GM Reports Preliminary Second Quarter Financial Results

Adjusted net loss of $6.3 billion, reported net loss of $15.5 billion
Results impacted by $9.1 billion of predominantly non-cash special items
Sales records set in three of four regions
Q2 liquidity position of $21 billion, plus credit lines of additional $5 billion
Second Quarter
2008
2007*
O /(U) 2007
Revenue (bils.):
$38.2
$46.7
$(8.5)
Adjusted automotive earnings before tax (bils.):
$(4.0)
$1.0
$(5.0)
Reported automotive earnings before tax (bils.):
$(9.1)
$0.8
$(9.9)
Adjusted net income (bils.):
$(6.3)
$1.3
$(7.6)
Reported net income (bils.):
$(15.5)
$0.8
$(16.3)
Reported earnings per share (diluted):
$(27.33)
$1.37
$(28.70)
Adjusted operating cash flow (bils):
$(3.6)
$1.1
$(4.7)
* 2007 figures reflect continuing operations
DETROIT - General Motors (NYSE: GM) today announced its financial results for the second quarter of 2008, which include significant charges and special items. The reported net loss was $15.5 billion or $27.33 per share for the second quarter, including these charges and special items, compared with net income from continuing operations of $784 million or $1.37 per share in the second quarter of 2007. On an adjusted basis, GM posted a net loss of $6.3 billion or $11.21 per share, compared with net income from continuing operations of $1.3 billion or $2.29 per share in the same period last year.

GM previously announced that it anticipated a significant second quarter loss, driven in large part by costs associated with the American Axle and local U.S. strikes, and charges related to the successful U.S. hourly attrition program, actions to reduce North American truck capacity, Delphi and other matters. The operating and liquidity actions announced on July 15 contemplated weak second quarter results and a continued unfavorable U.S. environment. The company has outlined a strong cadence of product, powertrain, capacity and liquidity actions over the past 60 days, to realign the business with current U.S. economic and auto market conditions, and position the company for profitable global growth.

Some of those actions include cessation of production at four truck plants, shift reductions at two truck plants, the addition of shifts at two car plants, announcement of the new Chevrolet global small car program and next generation Chevrolet Aveo compact car, introduction of a high-efficiency 4-cylinder engine for U.S. application, salaried headcount reductions and compensation actions, deferral of certain payments to the UAW VEBA, suspension of the dividend on common stock, reductions in sales and marketing budgets, the strategic review of the Hummer brand and production funding approval for the Chevrolet Volt extended range electric vehicle.

"As our recent product, capacity and liquidity actions clearly demonstrate, we are reacting rapidly to the challenges facing the U.S. economy and auto market, and we continue to take the aggressive steps necessary to transform our U.S. operations," said GM Chairman and CEO Rick Wagoner. "We have the right plan for GM, driven by great products, building strong brands, fuel-economy technology leadership and taking full advantage of global growth opportunities."

GM's second quarter results were primarily driven by several factors: significant losses in GM North America (GMNA) due to continuing U.S. industry volume declines and shifts in vehicle mix, the long strike at American Axle and large lease-related charges; a number of special charges associated with GM's ongoing restructuring actions; continued losses at GMAC Financial Services (GMAC) and updated estimates regarding recoveries and expectations of assumed benefit obligations in the Delphi bankruptcy.

GM recorded $9.1 billion of special items, predominantly non-cash in nature for the current quarter or near-term periods, which include:

$3.3 billion relating to the 2008 GMNA hourly special attrition program
$2.8 billion adjustment to the Delphi reserve
$1.1 billion GMNA restructuring and capacity related costs
$1.3 billion impairment of GM's equity interest in GMAC
$340 million Canadian Auto Workers contract-related accounting charges
$197 million related to settlement of the strike at American Axle
Details on these and all other special items are in the financial highlights section of this release.

In addition, the GMNA adjusted net income results reflect a $1.6 billion charge related to lower residual values for off-lease vehicles. The total impact of declining residual values in GM's second quarter earnings was $2.0 billion, including impairments of lease assets at both GMAC and GM.

