General Motors Co [GM] Filings

10-Q 1 gm-20220630.htm 10-Q gm-20220630

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-Q


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-34960

GENERAL MOTORS COMPANY

(Exact name of registrant as specified in its charter)

Delaware

27-0756180

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

300 Renaissance Center,

Detroit,

Michigan

48265

-3000

(Address of principal executive offices)

(Zip Code)

(313) 667-1500

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	GM	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☑ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of July 13, 2022 there were 1,458,048,958 shares of common stock outstanding.

INDEX


			Page
PART I
Item 1.	Condensed Consolidated Financial Statements		1
	Condensed Consolidated Income Statements (Unaudited)		1
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)		1
	Condensed Consolidated Balance Sheets (Unaudited)		2
	Condensed Consolidated Statements of Cash Flows (Unaudited)		3
	Condensed Consolidated Statements of Equity (Unaudited)		4
	Notes to Condensed Consolidated Financial Statements		5
	Note 1.	Nature of Operations and Basis of Presentation	5
	Note 2.	Significant Accounting Policies	5
	Note 3.	Revenue	6
	Note 4.	Marketable and Other Securities	8
	Note 5.	GM Financial Receivables and Transactions	9
	Note 6.	Inventories	12
	Note 7.	Equipment on Operating Leases	12
	Note 8.	Equity in Net Assets of Nonconsolidated Affiliates	13
	Note 9.	Variable Interest Entities	13
	Note 10.	Debt	14
	Note 11.	Derivative Financial Instruments	15
	Note 12.	Product Warranty and Related Liabilities	17
	Note 13.	Pensions and Other Postretirement Benefits	18
	Note 14.	Commitments and Contingencies	18
	Note 15.	Income Taxes	21

	Note 16.	Stockholders' Equity and Noncontrolling Interests	21
	Note 17.	Earnings Per Share	23

	Note 18.	Stock Incentive Plans	23
	Note 19.	Segment Reporting	24

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		46
Item 4.	Controls and Procedures		46
PART II
Item 1.	Legal Proceedings		47
Item 1A.	Risk Factors		47
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		48
Item 6.	Exhibits		49
Signature			50

Table of Contents

GENERAL MOTORS COMPANY AND SUBSIDIARIES

PART I

Item 1. Condensed Consolidated Financial Statements

CONDENSED CONSOLIDATED INCOME STATEMENTS

(In millions, except per share amounts) (Unaudited)


	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Net sales and revenue
Automotive	$	32,614	$	30,744	$	65,437	$	59,811
GM Financial	3,145		3,423		6,301		6,830
Total net sales and revenue (Note 3)	35,759		34,167		71,738		66,641
Costs and expenses
Automotive and other cost of sales	29,261		27,266		58,614		52,381
GM Financial interest, operating and other expenses	2,089		1,894		4,015		4,173
Automotive and other selling, general and administrative expense	2,293		2,125		4,797		3,928

Total costs and expenses	33,643		31,285		67,426		60,482
Operating income (loss)	2,116		2,882		4,313		6,159
Automotive interest expense	234		243		460		493
Interest income and other non-operating income, net	295		784		812		1,583

Equity income (loss) (Note 8)	(45)		327		247		692
Income (loss) before income taxes	2,132		3,750		4,912		7,941
Income tax expense (benefit) (Note 15)	490		971		462		2,148


Net income (loss)	1,642		2,779		4,449		5,793
Net loss (income) attributable to noncontrolling interests	50		57		181		65
Net income (loss) attributable to stockholders	$	1,692	$	2,836	$	4,631	$	5,858

Net income (loss) attributable to common stockholders	$	1,666	$	2,790	$	3,653	$	5,767

Earnings per share (Note 17)

Basic earnings per common share	$	1.14	$	1.92	$	2.51	$	3.98
Weighted-average common shares outstanding – basic	1,458		1,451		1,458		1,449


Diluted earnings per common share	$	1.14	$	1.90	$	2.49	$	3.93
Weighted-average common shares outstanding – diluted	1,465		1,468		1,468		1,466

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions) (Unaudited)


	Three Months Ended				Six Months Ended
	June 30, 2022		June 30, 2021			June 30, 2022		June 30, 2021
Net income (loss)	$	1,642	$	2,779		$	4,449	$	5,793
Other comprehensive income (loss), net of tax (Note 16)
Foreign currency translation adjustments and other	(349)		302			(10)		297
Defined benefit plans	275		28			378		188
Other comprehensive income (loss), net of tax	(74)		330			368		485
Comprehensive income (loss)	1,568		3,109			4,817		6,278
Comprehensive income (loss) attributable to noncontrolling interests	61		57			206		72
Comprehensive income (loss) attributable to stockholders	$	1,629	$	3,166		$	5,023	$	6,350

