the Korea Development Bank (KDB) purchased approximately $0.7 billion of GM Korea Company's (GM Korea) Class B Preferred Shares from GM Korea (GM Korea Preferred Shares) in 2018.

In conjunction with the GM Korea Preferred Share issuance we agreed to provide GM Korea future funding, if needed, not to exceed $2.8 billion through December 31, 2027, inclusive of $2.0 billion of planned capital expenditures through 2027.

The actions being taken to address GM Korea's financial and operational performance have and may continue to result in litigation, negative publicity, business disruption, and labor unrest.

Refer to Note 20 to our consolidated financial statements for additional information.

GM Cruise In June 2018 GM Cruise Holdings issued $0.9 billion of convertible preferred shares (GM Cruise Preferred Shares) to SoftBank Investments Holdings (UK) Limited (SoftBank).

Immediately prior to the issuance of the GM Cruise Preferred Shares, we invested $1.1 billion in GM Cruise Holdings.

The overall financial risk management program is under the responsibility of the Chief Financial Officer with support from the Financial Risk [removed: Council] [added: Council,] which reviews and, where appropriate, approves strategies to be pursued to mitigate these risks.

[removed: Automotive] [added: Automotive] The following analyses provide quantitative information regarding exposure to foreign currency exchange rate [removed: risk and] [added: risk,] interest rate [added: risk and equity price] risk.

For options and other instruments with nonlinear returns, models appropriate to these types of instruments are utilized to determine the effect [added: of market shifts.]

[removed: GENERAL] [added: GENERAL] MOTORS COMPANY AND [removed: SUBSIDIARIES][added: SUBSIDIARIES]

There are certain shortcomings inherent in the sensitivity analyses presented, [removed: due] primarily [added: due] to the assumption that interest rates change in a parallel fashion and that spot exchange rates change instantaneously.

[removed: In addition the analyses are unable to reflect the complex market reactions that normally would arise from the market shifts] modeled and do not contemplate the effects of correlations between foreign currency [removed: exposures,] [added: exposures and] offsetting long-short positions in currency or other [removed: exposures] [added: exposures,] such as interest [removed: rates] [added: rates,] which may significantly reduce the potential loss in value.

[removed: Foreign] [added: Foreign] Currency Exchange Rate [removed: Risk] [added: Risk] We have foreign currency exposures related to buying, selling and financing in currencies other than the functional currencies of our operations.

At December 31, [removed: 2018] [added: 2019] our most significant foreign currency exposures were between the U.S. Dollar and the Canadian Dollar, [added: Korean Won, Euro,] Brazilian Real, [removed: Euro, Chinese Yuan,] Australian Dollar, Mexican [removed: Peso,] [added: Peso] and [removed: Argentine Peso.][added: Chinese Yuan.]

Derivative instruments such as foreign currency forwards, swaps and options are [removed: used] primarily [added: used] to hedge exposures with respect to forecasted revenues, costs and commitments denominated in foreign currencies.

Such contracts had remaining maturities of up to 12 months at December 31, [removed: 2018.][added: 2019.]

The net fair value liability of financial instruments with exposure to foreign currency risk was [removed: $0.9] [added: $1.4] billion and [removed: $0.8] [added: $0.9] billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

The potential loss in fair value for such financial instruments from a 10% adverse change in all quoted foreign currency exchange rates would have been [added: $0.2 billion and] $0.1 billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

We had foreign currency derivatives with notional amounts of [removed: $2.7] [added: $5.1] billion and [removed: $4.0] [added: $2.7] billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

The fair value of these derivative financial instruments was [removed: insignificant.][added: insignificant at December 31, 2019 and 2018.]

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | |

| Translation [removed: (gains)] losses recorded in Accumulated other comprehensive loss | $ | [removed: 353] [added: 32] | | | $ | [removed: (275] [added: 353] | [removed: )] |

| Transaction and remeasurement [added: (gains)] losses recorded in earnings | $ | [removed: 156] [added: (77] | [added: )] | | $ | [removed: 43] [added: 156] | |

[removed: Interest] [added: Interest] Rate [removed: Risk] [added: Risk] We are subject to market risk from exposure to changes in interest rates related to certain financial instruments, primarily debt, [removed: capital] [added: finance] lease obligations and certain marketable [added: debt] securities.

We did not have any interest rate swap positions to manage interest rate exposures in our automotive operations at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

The fair value liability of debt and [removed: capital] [added: finance] leases was [removed: $13.5] [added: $15.9] billion and [removed: $15.1] [added: $13.5] billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

The potential increase in fair value resulting from a 10% decrease in quoted interest rates would have been [removed: $0.8] [added: $0.6] billion and [removed: $0.7] [added: $0.8] billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

We had marketable [added: debt] securities of [removed: $6.0] [added: $4.2] billion and [removed: $8.3] [added: $6.0] billion classified as available-for-sale at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

The potential decrease in fair value from a 50 basis point increase in interest rates would have had an insignificant effect at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

[removed: Automotive] [added: Automotive] Financing - GM [removed: Financial][added: Financial]

[removed: Interest] [added: Interest] Rate [removed: Risk] [added: Risk] Fluctuations in market interest rates can affect GM Financial's gross interest rate spread, which is the difference between interest earned on finance receivables and interest paid on debt.

Typically retail finance receivables [added: and leases] purchased by GM Financial [removed: bear] [added: earn] fixed interest [removed: rates] and [removed: are funded] [added: commercial finance receivables originated] by [added: GM Financial earn] variable [removed: or fixed rate debt.][added: interest.]

To help mitigate interest rate risk or mismatched funding, GM Financial may employ [removed: hedging strategies to lock in the interest rate spread.][added: hedging.]

[removed: Quantitative Disclosure We measure] [added: Quantitative Disclosure GM Financial measures] the sensitivity of [removed: our] [added: its] net interest income to changes in interest rates by using interest rate scenarios that assume a hypothetical, instantaneous parallel shift of one hundred basis points in all interest rates across all maturities, as well as a base case that assumes that rates perform at the current market forward curve.

[removed: Under these interest rate scenarios, we are] [added: At December 31, 2018, GM Financial was] asset-sensitive, meaning that [removed: we expect] more assets than liabilities [added: were expected] to re-price within the next twelve months.

During a period of rising interest rates, the interest earned on [removed: our] assets [removed: will] [added: would] increase more than the interest paid on [removed: our] debt, which would initially increase [removed: our] net interest income.

During a period of falling interest rates, [removed: we would expect our] net interest income [added: would be expected] to initially decrease.