Revenue for the second quarter was $38.2 billion, down from $46.7 billion in the year-ago quarter, which is more than accounted for by the decline in GMNA revenues. Combined revenues for the GM Europe (GME), GM Asia Pacific (GMAP) and GM Latin America, Africa and Middle East (GMLAAM) regions were $20.8 billion, up $1.7 billion over the same period 2007.

GM reports its automotive operations and regional results on an earnings-before-tax basis, with taxes reported on a total corporate basis.

GM Automotive Operations

The second quarter adjusted automotive loss of $4.0 billion ($9.1 billion reported) reflects the losses in GMNA driven largely by volume declines including the impact of the American Axle and local strikes as well as adjustments to lease vehicle residual reserves. In addition, GMAP results were negatively impacted by adjustments relating to hedge accounting. The losses were partially offset by exceptionally strong performance in the GMLAAM region and continued profitability in GME. The loss compares with adjusted automotive earnings from continuing operations of $1 billion in the second quarter of 2007 (reported earnings of $803 million).

GM sold 2.29 million vehicles worldwide in the second quarter, down 5 percent year over year. Sales in GMNA were down 20 percent, or 236,000 units versus the year-ago period, while sales outside of North America grew by 10 percent or 116,000 units. A record 65 percent of GM unit sales for the second quarter were outside the United States. Global market share was 12.3 percent, down 0.9 percent due to weakness in North America.

GMNA

Second Quarter

2008

2007

'08 O/(U) '07

Revenue (bils.)

$19.8

$29.7

$(9.9)

Adjusted Earnings Before Tax

$(4.4) bil.

$92 mil.

$(4.5) bil.

Reported Earnings Before Tax

$(9.3) bil.

$(88) mil.

$(9.2) bil.

GM Market Share

20.2%

22.7%

(2.5) p.p.

GMNA revenue for the second quarter was $19.8 billion, down from $29.7 billion in the year-ago period. The decline was largely attributable to a markedly weaker U.S. auto market and lost production due to the work stoppage at American Axle, and at several GM facilities in May and June. Although volume overall was down 20 percent, some of GM's most recently launched cars and crossovers continue to sell especially well, including the Chevrolet Malibu and Cadillac CTS, up 113 percent and 33 percent, respectively, over the year-ago period.

GMNA adjusted results reflect significantly lower volume resulting from overall industry deterioration, continued dealer stock reductions, the negative impact of industry segment shifts, model/option mix and an increase to lease vehicle residual reserves related to declining residual values. The results also reflect favorable structural and net material cost performance and pension/OPEB/manufacturing savings.

GME

Second Quarter

2008

2007

'08 O/(U) '07

Revenue (bils.)

$10.6

$9.5

$1.1

Adjusted Earnings Before Tax (mils.)

$99

$345

$(246)

Reported Earnings Before Tax (mils.)

$20

$315

$(295)

GM Market Share

9.4%

9.4%

0 p.p

GME achieved record second-quarter sales of 590,000 units, driven by 48 percent sales growth in Russia and exceptional performance of the Chevrolet brand, which saw a 19 percent increase in sales to 137,000 units and record market share of 2.2 percent in the second quarter. Material and structural cost performance improved during the quarter. However, unfavorable exchange rates and an economic slowdown in key markets including Spain, Italy and the U.K. had a significant impact on earnings.

GMLAAM

Second Quarter

2008

2007

'08 O/(U) '07

Revenue (bils.)

$5.1

$4.3

$.8

Adjusted Earnings Before Tax (mils.)

$445

$296

$149

Reported Earnings Before Tax (mils.)

$445

$296

$149

GM Market Share

17.5%

16.8%

0.7p.p.

Improved mix, net pricing and material cost performance along with strong sales performance in key markets helped GMLAAM to improve its year-over-year earnings before tax by over 50 percent, to $445 million. Volume for the region was up nearly 18 percent over 2007, and quarterly sales records were set in Brazil, Chile, Egypt and North Africa.