Reference should be made to the notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

Table of Contents

GENERAL MOTORS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts) (Unaudited)


	June 30, 2022		December 31, 2021
ASSETS
Current Assets
Cash and cash equivalents	$	16,710	$	20,067
Marketable debt securities (Note 4)	10,124		8,609

Accounts and notes receivable, net of allowance of $214 and $192	12,417		7,394
GM Financial receivables, net of allowance of $782 and $703 (Note 5; Note 9 at VIEs)	28,479		26,649
Inventories (Note 6)	16,859		12,988

Other current assets (Note 4; Note 9 at VIEs)	6,504		6,396
Total current assets	91,094		82,103
Non-current Assets

GM Financial receivables, net of allowance of $1,245 and $1,183 (Note 5; Note 9 at VIEs)	38,227		36,167
Equity in net assets of nonconsolidated affiliates (Note 8)	9,733		9,677
Property, net	41,943		41,115
Goodwill and intangible assets, net	5,013		5,087
Equipment on operating leases, net (Note 7; Note 9 at VIEs)	35,307		37,929
Deferred income taxes	21,038		21,152
Other assets (Note 4; Note 9 at VIEs)	11,161		11,488
Total non-current assets	162,423		162,615
Total Assets	$	253,517	$	244,718

LIABILITIES AND EQUITY
Current Liabilities
Accounts payable (principally trade)	$	25,890	$	20,391
Short-term debt and current portion of long-term debt (Note 10)
Automotive	662		463
GM Financial (Note 9 at VIEs)	31,644		33,257
Accrued liabilities	21,203		20,297
Total current liabilities	79,398		74,408
Non-current Liabilities
Long-term debt (Note 10)
Automotive	16,121		16,355
GM Financial (Note 9 at VIEs)	61,960		59,304
Postretirement benefits other than pensions (Note 13)	5,629		5,743
Pensions (Note 13)	7,358		8,008
Other liabilities	14,677		15,085
Total non-current liabilities	105,744		104,495
Total Liabilities	185,142		178,903
Commitments and contingencies (Note 14)
Noncontrolling Interest - Cruise Stock Incentive Awards (Note 18)	115		—
Equity (Note 16)
Common stock, $0.01 par value	15		15
Additional paid-in capital	27,261		27,061
Retained earnings	45,554		41,937
Accumulated other comprehensive loss	(8,876)		(9,269)
Total stockholders’ equity	63,954		59,744
Noncontrolling interests	4,306		6,071
Total Equity	68,260		65,815
Total Liabilities and Equity	$	253,517	$	244,718

Reference should be made to the notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

Table of Contents

GENERAL MOTORS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions) (Unaudited)


	Six Months Ended
	June 30, 2022		June 30, 2021
Cash flows from operating activities
Net income (loss)	$	4,449	$	5,793
Depreciation and impairment of Equipment on operating leases, net	2,427		3,218
Depreciation, amortization and impairment charges on Property, net	3,320		2,815
Foreign currency remeasurement and transaction (gains) losses	75		(25)

Undistributed earnings of nonconsolidated affiliates, net	(201)		16
Pension contributions and OPEB payments	(401)		(425)
Pension and OPEB income, net	(602)		(803)

Provision (benefit) for deferred taxes	79		1,813
Change in other operating assets and liabilities	(3,919)		(3,974)




Net cash provided by (used in) operating activities	5,228		8,428
Cash flows from investing activities
Expenditures for property	(3,829)		(2,451)
Available-for-sale marketable securities, acquisitions	(5,605)		(4,090)

Available-for-sale marketable securities, liquidations	3,838		6,926






Purchases of finance receivables, net	(17,229)		(17,485)
Principal collections and recoveries on finance receivables	13,660		11,946
Purchases of leased vehicles, net	(6,203)		(12,439)
Proceeds from termination of leased vehicles	7,549		10,868
Other investing activities	(409)		(285)


Net cash provided by (used in) investing activities	(8,227)		(7,010)
Cash flows from financing activities
Net increase (decrease) in short-term debt	1,015		2,365
Proceeds from issuance of debt (original maturities greater than three months)	23,596		25,955
Payments on debt (original maturities greater than three months)	(22,264)		(27,035)
Issuance (redemptions) of subsidiary preferred stock (Note 16)	(2,127)		1,736
Dividends paid	(81)		(94)
Other financing activities	(901)		(90)


Net cash provided by (used in) financing activities	(762)		2,837
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(66)		(7)
Net increase (decrease) in cash, cash equivalents and restricted cash	(3,827)		4,248
Cash, cash equivalents and restricted cash at beginning of period	23,542		23,117
Cash, cash equivalents and restricted cash at end of period	$	19,715	$	27,365