The following table presents [removed: our] [added: GM Financial's] net interest income sensitivity to interest rate movement:

| One hundred basis points instantaneous increase in interest rates | $ | [removed: 10.7] [added: (4.6] | [added: )] | | $ | [removed: 19.4] [added: 10.7] | |

| One hundred basis points instantaneous decrease in interest rates(a) | $ | [removed: (10.7] [added: 4.6] | [removed: )] | | $ | [removed: (19.4] [added: (10.7] | ) |

[removed: Additional] [added: Additional] Model [removed: Assumptions] [added: Assumptions] The sensitivity analysis presented is [removed: our] [added: GM Financial's] best estimate of the effect of the hypothetical interest rate scenarios; however, [removed: our] actual results could differ.

[removed: Our] [added: The] estimates are also based on assumptions including the amortization and prepayment of the finance receivable portfolio, originations of finance receivables and leases, refinancing of maturing debt, replacement of maturing derivatives and exercise of options embedded in debt and derivatives.

[removed: Our] [added: The] prepayment projections are based on historical experience.

If interest rates or other factors change, [removed: our] actual prepayment experience could be different than projected.

[removed: Foreign] [added: Foreign] Currency Exchange Rate [removed: Risk] [added: Risk] GM Financial is exposed to foreign currency risk due to the translation and remeasurement of the results of certain international operations into U.S. Dollars as part of the consolidation process.

GM Financial had foreign currency swaps with notional amounts of [removed: $3.9] [added: $6.2] billion and [removed: $2.8] [added: $3.9] billion at December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

In addition, the analyses are unable to reflect the complex market reactions that normally would arise from the market shifts

| | 2019 | | | | 2018 | | |

Equity Price Risk We are subject to equity price risk due to market price volatility related to our investment in Lyft and PSA warrants.

The fair value of investments with exposure to equity price risk was $1.5 billion at December 31, 2019.

In March 2019 Lyft filed for an initial public offering, which significantly increased the volatility in the fair value of our investment in Lyft.

Our investment in Lyft is valued based on the quoted market price, and our investment in PSA warrants is valued based on a Black-Scholes formula.

We estimate that a 10% adverse change in quoted security prices in Lyft and PSA Group would impact our investments by $0.1 billion.

GM Financial is exposed to interest rate risks as financial assets and liabilities have different characteristics that may impact financial performance.

These differences may include tenor, yield, re-pricing timing, and prepayment expectations.

GM Financial funds its business with variable or fixed rate debt.

GENERAL MOTORS COMPANY AND SUBSIDIARIES

At December 31, 2019, GM Financial was liability-sensitive, meaning that more liabilities than assets were expected to re-price within the next twelve months.

During a period of rising interest rates, the interest paid on liabilities would increase more than the interest earned on assets, which would initially decrease net interest income.

During a period of falling interest rates, net interest income would be expected to initially increase.

GM Financial's net interest income sensitivity continued to decrease in 2019 from 2018 primarily due to GM Financial's strategy of hedging fixed-rate asset originations with pay-fixed interest rate swaps.

| | Years Ended December 31, | | | | | | |

| | 2019 | | | | 2018 | | |

| | Years Ended December 31, | | | | | | |

| | 2019 | | | | 2018 | | |

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

| | Product warranty and recall campaigns |

| Description of the matter | As discussed in Note 12 to the financial statements, the liabilities for product warranty and recall campaigns amount to $7.8 billion at December 31, 2019. The Company accrues for costs related to product warranty at the time of vehicle sale and accrues the estimated cost of recall campaigns when they are probable and estimable, which is generally at the time of sale. |

| --- | --- |

| | |

| | Auditing these liabilities is complex and involves a high degree of subjectivity in evaluating management’s estimates, due to the size, uncertainties, and potential volatility related to the estimated liabilities. Management’s estimates consider historical claims experience, including the nature, frequency, and average cost of claims of each vehicle line or each model year of the vehicle line, and the key assumptions of historical data being predictive of future activity and events, in particular, the number of historical periods used and the weighing of historical data in the reserve studies. |

| How we addressed the matter in our audit | We evaluated the design and tested the operating effectiveness of internal controls over the Company’s product warranty and recall campaign processes. We tested internal controls over management’s review of the valuation models and significant assumptions for product warranty and recall including the warranty claims forecasted based on the frequency and average cost per warranty claim for product warranty, and the cost estimates related to recall campaigns. Our audit also included the evaluation of controls that address the completeness and accuracy of the data utilized in the valuation models. |

| | Our audit procedures related to product warranty and recall campaigns also included, among others, evaluating the Company’s estimation methodology, the related significant assumptions and underlying data, and performing analytical procedures to corroborate cost per vehicle based on historical claims data. Furthermore, we performed sensitivity analyses to evaluate the significant judgments made by management, including cost estimates to evaluate the impact on reserves from changes in assumptions. We performed analysis over the vehicle lines and model years that had little or no claims experience to ensure the vehicle and model substitutions are comparable. We also involved actuarial specialists to evaluate the methodologies and assumptions, and to test the actuarial calculations used by the Company. |

| | Sales incentives |

| Description of the matter | Automotive sales and revenue represents the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or providing services, which is net of dealer and customer sales incentives the Company expects to pay. As discussed in Note 2 to the financial statements, provisions for dealer and customer incentives are recorded as a reduction to Automotive net sales and revenue at the time of vehicle sale. The liabilities for dealer and customer allowances, claims and discounts amount to $10.4 billion at December 31, 2019. |

| | Auditing the estimate of sales incentives involved a high degree of judgment. Significant factors used by the Company in estimating its liability for retail incentives include forecasted sales volumes, product mix, and the rate of customer acceptance of incentive programs, all of which are estimated based on historical experience and assumptions concerning future customer behavior and market conditions. The Company’s estimation model reflects the best estimate of the total incentive amount that the Company reasonably expects to pay at the time of sale. The estimated cost of incentives is forward-looking, and could be materially affected by future economic and market conditions. |

| How we addressed the matter in our audit | We evaluated the design and tested the operating effectiveness of internal controls over the Company’s sales incentive process, including management’s review of the estimation model, the significant assumptions (e.g., incentive cost per unit, customer take rate, and market conditions), and the data inputs used in the model. Our audit procedures included, among others, the performance of analytical procedures to develop an independent range of the liability for retail incentives as of the balance sheet date. Our independent range was developed for comparison to the Company’s recorded accrual, and is based on historical claims, forecasted spend, and the specific vehicle mix of current dealer stock. In addition, we performed sensitivity analyses over the cost per unit assumption developed by management to evaluate the impact on the liability resulting from a change in the assumption. Lastly, we assessed management’s forecasting process by performing quarterly hindsight analyses to assess the adequacy of prior forecasts. |