GMAP

Second Quarter

2008

2007

'08 O/(U) '07

Revenue (bils.)

$5.2

$5.3

$(.1)

Adjusted Earnings Before Tax (mils.)

$(65)

$294

$(359)

Reported Earnings Before Tax (mils.)

$(163)

$280

$(443)

GM Market Share

7%

6.7%

0.3 p.p.

The second quarter earnings for GMAP reflect a $285 million pretax accounting charge related to adjusting prior FAS133 hedge accounting, partially offset by gains in India and Thailand, and improved operating performance at Australia's Holden.

GMAC

On a standalone basis, GMAC reported a net loss of $2.5 billion for the second quarter 2008. Affecting results were continuing large losses at Residential Capital, LLC (ResCap) related to asset sales, valuation adjustments and loan loss provisions, as well as a $716 million pre-tax impairment of lease assets in the automotive finance business as a result of lower used vehicle prices, particularly for SUVs. These items were partially offset by profitable results in the insurance and international auto finance businesses. GM reported an adjusted loss of $1.2 billion for the quarter attributable to GMAC, as a result of its 49 percent equity interest.

Following a first quarter impairment against its investment in GMAC, GM conducted further analysis in the second quarter to determine if additional impairments were required based on current fair value estimates. Factors considered include continued deterioration in the mortgage and consumer credit markets and a more challenging North American automotive financing environment. As a result, GM recorded impairment charges totaling $1.3 billion against its common and preferred equity interests in GMAC.

Cash and Liquidity

Reflecting the non-cash nature of many of the charges recorded in GM's reported second-quarter results, cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association (VEBA) trust totaled $21.0 billion on June 30, 2008, down from $23.9 billion on March 31, 2008. The change in liquidity reflects negative adjusted operating cash flow of $3.6 billion in the second quarter 2008, driven primarily by weaker results in GMNA. As of June 30, including undrawn, committed U.S. credit facilities of approximately $5 billion, GM has access to approximately $26 billion in liquidity. In July, GM provided notice to draw $1 billion under its secured revolving loan facility.

As announced on July 15, GM is taking operating and related actions to improve cash flow by approximately $10 billion through the end of 2009. In addition, the company has outlined plans to raise approximately $5 billion through capital markets activities and asset sales (See related news release). GM is confident that these initiatives, along with its current cash position and $4-5 billion of committed U.S. credit lines, will provide the company with ample liquidity to meet its operational needs through 2009.

Results for the second quarter of 2008 are preliminary and may be revised prior to the filing of GM's quarterly Form 10-Q in August.

# # #

Forward Looking Statements

In these and following presentations and in related comments by General Motors management, we will use words like "expect," "anticipate," "estimate," "forecast," "objective," "plan," "goal," "project," "outlook," "targets," and similar expressions to identify forward looking statements that represent our current judgments about possible future events. We believe these judgments are reasonable, but actual results may differ materially due to a variety of important factors.

Among other items, such factors include: our ability to realize production efficiencies, to reduce costs and implement capital expenditures at levels and times planned by management; market acceptance of our products; shortages of and price increases for fuel; declines in the residual values of used and off-lease vehicles; significant changes in the competitive environment and the effect of competition on our markets, including on our pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; the final results of investigations and inquiries by the SEC; court approval of the settlement agreement with the UAW and UAW retirees related to the 2007 national agreement; negotiations and bankruptcy court actions with respect to obligations owed to us by Delphi Corporation, a key supplier; possible downgrades for GMAC or ResCap by rating agencies; developments in the residential mortgage market, especially the nonprime sector; and changes in general economic conditions such as price increases or shortages of fuel, steel, or other raw materials.

GM's most recent annual report on Form 10-K and quarterly report on Form 10-Q and current reports on Form 8-K (which are incorporated by reference) provide additional information about these factors, which we may revise or supplement in future reports to the SEC on Form 10-Q or 8-K.