Significant Non-cash Investing and Financing Activity
Non-cash property additions	$	4,163	$	3,668

Reference should be made to the notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

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GENERAL MOTORS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(In millions) (Unaudited)


	Common Stockholders’								Noncontrolling Interests		Total Equity (Permanent Equity)		Noncontrolling Interest Cruise Stock Incentive Awards (Temporary Equity)
	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss
Balance at January 1, 2021	$	14	$	26,542	$	31,962	$	(13,488)	$	4,647	$	49,677	$	—

Net income (loss)	—		—		3,022		—		(8)		3,014		—
Other comprehensive income (loss)	—		—		—		162		(7)		155		—
Issuance (redemption) of subsidiary preferred stock (Note 16)	—		—		—		—		1,537		1,537		—

Stock based compensation	—		132		—		—		—		132		—

Dividends to noncontrolling interests	—		—		—		—		(61)		(61)		—
Other	—		(7)		4		—		(8)		(11)		—
Balance at March 31, 2021	14		26,667		34,988		(13,326)		6,100		54,443		—


Net income (loss)	—		—		2,836		—		(57)		2,779		—
Other comprehensive income (loss)	—		—		—		330		—		330		—
Issuance (redemption) of subsidiary preferred stock (Note 16)	—		—		—		—		199		199		—

Stock based compensation	—		177		(4)		—		—		173		—

Dividends to noncontrolling interests	—		—		—		—		(64)		(64)		—
Other	1		—		(14)		—		29		16		—
Balance at June 30, 2021	$	15	$	26,844	$	37,806	$	(12,996)	$	6,207	$	57,876	$	—























Balance at January 1, 2022	$	15	$	27,061	$	41,937	$	(9,269)	$	6,071	$	65,815	$	—

Net income (loss)	—		—		2,939		—		(131)		2,807		—
Other comprehensive income (loss)	—		—		—		456		(13)		442		—
Issuance (redemption) of subsidiary preferred stock (Note 16)	—		—		(909)		—		(1,215)		(2,124)		—

Stock based compensation	—		(31)		(1)		—		—		(32)		289

Dividends to noncontrolling interests	—		—		(12)		—		(1)		(14)		—
Other	—		(15)		(74)		—		(31)		(120)		—
Balance at March 31, 2022	15		27,015		43,879		(8,814)		4,679		66,774		289


Net income (loss)	—		—		1,692		—		(50)		1,642		—
Other comprehensive income (loss)	—		—		—		(62)		(12)		(74)		—
Issuance (redemption) of subsidiary preferred stock	—		—		—		—		(3)		(3)		—

Stock based compensation	—		93		—		—		—		93		—

Dividends to noncontrolling interests	—		—		—		—		(50)		(50)		—
Other	—		153		(17)		—		(258)		(122)		(174)
Balance at June 30, 2022	$	15	$	27,261	$	45,554	$	(8,876)	$	4,306	$	68,260	$	115

Reference should be made to the notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

Table of Contents

GENERAL MOTORS COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Nature of Operations and Basis of Presentation

General Motors Company (sometimes referred to in this Quarterly Report on Form 10-Q as we, our, us, ourselves, the Company, General Motors or GM) designs, builds and sells trucks, crossovers, cars and automobile parts and provides software-enabled services and subscriptions worldwide. Additionally, we are investing in and growing an autonomous vehicle (AV) business. We also provide automotive financing services through General Motors Financial Company, Inc. (GM Financial). We analyze the results of our operations through the following segments: GM North America (GMNA), GM International (GMI), Cruise, and GM Financial. Cruise is our global segment responsible for the development and commercialization of AV technology. Nonsegment operations are classified as Corporate. Corporate includes certain centrally recorded income and costs such as interest, income taxes, corporate expenditures and certain nonsegment-specific revenues and expenses.

The condensed consolidated financial statements are prepared in conformity with U.S. GAAP pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The condensed consolidated financial statements include all adjustments, which consist of normal recurring adjustments and transactions or events discretely impacting the interim periods, considered necessary by management to fairly state our results of operations, financial position and cash flows. The operating results for interim periods are not necessarily indicative of results that may be expected for any other interim period or for the full year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2021 Form 10-K. Except for per share amounts or as otherwise specified, amounts presented within tables are stated in millions. Certain columns and rows may not add due to rounding.

Principles of Consolidation We consolidate entities that we control due to ownership of a majority voting interest and we consolidate variable interest entities (VIEs) when we are the primary beneficiary. All intercompany balances and transactions are eliminated in consolidation. Our share of earnings or losses of nonconsolidated affiliates is included in our consolidated operating results using the equity method of accounting when we are able to exercise significant influence over the operating and financial decisions of the affiliate.