| | |

| --- | --- |

| | |

| | Valuation of GM Financial Equipment on Operating Leases |

| Description of the matter | GM Financial has recorded investments in vehicles leased to retail customers under operating leases. As discussed in Note 2 to the financial statements, at the beginning of the lease, management establishes an expected residual value for each vehicle at the end of the lease term. The Company’s estimated residual value of leased vehicles at the end of lease term was $30.4 billion as of December 31, 2019. |

| | Auditing management’s estimate of the residual value of leased vehicles involved a high degree of judgment. Management’s estimate is based, in part, on third-party data which considers inputs including recent auction values and significant assumptions regarding the expected future volume of leased vehicles that will be returned to the Company, used car prices, manufacturer incentive programs and fuel prices. Realization of the residual values is dependent on the future ability to market the vehicles under future prevailing market conditions. |

| How we addressed the matter in our audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the lease residual estimation process, including controls over management’s review of residual value estimates obtained from the Company’s third-party provider and other significant assumptions. Our procedures also included, among others, independently recalculating depreciation related to equipment on operating lease and performing sensitivity analyses related to significant assumptions. We also performed hindsight analyses to assess the propriety of management’s estimate of residual values, as well as tested the completeness and accuracy of data from underlying systems and data warehouses that are used in the estimation models. |

of market shifts.

| | 2018 | | | | 2017 | | |

Commercial finance receivables originated by GM Financial bear variable interest rates and are funded by variable rate debt.

Fixed interest rate receivables purchased by GM Financial may be pledged to secure borrowings under its credit facilities.

Amounts borrowed under these credit facilities bear interest at variable rates that are subject to frequent adjustments to reflect prevailing market interest rates.

To protect the interest rate spread within each credit facility, GM Financial is contractually required to enter into interest rate cap agreements in connection with borrowings under its credit facilities.

In GM Financial's securitization transactions it can transfer fixed rate finance receivables to securitization trusts that, in turn, sell either fixed rate or floating rate securities to investors.

Derivative financial instruments, such as interest rate swaps and caps, are used to manage the gross interest rate spread on the floating rate transactions.

| February 6, 2019 |

[removed: Automotive] [added: Automotive] Our automotive operations meet the demands of our customers through our automotive segments: GM North America (GMNA) and GM International (GMI).

We also have equity ownership stakes in entities that meet the demands of customers in other countries, primarily in China, with vehicles developed, manufactured and/or marketed under the Baojun, Buick, Cadillac, [removed: Chevrolet, Jiefang] [added: Chevrolet] and Wuling brands.

[removed: Competitive] [added: Competitive] Position and Vehicle [removed: Sales] [added: 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.

Wholesale vehicle sales data consists of sales to GM's dealers and distributors as well as sales to the U.S. [removed: Government,] [added: Government] and excludes vehicles sold by our joint ventures.

In the year ended December 31, [removed: 2018 36%] [added: 2019, 34%] 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):

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2016] [added: 2017] | | | | |

| [removed: GMNA(a)] [added: GMNA] | [removed: 3,555] [added: 3,214] | | | [removed: 75.5] [added: 76.4] | % | | [removed: 3,511] [added: 3,555] | | | [removed: 73.5] [added: 75.5] | % | | [removed: 3,958] [added: 3,511] | | | [removed: 75.9] [added: 73.5] | % |

| [removed: GMI(b)] [added: GMI] | [removed: 1,152] [added: 995] | | | [removed: 24.5] [added: 23.6] | % | | [removed: 1,267] [added: 1,152] | | | [removed: 26.5] [added: 24.5] | % | | [removed: 1,255] [added: 1,267] | | | [removed: 24.1] [added: 26.5] | % |

| Total | [removed: 4,707] [added: 4,209] | | | 100.0 | % | | [removed: 4,778] [added: 4,707] | | | 100.0 | % | | [removed: 5,213] [added: 4,778] | | | 100.0 | % |

| Discontinued operations | — | | | | | | [removed: 696] [added: —] | | | | | | [removed: 1,199] [added: 696] | | | | |

While total vehicle sales data does not correlate directly to the revenue we [added: recognize during a particular period, we believe it is indicative of the underlying demand for our vehicles.]

[removed: GENERAL] [added: GENERAL] MOTORS COMPANY AND [removed: SUBSIDIARIES][added: SUBSIDIARIES]

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | | | | | | [removed: 2017] [added: 2018] | | | | | | | | | [removed: 2016] [added: 2017] | | | | | | | |

| | [removed: Industry] [added: Industry] | | | [removed: GM] [added: GM] | | | [removed: Market Share] [added: Market Share] | | | [removed: Industry] [added: Industry] | | | [removed: GM] [added: GM] | | | [removed: Market Share] [added: Market Share] | | | [removed: Industry] [added: Industry] | | | [removed: GM] [added: GM] | | | [removed: Market Share] [added: Market Share] | |

| [removed: North America] [added: North America] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| United States | [removed: 17,694] [added: 17,533] | | | [removed: 2,954] [added: 2,887] | | | [removed: 16.7] [added: 16.5] | % | | [removed: 17,570] [added: 17,721] | | | [removed: 3,002] [added: 2,954] | | | [removed: 17.1] [added: 16.7] | % | | [removed: 17,886] [added: 17,570] | | | [removed: 3,043] [added: 3,002] | | | [removed: 17.0] [added: 17.1] | % |

| Total North [removed: America(a)] [added: America] | [removed: 21,529] [added: 21,175] | | | [removed: 3,490] [added: 3,367] | | | [removed: 16.2] [added: 15.9] | % | | [removed: 21,556] [added: 21,560] | | | [removed: 3,576] [added: 3,490] | | | [removed: 16.6] [added: 16.2] | % | | [removed: 21,879] [added: 21,550] | | | [removed: 3,630] [added: 3,576] | | | 16.6 | % |

| [removed: Asia/Pacific,] [added: Asia/Pacific,] Middle East and [removed: Africa] [added: Africa] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Total Asia/Pacific, Middle East and [removed: Africa(a)] [added: Africa] | [removed: 48,718] [added: 46,901] | | | [removed: 4,200] [added: 3,678] | | | [removed: 8.6] [added: 7.8] | % | | [removed: 49,518] [added: 48,777] | | | [removed: 4,670] [added: 4,202] | | | [removed: 9.4] [added: 8.6] | % | | [removed: 48,876] [added: 49,519] | | | [removed: 4,634] [added: 4,670] | | | [removed: 9.5] [added: 9.4] | % |