DEARBORN, Mich., Nov. 8, 2007 - Ford Motor Company [NYSE: F] today reported a net loss of 19 cents per share, or $380 million, for the third-quarter of 2007. This compares with a net loss of $2.79 per share, or $5.2 billion, in the third-quarter of 2006.

Ford's third-quarter revenue was $41.1 billion, up from $37.1 billion a year ago. The increase primarily reflected higher net pricing, changes in currency exchange rates, and improved product mix.

"Our third-quarter and year-to-date performance indicate that our plan is working," said Mulally. "Our full-year pre-tax outlook excluding special items is to be substantially better than 2006. We remain committed to improving our business and delivering our plan."[Ford Media]

GM Reports Third Quarter Financial Results

Record third quarter automotive revenue of $43.1 billion
Improved automotive operations on continued strength in emerging markets
Ongoing challenges in U.S. mortgage market adversely impact GM income from GMAC
$39 billion reported loss driven by $39 billion valuation allowance on deferred tax assets
Improved liquidity position of $30 billion

DETROIT - General Motors Corp. (NYSE: GM) today announced its financial results for the third quarter of 2007, marked by record global sales, further improvement in its core automotive business driven by solid financial performance in key growth markets around the world and improved liquidity.

"We continue to implement the key elements of our North America turnaround strategy, and these initiatives are driving steady improvement in our financial results, despite challenging North America market conditions. In addition, we are very encouraged by our performance in emerging markets. Our record third quarter global sales are strong evidence that our commitment to great cars and trucks is being embraced by consumers around the globe." said Rick Wagoner, GM chairman and chief executive officer.

The company's improved performance in its automotive operations was more than offset by special charges of $37.4 billion related largely to a previously announced valuation allowance against its deferred tax assets, as well as lower reported GMAC Financial Services income, down $630 million versus the year-ago quarter as a result of continued pressures in the mortgage industry.

GM reported a net loss of $39 billion (including Allison Transmission, which is classified as a discontinued operation), or $68.85 per diluted share, for the third quarter of 2007, compared with a reported net loss of $147 million, or $.26 per diluted share, in the year-ago quarter.

Special items included a net non-cash charge of $38.6 billion due to a valuation allowance against deferred tax assets related to operations in the U.S., Canada and Germany as required under SFAS No. 109, Accounting for Income Taxes. Also included was a favorable $3.5 billion after-tax gain on the sale of the Allison Transmission business in August 2007, for which GM received $5.4 billion in proceeds. GM also had special charges of $1.6 billion in pension service costs related to prior labor agreements, $0.4 billion associated with restructuring actions and $0.4 billion related to an adjustment to the Delphi reserve. Details on all of the special charges are included in the "Highlights" section of this news release.

Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter. The variance was driven primarily by a significant decline in net income at GMAC, as well as increased corporate expense related to legacy cost, foreign exchange and various 2006 tax benefits, partially offset by improved performance in automotive operations.

GM Automotive Operations

GM's global automotive operations posted net income of $122 million from continuing operations on an adjusted basis in the third quarter of 2007 (reported net loss of $40.6 billion), an improvement of $577 million compared to an adjusted net loss from continuing operations of $455 million (reported net loss of $401 million) in the same quarter 2006. Results for GM's automotive operations, specifically GMNA, exclude Allison Transmission, which was classified as a discontinued operation as a result of the sale of that business which was concluded in August 2007.

GM generated record third quarter automotive revenue of $43.1 billion. The company also achieved record global third quarter sales of 2.39 million cars and trucks, up four percent compared to the third quarter 2006, driven by exceptionally strong demand in emerging markets and improved performance in developed markets. GM also set a number of third quarter sales records around the globe, including a 22 percent increase in GMLAAM, 16 percent increase in the GMAP region, and 15 percent gain in GME.