GM Financial The amounts presented for GM Financial are adjusted to reflect the impact on GM Financial's deferred tax positions and provision for income taxes resulting from the inclusion of GM Financial in our consolidated tax return and to eliminate the effect of transactions between GM Financial and the other members of the consolidated group. Accordingly, the amounts presented will differ from those presented by GM Financial on a stand-alone basis.

Note 2. Significant Accounting Policies

The information presented on Stock Incentive Plans updates our Significant Accounting Policies information presented in our 2021 Form 10-K to reflect the effect of modifications made to Cruise stock incentive awards during the three months ended March 31, 2022. Refer to Note 18 to our condensed consolidated financial statements for additional information on the modifications made.

Stock Incentive Plans Our stock incentive plans include Restricted Stock Units (RSUs), Restricted Stock Awards (RSAs), Performance Stock Units (PSUs), stock options and awards that may be settled in our stock, the stock of our subsidiaries or in cash. We measure and record compensation expense based on the fair value of GM or Cruise's common stock on the date of grant for RSUs, RSAs and PSUs and the grant date fair value, determined utilizing a lattice model or the Black-Scholes formula for stock options and PSUs. We record compensation cost for service-based RSUs, RSAs, PSUs and service-based stock options on a straight-line basis over the entire vesting period, or for retirement eligible employees over the requisite service period. In March 2022, all outstanding RSUs that settle in Cruise’s common stock were modified to remove the liquidity vesting condition. Prospectively, RSUs that will settle in Cruise’s common stock will vest solely upon satisfaction of a service condition. Compensation cost for awards that do not have an established accounting grant date, but for which the service inception date has been established, or are settled in cash is based generally on the fair value of GM or Cruise's common stock at the end of each reporting period. Compensation cost is also recorded on stock issued to settle awards based on the fair value of Cruise's common stock until such time that the stock has been issued for more than six months. We use the graded vesting method to record compensation cost for stock options with market conditions over the lesser of the vesting period or the time period an employee becomes eligible to retain the award at retirement.

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GENERAL MOTORS COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

Accounting Standards Not Yet Adopted In March 2022, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2022-02 "Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures" (ASU 2022-02), which eliminates the accounting guidance for troubled debt restructurings (TDRs) by creditors that have adopted ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" and enhances certain disclosure requirements. The adoption of ASU 2022-02 is expected to be insignificant.

Note 3. Revenue

The following table disaggregates our revenue by major source:


	Three Months Ended June 30, 2022
	GMNA		GMI		Corporate		Total Automotive		Cruise		GM Financial		Eliminations/Reclassifications		Total
Vehicle, parts and accessories	$	27,826	$	3,466	$	22	$	31,314	$	—	$	—	$	—	$	31,314
Used vehicles	137		6		—		143		—		—		—		143
Services and other	797		336		25		1,158		25		—		(25)		1,158
Automotive net sales and revenue	28,760		3,807		47		32,614		25		—		(25)		32,614
Leased vehicle income	—		—		—		—		—		1,989		—		1,989
Finance charge income	—		—		—		—		—		1,062		—		1,062
Other income	—		—		—		—		—		95		(1)		94
GM Financial net sales and revenue	—		—		—		—		—		3,146		(1)		3,145
Net sales and revenue	$	28,760	$	3,807	$	47	$	32,614	$	25	$	3,146	$	(26)	$	35,759


	Three Months Ended June 30, 2021
	GMNA		GMI		Corporate		Total Automotive		Cruise		GM Financial		Eliminations/ Reclassifications		Total
Vehicle, parts and accessories	$	26,993	$	2,475	$	2	$	29,470	$	—	$	—	$	—	$	29,470
Used vehicles	137		13		—		150		—		—		—		150
Services and other	802		304		19		1,125		25		—		(26)		1,124
Automotive net sales and revenue	27,932		2,792		21		30,745		25		—		(26)		30,744
Leased vehicle income	—		—		—		—		—		2,304		—		2,304
Finance charge income	—		—		—		—		—		1,036		—		1,036
Other income	—		—		—		—		—		86		(3)		83
GM Financial net sales and revenue	—		—		—		—		—		3,426		(3)		3,423
Net sales and revenue	$	27,932	$	2,792	$	21	$	30,745	$	25	$	3,426	$	(29)	$	34,167



	Six Months Ended June 30, 2022
	GMNA		GMI		Corporate		Total Automotive		Cruise		GM Financial		Eliminations/Reclassifications		Total
Vehicle, parts and accessories	$	56,398	$	6,479	$	27	$	62,904	$	—	$	—	$	—	$	62,904
Used vehicles	212		11		—		223		—		—		—		223
Services and other	1,606		630		73		2,309