| [removed: South America] [added: South America] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Brazil | [removed: 2,566] [added: 2,787] | | | [removed: 434] [added: 476] | | | [removed: 16.9] [added: 17.1] | % | | [removed: 2,239] [added: 2,566] | | | [removed: 394] [added: 434] | | | [removed: 17.6] [added: 16.9] | % | | [removed: 2,050] [added: 2,239] | | | [removed: 346] [added: 394] | | | [removed: 16.9] [added: 17.6] | % |

| Other | [removed: 1,919] [added: 1,531] | | | [removed: 256] [added: 193] | | | [removed: 13.3] [added: 12.6] | % | | [removed: 1,928] [added: 1,925] | | | [removed: 275] [added: 256] | | | [removed: 14.3] [added: 13.3] | % | | [removed: 1,623] [added: 1,928] | | | [removed: 237] [added: 275] | | | [removed: 14.6] [added: 14.3] | % |

| Total South [removed: America(a)] [added: America] | [removed: 4,485] [added: 4,318] | | | [removed: 690] [added: 669] | | | [removed: 15.4] [added: 15.5] | % | | [removed: 4,167] [added: 4,491] | | | [removed: 669] [added: 690] | | | [removed: 16.1] [added: 15.4] | % | | [removed: 3,673] [added: 4,167] | | | [removed: 583] [added: 669] | | | [removed: 15.9] [added: 16.1] | % |

| Total Europe | [removed: 19,045] [added: 18,876] | | | 4 | | | — | % | | [removed: 19,190] [added: 18,928] | | | [removed: 685] [added: 4] | | | [removed: 3.6] [added: —] | % | | [removed: 18,620] [added: 19,190] | | | [removed: 1,161] [added: 685] | | | [removed: 6.2] [added: 3.6] | % |

| [removed: United States] [added: United States] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cars | [removed: 5,361] [added: 4,842] | | | [removed: 560] [added: 389] | | | [removed: 10.4] [added: 8.0] | % | | [removed: 6,145] [added: 5,389] | | | [removed: 709] [added: 560] | | | [removed: 11.5] [added: 10.4] | % | | [removed: 6,897] [added: 6,145] | | | [removed: 890] [added: 709] | | | [removed: 12.9] [added: 11.5] | % |

| Total United States | [removed: 17,694] [added: 17,533] | | | [removed: 2,954] [added: 2,887] | | | [removed: 16.7] [added: 16.5] | % | | [removed: 17,570] [added: 17,721] | | | [removed: 3,002] [added: 2,954] | | | [removed: 17.1] [added: 16.7] | % | | [removed: 17,886] [added: 17,570] | | | [removed: 3,043] [added: 3,002] | | | [removed: 17.0] [added: 17.1] | % |

| [removed: China(b)] [added: China(a)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| SGMS | | | | [removed: 1,749] [added: 1,482] | | | | | | | | | [removed: 1,906] [added: 1,749] | | | | | | | | | [removed: 1,806] [added: 1,906] | | | | |

| SGMW [removed: and FAW-GM] | | | | [removed: 1,896] [added: 1,612] | | | | | | | | | [removed: 2,135] [added: 1,896] | | | | | | | | | [removed: 2,108] [added: 2,135] | | | | |

| Total China | [removed: 26,466] [added: 25,398] | | | [removed: 3,645] [added: 3,094] | | | [removed: 13.8] [added: 12.2] | % | | [removed: 28,231] [added: 26,519] | | | [removed: 4,041] [added: 3,645] | | | [removed: 14.3] [added: 13.7] | % | | [removed: 28,274] [added: 28,231] | | | [removed: 3,914] [added: 4,041] | | | [removed: 13.8] [added: 14.3] | % |

| [removed: (b)] [added: (a)] | Includes sales by [removed: the] [added: our] Automotive China [removed: JVs] [added: Joint Ventures (Automotive China JVs):] SAIC General Motors Sales Co., Ltd. [removed: (SGMS),] [added: (SGMS) and] SAIC GM Wuling Automobile Co., Ltd. [removed: (SGMW) and FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM). In the year ended December 31, 2016 wholesale volumes were used for Industry, GM and Market Share. Our total vehicle sales in China were 3,871 in the year ended December 31, 2016.] [added: (SGMW).] |

| [removed: (c)] [added: (b)] | Includes Industry and GM sales in India and South Africa where we ceased vehicle sales for those domestic markets as of December 31, 2017. |

| [removed: (d)] [added: (c)] | Cuba, Iran, North Korea, Sudan and Syria are subject to broad economic sanctions. Accordingly these countries are excluded from industry sales data and corresponding calculation of market share. |

In the year ended December 31, [removed: 2018] [added: 2019,] we estimate we [removed: had] [added: were] the [removed: number one] market share [added: leader] in each of North America and South America, and [added: had] the number [removed: three] [added: four] market share in the Asia/Pacific, Middle East and Africa region, which included the number two market share in China.

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | |

| | [removed: 2018] [added: 2019] | | | [removed: 2017] [added: 2018] | | | [removed: 2016] [added: 2017] | |

| GMNA | [removed: 740] [added: 741] | | | [removed: 691] [added: 740] | | | [removed: 707] [added: 691] | |

| Other | 3,642 | | | 480 | | | 13.2 | % | | 3,839 | | | 536 | | | 14.0 | % | | 3,980 | | | 574 | | | 14.4 | % |

| China(a) | 25,398 | | | 3,094 | | | 12.2 | % | | 26,519 | | | 3,645 | | | 13.7 | % | | 28,231 | | | 4,041 | | | 14.3 | % |

| Other(b) | 21,503 | | | 584 | | | 2.7 | % | | 22,258 | | | 557 | | | 2.5 | % | | 21,288 | | | 629 | | | 3.0 | % |

| Total in GM markets | 72,394 | | | 7,714 | | | 10.7 | % | | 74,828 | | | 8,382 | | | 11.2 | % | | 75,236 | | | 8,915 | | | 11.8 | % |

| Total Worldwide(c) | 91,270 | | | 7,718 | | | 8.5 | % | | 93,756 | | | 8,386 | | | 8.9 | % | | 94,426 | | | 9,600 | | | 10.2 | % |

| Trucks(d) | 4,496 | | | 1,332 | | | 29.6 | % | | 4,215 | | | 1,360 | | | 32.3 | % | | 4,004 | | | 1,328 | | | 33.2 | % |

| Crossovers(d) | 8,195 | | | 1,166 | | | 14.2 | % | | 8,117 | | | 1,034 | | | 12.7 | % | | 7,421 | | | 965 | | | 13.0 | % |

| (d) | Certain industry vehicles have been reclassified between these vehicle segments. GM vehicles were not impacted by this change. The prior period has been recast to reflect the changes. |

GENERAL MOTORS COMPANY AND SUBSIDIARIES

Vehicle markets are also seasonal.