"We continue to see solid progress in the fundamentals of our automotive business. We're very pleased with our strong sales performance in key markets outside of North America, and growing retail momentum in the U.S. driven by products like the all-new Cadillac CTS. We're also very encouraged by the early reactions to our all-new Chevrolet Malibu and 2008 Chevrolet Tahoe and GMC Yukon two-mode hybrids - the world's only full-size hybrid SUVs," said Wagoner.

GMNA had an adjusted net loss from continuing operations of $247 million in the third quarter 2007 (reported net loss from continuing operations of $38.2 billion, which includes charges of approximately $36.5 billion for a valuation allowance against its deferred tax assets and $1.3 billion for pension service costs related to prior labor agreements), compared to an adjusted net loss of $660 million from continuing operations in the third quarter 2006 (reported net loss from continuing operations of $667 million). GMNA's improved adjusted earnings reflect favorable mix, pricing and better warranty performance, which were partially offset by lower volume and increased material cost.

GME posted an adjusted net loss of $90 million in the third quarter (reported net loss of $2.9 billion, which includes charges of $2.5 billion for a valuation allowance against deferred tax assets in Germany and restructuring charges of $262 million), compared to $39 million loss in the third quarter of 2006 (reported net loss of $126 million). The variance in adjusted net income reflects the softness of the German market and unfavorable currency exchange, which was partially offset by improved pricing and higher volume.

GME achieved record third quarter sales of about 524,000 units, aided by continued momentum of GME's multi-brand strategy during the period. Chevrolet is amongst the fastest growing global vehicle brands in Europe, posting record third quarter sales of 113,000 vehicles. GM gained further ground in the growing Russian market, with sales up by 75 percent over the same quarter 2006, to a record 65,700 vehicles.

GMAP recorded adjusted net income of $138 million in the third quarter (reported net income also $138 million), compared with $57 million in the year ago period (reported net income of $205 million, which included $148 million in favorable tax-related items). This favorable earnings performance was driven largely by strong export growth from GM Daewoo, continued strong sales and profitability in China, and improved earnings in India and Australia.

GM achieved 16 percent sales growth in the Asia Pacific region, resulting in record third quarter sales of 327,500 units. GM China sold 230,000 vehicles, a 21 percent increase compared with the year ago period. GM sales in the region were also aided by the strong performance of GM Daewoo products, including the Chevrolet Captiva.

GMLAAM achieved all-time record earnings and quarterly sales in the third quarter, posting adjusted earnings of $340 million (reported net income also $340 million), up 86 percent compared with strong earnings in the year ago period of $183 million (reported net income also $183 million). The earnings improvement was driven primarily by volume growth, favorable pricing and vehicle mix.

GMLAAM set a third quarter sales record of over 329,000 vehicles, up almost 22 percent year-over-year. All-time sales records were achieved in Brazil, Colombia, Venezuela, Argentina and Egypt. The successful launch of the Chevrolet Captiva in South Africa, Venezuela, Colombia and the Middle East helped drive strong sales in the region.

GMAC

As a standalone company, GMAC Financial Services reported a net loss of $1.6 billion for the third quarter 2007, compared to a net loss of $173 million in the third quarter 2006. The reported results for the third quarter of 2007 included a $455 million goodwill impairment charge at Residential Capital, LLC (ResCap), while a goodwill impairment charge of $695 million related to GMAC Commercial Finance was reflected in results for the third quarter of 2006.

Results were dominated by the effects of the dislocation in the mortgage and credit markets on the real estate finance business, which more than offset the continued strong performance at GMAC's automotive finance, insurance and other operations.

GM recognized $757 million of the net loss attributable to GMAC as a result of its 49 percent equity interest and accrued preferred dividends (reported net loss of $803 million).

Cash and Liquidity

GM continues to have a strong liquidity position. Cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association (VEBA) trust grew to $30 billion as of September 30, 2007, up from $27.2 billion on June 30, 2007. The balance includes $5.4 billion of net cash proceeds from the completion of the Allison Transmission transaction in August 2007.