The number of authorized dealerships were 4,743 in GMNA and 7,907 in GMI at December 31, 2019.

We currently offer the Chevrolet Bolt EV, which recently improved to 259

GENERAL MOTORS COMPANY AND SUBSIDIARIES

miles of range with the 2020 model year.

We have also announced our all-new battery electric architecture that will launch on an upcoming Cadillac model.

The new platform will be flexible, allowing quick response to customer preferences with a relatively short design and development lead time.

It will be leveraged across multiple brands and vehicle sizes, styles and drive configurations.

We confirmed the GMC Hummer EV, an upcoming battery electric truck, will be built at Detroit-Hamtramck Assembly, which is being re-tooled into a fully-dedicated electric vehicle facility.

In addition, we have announced plans to mass-produce battery cells for future battery electric vehicles through an equally owned joint venture with LG Chem, Ltd.

To support mass market adoption of electric vehicles, we are working to ensure that our customers will have access to a robust, ubiquitous and seamless charging infrastructure.

For personal vehicles, this means strategically addressing charging needs at home, the workplace and in public locations.

We have announced collaborative work with several charge network operators to provide real-time data on their respective networks and charge station health to filter into our Energy Assist feature within the myChevrolet app, currently available to Chevrolet Bolt EV drivers.

This collaboration will enable access to the largest collective electric vehicle charging network in the U.S.

*Autonomous Technology* We expect autonomous technology to lead to a future of zero crashes, zero emissions and zero congestion.

We also offer a variety of connected services, including mobile applications for owners to remotely control their vehicles and electric vehicle owners to locate charging stations, on-demand vehicle diagnostics, GM Smart Driver, GM Marketplace in-vehicle commerce, connected navigation, SiriusXM with 360L and 4G LTE wireless connectivity.

Additionally, we have announced plans to integrate an in-vehicle Alexa experience through Amazon.com to millions of eligible model year 2018 and newer vehicles in 2020, and integrate Google Voice Assistant, navigation and app ecosystem into GM infotainment systems beginning in 2021.

*Intellectual Property* We are constantly innovating and hold a significant number of patents, copyrights, trade secrets and other intellectual property that protect those innovations in numerous countries.

While no single piece of intellectual property is

GENERAL MOTORS COMPANY AND SUBSIDIARIES

Costs are expected to remain elevated due to the price of commodities and the continuing existence of tariffs.

Fourteen states and the District of Columbia have adopted California emission standards, and there is a possibility that additional U.S. jurisdictions could adopt California emission requirements in the future.

In 2019, certain areas within China began implementation of the China 6 emission standard (China 6) requirements.

Brazil has recently approved a new set of national emissions standards named L7, to be implemented in 2022, and L8, to be implemented in 2025.

L7 standards include exhaust, durability, evaporative and noise limits, new OBD requirements and a phase-in for onboard refueling vapor recovery systems.

L8 standards include emission targets for real driving emissions and reduce exhaust limits every two years until 2031.

Many of the requirements are aligned with those of the EPA.

For example, our former German subsidiary has participated in

GENERAL MOTORS COMPANY AND SUBSIDIARIES

The amount of these civil penalties is the subject of litigation currently pending in the U.S. Court of Appeals for the Second Circuit.

Likewise, NHTSA and the EPA have recently issued a rule asserting that California is preempted from regulating GHG emissions, which is currently being challenged through litigation.

__________

| | |

| --- | --- |

| (a) | Wholesale vehicle sales related to transactions with the European Business were insignificant for the years ended December 31, 2017 and 2016. |

| (b) | Wholesale vehicle sales include 131 and 128 vehicles related to transactions with the European Business for the years ended December 31, 2017 and 2016. |

recognize during a particular period, we believe it is indicative of the underlying demand for our vehicles.

| Other | 3,835 | | | 536 | | | 14.0 | % | | 3,986 | | | 574 | | | 14.4 | % | | 3,993 | | | 587 | | | 14.7 | % |

| China(b) | 26,466 | | | 3,645 | | | 13.8 | % | | 28,231 | | | 4,041 | | | 14.3 | % | | 28,274 | | | 3,914 | | | 13.8 | % |

| Other(c) | 22,252 | | | 555 | | | 2.5 | % | | 21,287 | | | 629 | | | 3.0 | % | | 20,602 | | | 720 | | | 3.5 | % |

| Total in GM markets | 74,732 | | | 8,380 | | | 11.2 | % | | 75,241 | | | 8,915 | | | 11.8 | % | | 74,428 | | | 8,847 | | | 11.9 | % |

| Total Worldwide(d) | 93,777 | | | 8,384 | | | 8.9 | % | | 94,431 | | | 9,600 | | | 10.2 | % | | 93,048 | | | 10,008 | | | 10.8 | % |

| Trucks | 5,361 | | | 1,360 | | | 25.4 | % | | 5,041 | | | 1,328 | | | 26.3 | % | | 4,911 | | | 1,325 | | | 27.0 | % |

| Crossovers | 6,972 | | | 1,034 | | | 14.8 | % | | 6,384 | | | 965 | | | 15.1 | % | | 6,078 | | | 828 | | | 13.6 | % |

| (a) | Sales of Opel/Vauxhall outside of Europe were insignificant in the years ended December 31, 2017 and 2016. |

Prior to January 1, 2018 a significant portion of the sales to daily rental car companies were recorded as operating leases under U.S. GAAP with no recognition of revenue at the date of initial delivery due to guaranteed repurchase obligations.

Beginning January 1, 2018, a significant portion of the sales to daily rental car companies are recorded as sales at the time of delivery to daily rental car companies.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

The following table summarizes the number of authorized dealerships:

| | December 31, 2018 | | | December 31, 2017 | | | December 31, 2016 | |

| GMNA | 4,793 | | | 4,809 | | | 4,857 | |

| GMI | 7,716 | | | 7,641 | | | 8,598 | |

| Total | 12,509 | | | 12,450 | | | 13,455 | |

In November 2018 we announced plans to transform our product development and optimize our product portfolio.

We are evolving our global product development workforce and processes to drive world-class levels of engineering in advanced technologies and to improve quality and speed to market.

We currently offer seven 2018 model year vehicles in the U.S. featuring some form of electrification and continue to develop plug-in hybrid electric vehicle technology and extended range electric vehicles such as the Chevrolet Bolt EV.

Through December 31, 2018 Maven Gig and Maven Car Sharing have accumulated in aggregate over 171 million miles driven, 34 million all-electric miles driven and 247,000 reservations.

Maven now has 190,000 members.

Autonomous Technology We see autonomous technology leading to a future of zero crashes, zero emissions and zero congestion, since more than 90% of crashes are caused by driver error, according to the National Highway Traffic Safety Administration (NHTSA).

We are actively testing autonomous vehicles in San Francisco, California; Scottsdale, Arizona; and Michigan.

Gated by safety and regulation, we continue to make rapid progress toward commercialization of a network of on-demand autonomous vehicles in the U.S.

In addition, in October 2018 we reached an agreement to work jointly with Honda Motor Co., Ltd (Honda) to fund and develop a shared autonomous vehicle (SAV) for GM Cruise that can serve a wide variety of use cases and be manufactured at high volume.

For additional information on third-party investments in GM Cruise, refer to the Overview section of the Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A).

In Brazil, a substantial majority of vehicles sold are FlexFuel vehicles capable

of running on high ethanol blends.

We also market FlexFuel vehicles in other global markets where biofuels are in the marketplace.

We expect the collaboration to succeed by sharing expertise, economies of scale and common sourcing strategies and building upon GM's and Honda's strengths as leaders in hydrogen fuel cell technology.

OnStar also offers additional connectivity packages that include remote vehicle access through a mobile application, on-demand vehicle diagnostics, connected navigation and 4G LTE wireless connectivity.

Intellectual Property We generate and hold a significant number of patents in a number of countries in connection with the operation of our business.

We continue to experience higher commodity costs and anticipate higher costs associated with tariffs.

[removed: Refer to the] [added: The] discussion [removed: in the Litigation-Related] [added: under "Litigation-Related] Liability and Tax Administrative [removed: Matters section] [added: Matters"] in Note 16 to our consolidated financial statements [removed: for information relating to legal proceedings.][added: is incorporated by reference into this Part II - Item 3.]

[removed: UNITED] [added: UNITED] STATES SECURITIES AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] DC [removed: 20549-1004][added: 20549-1004]

[removed: Form 10-K][added: Form 10-K]

| [removed: þ] [added: ☑] | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the fiscal year [removed: ended December] [added: ended December] 31, [removed: 2018][added: 2019]

| [removed: ¨] [added: ☐] | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the transition period from [removed: to][added: to]

[removed: Commission] [added: Commission] file [removed: number 001-34960][added: number 001-34960]

[removed: GENERAL] [added: GENERAL] MOTORS [removed: COMPANY][added: COMPANY]

[removed: (Exact] [added: *(Exact] name of registrant as specified in its [removed: charter)][added: charter)*]

| [removed: STATE OF DELAWARE] [added: Delaware] | [removed: 27-0756180] | [added: | | | | | | 27-0756180 | | | | | |]

| [removed: (State] [added: *(State] or other jurisdiction [removed: of incorporation] [added: of* *incorporation] or [removed: organization)] [added: organization)*] | [removed: (I.R.S. Employer Identification No.)] | [added: | | | | | | *(I.R.S. Employer* *Identification No.)* | | | | | |]

| [removed: 300] [added: | 300] Renaissance [removed: Center, Detroit, Michigan] [added: Center,] | [removed: 48265-3000] | [added: | | Detroit, | Michigan | | 48265 | | | \-3000 | | |]

| [removed: (Address] [added: *(Address] of principal executive [removed: offices)] [added: offices)*] | [removed: (Zip Code)] | [added: | | | | | | *(Zip Code)* | | | | | |]

[removed: Registrant’s] [added: *(Registrant’s] telephone number, including area [removed: code][added: code)*]

[removed: (313) 667-1500][added: (313) 667-1500]

[removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:][added: Act:]

| Title of each class | [added: Trading Symbol(s) |] Name of each exchange on which registered |

| Common [removed: Stock] [added: Stock, $0.01 par value] | [added: GM |] New York Stock Exchange |

[removed: Securities] [added: Securities] registered pursuant to Section 12 (g) of the Act: [removed: None][added: None]

Yes [removed: þ] [added: ☑] No [removed: ¨][added: ☐]

Yes [removed: ¨] [added: ☐] No [removed: þ][added: ☑]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, [added: a] smaller reporting company or an emerging growth company.

Large accelerated filer [removed: þ] [added: ☑] Accelerated filer [removed: ¨] [added: ☐] Non-accelerated filer [removed: ¨] [added: ☐] Smaller reporting company [removed: ¨] [added: ☐] Emerging growth company [removed: ¨][added: ☐]

The aggregate market value of the voting stock held by non-affiliates of the registrant (assuming only for purposes of this computation that directors and executive officers may be affiliates) was approximately [removed: $55.5] [added: $54.7] billion as of June 30, [removed: 2018.][added: 2019.]

As of January [removed: 25, 2019] [added: 24, 2020] there were [removed: 1,409,478,926] [added: 1,429,002,063] shares of common stock outstanding.

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

[removed: INDEX][added: INDEX]

| | | | [removed: Page] [added: Page] |

| [removed: PART I] [added: PART I] | | | |

| Item 1. | Business | | [removed: [1](#sEE69C7CCD55E5E6AA4B852FB91E38BAB)] [added: [1](#s2EAC8529DD3E5410AF980633FB03C77C)] |

| Item 1A. | Risk Factors | | [removed: [10](#s59AA29B547C3533CA4DE29CF7843E57B)] [added: [10](#s01D790EC64115268A6D0D834141CED9F)] |

| Item 1B. | Unresolved Staff Comments | | [removed: [17](#s86B92000C1CC560990BA0641DF580ADD)] [added: [17](#sBD4DC0BD78E2549FA0FFEDEF3BDE4375)] |

| Item 2. | Properties | | [removed: [17](#s1E56D1FD68AC5EE493165D1B747A0127)] [added: [17](#sF611E9A6CCD656979BF385DD51C2DF1F)] |

| Item 3. | Legal Proceedings | | [removed: [17](#sEB57733E7BB15CD5B0B10A17FCD1E006)] [added: [17](#s72188EBB3A625607ADF4AF3E18EFBEA4)] |

| Item 4. | Mine Safety Disclosures | | [removed: [17](#s96DD8F876C545042B6418446109BA14F)] [added: [17](#sF794DCE4288D574A8D95B2B4073844B3)] |

| [removed: PART II] [added: PART II] | | | |

| Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | | [removed: [17](#s01EB9845DF4759788C4BF477D26879BF)] [added: [18](#sC266CBF5F8935372B717ABF57712149A)] |

| Item 6. | Selected Financial Data | | [removed: [18](#sF35E5241618C512DA6C0AE1B28E12099)] [added: [19](#sE37ECE46A5695B2CBB1491DAC3B4E19A)] |

| Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | [removed: [19](#sDAC0016FFB5D56B2A0FABEBB2618746D)] [added: [19](#sB50E99BA941C53DA8FC0355C874F88B3)] |