GM had negative adjusted automotive operating cash flow of $2.5 billion in the third quarter of 2007, improved from a negative $3.9 billion in the third quarter 2006.

# # #

Forward-looking Statements
In this press release and in related comments by General Motors' management our use of words like "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "seek," "may," "would," "could," "should," "believe," "potential," "continue," "designed," "impact," or the negative of any of those words or similar expressions is intended to identify forward-looking statements that represent our current judgment about possible future events. We believe these judgments are reasonable, but GM's actual results may differ materially due to a variety of important factors. Among other items, such factors include: the ability of GM to realize production efficiencies, to achieve reductions in costs as a result of the turnaround restructuring and health care cost reductions and to implement capital expenditures at levels and times planned by management; the pace of product introductions; market acceptance of our new products; significant changes in the competitive environment and the effect of competition in our markets, including on our pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; changes in the existing, or the adoption of new laws, regulations, policies, or other activities of governments, agencies, and similar organizations where such actions may affect the production, licensing, distribution, or sale of our products, the cost thereof or applicable tax rates; costs and risks associated with litigation; the final results of investigations and inquiries by the SEC and other governmental agencies; changes in accounting principles, or their application or interpretation, and our ability to make estimates and the assumptions underlying the estimates, including the range of estimates for the Delphi pension benefit guarantees, which could result in an impact on earnings; negotiations and bankruptcy court actions with respect to Delphi's obligations to GM, negotiations with respect to GM's obligations under the pension benefit guarantees to Delphi employees, and GM's ability to recover any indemnity claims against Delphi; labor strikes or work stoppages at GM or its key suppliers such as Delphi or financial difficulties at GM's key suppliers such as Delphi; completion of the final settlement with the UAW and UAW retirees, including securing class certification in a form acceptable to GM, the UAW and class counsel; completion of the final settlement with the UAW and UAW retirees, including obtaining court approval in a form acceptable to GM, the UAW, and class counsel; treatment of the terms of the 2006 Settlement Agreement pursuant to the Retiree MOU in a manner acceptable to GM, the UAW and class counsel; GM's completion of discussions with the Staff of the SEC regarding accounting treatment with respect to the New VEBA and the post-retirement medical benefits for the covered group as set forth in the Retiree MOU, on a basis reasonably satisfactory to GM; shortages of and price increases for fuel; factors affecting GMAC's results of operations and financial conditions and changes in the residential mortgage market, especially in the nonprime sector; significant changes in the competitive environment and the effect of competition in GMAC's markets, including on GMAC's pricing policies; GMAC's ability to maintain adequate financing sources; GMAC's ability to maintain an appropriate level of debt; restrictions on the ability of GMAC's residential mortgage subsidiary to pay dividends and prepay subordinated debt obligations to GMAC; changes in the residual value of off-lease vehicles; changes in U.S. government-sponsored mortgage programs or disruptions in the markets in which GMAC's mortgage subsidiaries operate; changes in GMAC's contractual servicing rights; changes in the credit ratings of GMAC or GM; and changes in economic conditions, commodity prices, currency exchange rates, or political stability in the markets in which we or GMAC operate. The most recent annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by GM and GMAC provide information about these factors, which may be revised or supplemented in future reports to the SEC on those forms.

DEARBORN, Mich., Nov. 1 - Ford Motor Company's (NYSE:F) all-new crossovers continued outpacing the competition in October, achieving their highest monthly sales to date.

In the second half of 2007, the company plans to produce 1,282,000 vehicles in North America, an increase of 2,000 vehicles from the plan announced on Sept. 4. Third-quarter actual vehicle production was 637,000 units, a reduction of 3,000 vehicles from the previously announced plan. Fourth-quarter estimated production is 645,000 units, an increase of 5,000 vehicles from the previously announced plan. [Ford Media].

"GMNA had adjusted net income from continuing operations of $78 million in the second quarter 2007 (reported net loss from continuing operations of $39 million), compared to adjusted net loss of $94 million from continuing operations (reported net loss from continuing operations of $3.95 billion) in the second quarter 2006."