OR

| | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | |

| | | | | | | | | | | | | | |

Not applicable

*(Former name, former address and former fiscal year, if changed since last report)*

| | | |

| --- | --- | --- |

| | | |

Yes ☑ No ☐

Yes ☑ No ☐

Yes ☐ No ☑

| | Note 13. | Debt | [68](#s0B48BCFB74855FEAADD953158AACC94D) |

| | | | Page |

| Signatures | | | [100](#s8D4A8E7ABC1E5A7492D7C0CA9A233519) |

10-K 1 gm201810k.htm 10-K

| | |

| --- | --- |

OR

| Warrants (expiring July 10, 2019) | New York Stock Exchange |

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

(Do not check if a smaller reporting company)

| | Note 13. | Automotive and GM Financial Debt | [69](#s76BCE8E90F75511B825B2ED34838BED8) |

| Signatures | | | [105](#s4625C7831BF3539A8DBEE36540BA656D) |

At December 31, [removed: 2018] [added: 2019] we had over 100 locations in the U.S. (excluding our automotive financing operations and [removed: dealerships)] [added: dealerships),] which are primarily for manufacturing, assembly, distribution, warehousing, engineering and testing.

We have manufacturing, assembly, distribution, office or warehousing operations in [removed: 33] [added: 32] countries, including equity interests in associated [removed: companies] [added: companies,] which perform manufacturing, assembly or distribution operations.

The major facilities outside the U.S., which are principally vehicle manufacturing and assembly operations, are located in Argentina, Brazil, Canada, China, Colombia, Ecuador, Mexico, [removed: South Korea] and [removed: Thailand.][added: South Korea.]

GM Financial has [removed: 39] [added: 43] facilities, of which [removed: 26] [added: 28] are located in the U.S. The major facilities outside the U.S. are located in Brazil, [removed: Canada, China] [added: Canada] and Mexico.

In November 2018 we announced our plans to realign our manufacturing capacity in response to market-related volume declines in passenger cars.

[removed: PART II][added: PART II]

GENERAL MOTORS COMPANY AND SUBSIDIARIES

[removed: Market Information] [added: Market Information] Shares of our common stock are publicly traded on the New York Stock Exchange under the symbol "GM".

[removed: Holders] [added: Holders] At January [removed: 25, 2019] [added: 24, 2020] we had 1.4 billion issued and outstanding shares of common stock held by [removed: 501] [added: 488] holders of record.

[removed: GENERAL] [added: GENERAL] MOTORS COMPANY AND [removed: SUBSIDIARIES][added: SUBSIDIARIES]

[removed: Purchases] [added: Purchases] of Equity [removed: Securities] [added: Securities] The following table summarizes our purchases of common stock in the three months ended December 31, [removed: 2018:][added: 2019:]

| | [removed: Total] [added: Total] Number of Shares [removed: Purchased(a)] [added: Purchased(a)] | | | [removed: Weighted] [added: Weighted] Average Price Paid per [removed: Share] [added: Share] | | | | [removed: Total] [added: Total] Number of Shares Purchased Under Announced [removed: Programs(b)] [added: Programs(b)] | | | [removed: Approximate] [added: Approximate] Dollar Value of Shares That May Yet be Purchased Under Announced [removed: Programs] [added: Programs] |

| November 1, [removed: 2018] [added: 2019] through November 30, [removed: 2018] [added: 2019] | [removed: 6,552] [added: 3,480] | | | $ | [removed: 36.47] [added: 37.16] | | | — | | | $3.4 billion |

| (a) | Shares purchased [removed: includes approximately three million shares purchased and held by GM Cruise Holdings to hedge its exposure to cash settled share-based awards issued to certain of its employees. In addition, shares purchased] consist of shares [removed: retained by us for the payment of the exercise price upon the exercise of warrants and shares] delivered by employees or directors to us for the payment of taxes resulting from issuance of common stock upon the vesting of Restricted Stock Units (RSUs), Performance Stock Units (PSUs) and Restricted Stock Awards (RSAs) relating to compensation plans. In June 2017 our shareholders approved the 2017 Long Term Incentive [removed: Plan] [added: Plan,] which authorizes awards of stock options, stock appreciation rights, RSAs, RSUs, PSUs or other stock-based awards to selected employees, consultants, advisors, and non-employee Directors of the Company. Refer to Note 23 to our consolidated financial statements for additional details on employee stock incentive [removed: plans and Note 20 to our consolidated financial statements for additional details on warrants outstanding.] [added: plans.] |

| October 1, 2019 through October 31, 2019 | 23,723 | | | $ | 36.08 | | | — | | | $3.4 billion |

| December 1, 2019 through December 31, 2019 | 29,090 | | | $ | 36.28 | | | — | | | $3.4 billion |

| Total | 56,293 | | | $ | 36.25 | | | — | | | |

| October 1, 2018 through October 31, 2018 | 118,108 | | | $ | 33.53 | | | — | | | $3.4 billion |

| December 1, 2018 through December 31, 2018 | 2,992,631 | | | $ | 33.07 | | | — | | | $3.4 billion |

| Total | 3,117,291 | | | $ | 33.10 | | | — | | | |

| | [removed: At] [added: At] and for the Years Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | |

| [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | |

| [removed: Income] [added: Income] Statement [removed: Data:] [added: Data:] | | | | | | | | | | | | | | | | | | | |

| Total net sales and revenue | $ | [removed: 147,049] [added: 137,237] | | | $ | [removed: 145,588] [added: 147,049] | | | $ | [removed: 149,184] [added: 145,588] | | | $ | [removed: 135,725] [added: 149,184] | | | $ | [removed: 137,958] [added: 135,725] | |

| Income from continuing operations(a) | $ | [removed: 8,075] [added: 6,667] | | | $ | [removed: 330] [added: 8,075] | | | $ | [removed: 9,269] [added: 330] | | | $ | [removed: 9,590] [added: 9,269] | | | $ | [removed: 4,525] [added: 9,590] | |

| Basic earnings per common share – continuing operations(a) | $ | [removed: 5.66] [added: 4.62] | | | $ | [removed: 0.23] [added: 5.66] | | | $ | [removed: 6.12] [added: 0.23] | | | $ | [removed: 6.09] [added: 6.12] | | | $ | [removed: 2.06] [added: 6.09] | |

| Diluted earnings per common share – continuing operations(a) | $ | [removed: 5.58] [added: 4.57] | | | $ | [removed: 0.22] [added: 5.58] | | | $ | [removed: 6.00] [added: 0.22] | | | $ | [removed: 5.89] [added: 6.00] | | | $ | [removed: 1.95] [added: 5.89] | |

| Dividends declared per common share | $ | 1.52 | | | $ | 1.52 | | | $ | 1.52 | | | $ | [removed: 1.38] [added: 1.52] | | | $ | [removed: 1.20] [added: 1.38] | |

| [removed: Balance] [added: Balance] Sheet [removed: Data:] [added: Data:] | | | | | | | | | | | | | | | | | | | |

| Total assets(b) | $ | [removed: 227,339] [added: 228,037] | | | $ | [removed: 212,482] [added: 227,339] | | | $ | [removed: 221,690] [added: 212,482] | | | $ | [removed: 194,338] [added: 221,690] | | | $ | [removed: 177,311] [added: 194,338] | |

| Automotive notes and loans payable | $ | [removed: 13,963] [added: 14,386] | | | $ | [removed: 13,502] [added: 13,963] | | | $ | [removed: 10,560] [added: 13,502] | | | $ | [removed: 8,535] [added: 10,560] | | | $ | [removed: 9,084] [added: 8,535] | |

| GM Financial notes and loans payable | $ | [removed: 90,988] [added: 88,938] | | | $ | [removed: 80,717] [added: 90,988] | | | $ | [removed: 64,563] [added: 80,717] | | | $ | [removed: 45,479] [added: 64,563] | | | $ | [removed: 29,304] [added: 45,479] | |

| Total equity | $ | [removed: 42,777] [added: 45,957] | | | $ | [removed: 36,200] [added: 42,777] | | | $ | [removed: 44,075] [added: 36,200] | | | $ | [removed: 40,323] [added: 44,075] | | | $ | [removed: 36,024] [added: 40,323] | |

| (a) | [added: We estimate that the lost vehicle production volumes and parts sales due to the UAW strike had an unfavorable pre-tax impact of approximately $3.6 billion on our Income from continuing operations in the year ended December 31, 2019.] In the year ended December 31, [added: 2019 we recorded: (1) pre-tax charges of $1.8 billion related to transformation activities including accelerated depreciation, supplier-related charges and other charges; and (2) a pre-tax benefit of $1.4 billion related to the retrospective recoveries of indirect taxes in Brazil. In the year ended December 31,] 2018 we [removed: recorded] [added: recorded: (1) pre-tax] charges of $1.3 billion related to transformation activities including employee separation, accelerated depreciation and other [removed: charges,] [added: charges; (2) pre-tax charges of] $1.1 billion related to the closure of a facility and other restructuring actions in [removed: Korea,] [added: Korea; (3) pre-tax] charges of $0.4 billion for ignition switch related legal [removed: matters,] [added: matters;] and [added: (4)] a non-recurring tax benefit of $1.0 billion related to foreign earnings. In the year ended December 31, 2017 we [removed: recorded] [added: recorded: (1)] tax expense of $7.3 billion related to U.S. tax reform [removed: legislation,] [added: legislation; (2)] $2.3 billion related to the establishment of a valuation allowance against deferred tax assets that will no longer be realizable as a result of the sale of the Opel/Vauxhall [removed: Business,] [added: Business;] and [added: (3) pre-tax] charges of $0.5 billion related to restructuring actions in India and South Africa. In the year ended December 31, 2015 we [removed: recorded] [added: recorded: (1)] the reversal of deferred tax asset valuation allowances of $3.9 billion in [removed: Europe] [added: Europe;] and [removed: recorded] [added: (2) pre-tax] charges related to the Ignition Switch Recall Compensation Program [removed: (Compensation Program)] and for various legal matters of approximately $1.6 billion. [removed: In the year ended December 31, 2014 we recorded charges of approximately $2.8 billion in Automotive and other cost of sales related to recall campaigns and courtesy transportation, a catch-up adjustment of $0.9 billion related to the change in estimate for recall campaigns and a charge of $0.4 billion related to the Compensation Program. In December 2014 we redeemed all of the remaining shares of our Series A Preferred Stock for $3.9 billion, which reduced Income from continuing operations by $0.8 billion.] |

| (b) | Total assets included assets held for sale of $20.6 [removed: billion, $20.0 billion,] [added: billion] and [removed: $17.8] [added: $20.0] billion at December 31, [removed: 2016, 2015] [added: 2016] and [removed: 2014.] [added: 2015.] |

GENERAL MOTORS COMPANY AND SUBSIDIARIES

[removed: CONSOLIDATED] [added: CONSOLIDATED] INCOME [removed: STATEMENTS][added: STATEMENTS]

[removed: (In] [added: (In] millions, except per share [removed: amounts)][added: amounts)]

| | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | |

| | [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | |

| [removed: Net] [added: Net] sales and [removed: revenue] [added: revenue] | | | | | | | | | | | |

| Automotive | $ | [removed: 133,045] [added: 122,697] | | | $ | [removed: 133,449] [added: 133,045] | | | $ | [removed: 140,205] [added: 133,449] | |

| GM Financial | [removed: 14,004] [added: 14,540] | | | | [removed: 12,139] [added: 14,004] | | | | [removed: 8,979] [added: 12,139] | | |

| Total net sales and revenue (Note 3) | [removed: 147,049] [added: 137,237] | | | | [removed: 145,588] [added: 147,049] | | | | [removed: 149,184] [added: 145,588] | | |

| [removed: Costs] [added: Costs] and [removed: expenses] [added: expenses] | | | | | | | | | | | |

| Automotive and other cost of sales | [removed: 120,656] [added: 110,651] | | | | [removed: 116,229] [added: 120,656] | | | | [removed: 121,784] [added: 116,229] | | |

| GM Financial interest, operating and other expenses | [removed: 12,298] [added: 12,614] | | | | [removed: 11,128] [added: 12,298] | | | | [removed: 8,369] [added: 11,128] | | |