GM Reports Preliminary Second Quarter Financial Results

* Record automotive revenue of $45.9 billion
* Reported net income of $891 million, adjusted net income of $1.4 billion
* Adjusted automotive operating cash flow of $1.1 billion
* Improved liquidity position of $27.2 billion

DETROIT - General Motors Corp. (NYSE: GM) today released its preliminary financial results for the 2007 second quarter, marked by record automotive revenue driven by strong sales in key growth markets, improved net income, and solid operating cash flow.

"We again saw improved results in sales, income and cash flow this quarter, driven by the continued successful implementation of our business strategies," said Rick Wagoner, GM chairman and chief executive officer. "In particular, our heavy commitment to key growth markets around the world really paid off in strong growth and earnings. In North America we continue to make progress with our focus on great new products, a disciplined sales and marketing strategy, and structural cost reduction, although profitability remains close to breakeven."

GM reported net income of $891 million, or $1.56 per diluted share, for the second quarter of 2007, an improvement of $4.3 billion compared with a reported net loss of $3.4 billion, or $5.98 per diluted share, in the year-ago quarter.

The results for the second quarter 2007 included $520 million, or $.92 per diluted share, in net special items, including $374 million in charges associated with GM's support of the bankruptcy and reorganization of Delphi and various GM North America (GMNA) restructuring-related charges. Details on the special charges are included in the "Highlights" section of this news release.

GM posted 2007 second-quarter adjusted net income, excluding special items, of $1.4 billion, or $2.48 per diluted share, compared to $1.1 billion, or $2.03 per diluted share, in the year-ago quarter.

GM Automotive Operations

GM's global automotive net income from continuing operations totaled $764 million on an adjusted basis in the second quarter of 2007 (reported net income from continuing operations of $618 million), compared to an adjusted net income of $367 million (reported net loss from continuing operations of $3.48 billion) in the second quarter 2006. Results for GM's automotive operations, specifically GMNA, exclude Allison Transmission which is now classified as a discontinued operation and an asset held for sale, pending the close of the previously-announced sale transaction.

GM's global sales volume surpassed 2.4 million units in the second quarter, up marginally from the same quarter a year ago. Global market share was down slightly at 13.3 percent, compared to 13.7 percent in the year-ago period, driven by a softer U.S. market, a reduction in fleet sales, and a disciplined incentive strategy. GM market share outside of North America increased to 9.4 percent in the second quarter 2007, compared to 9.2 percent in the second quarter 2006.

GMNA had adjusted net income from continuing operations of $78 million in the second quarter 2007 (reported net loss from continuing operations of $39 million), compared to adjusted net loss of $94 million from continuing operations (reported net loss from continuing operations of $3.95 billion) in the second quarter 2006. The net income improvements reflect favorable mix and reduced structural costs. These savings were partially offset by lower volume, favorable policy and warranty (P&W) adjustments in the prior-year period and unfavorable foreign exchange.

"It's true that our North America team has made huge improvements, and we appreciate everyone's hard work. But our current earnings clearly demonstrate we've got more to do," Wagoner said.

"We remain focused on growing revenue in North America by introducing great new cars and trucks, and enhancing our revitalized sales and marketing strategy. At the same time, we must continue to address our key areas of cost disadvantage such as healthcare. Going forward, we need to generate adequate profitability and cash flow to fund new product and key technology investments, like bio-fuel and hybrid-powered vehicles, to better position our business for sustainable growth." Wagoner added.

GM Europe (GME) posted adjusted net income of $236 million for the quarter (reported net income of $217 million), compared to $143 million in the second quarter of 2006 (reported net loss of $39 million). The results mark the best quarterly performance for GME since the second quarter of 1996. The improved earnings were driven by favorable pricing, combined with solid structural cost performance associated with the region's ongoing restructuring.

Despite industry pressures in Germany, Europe's largest vehicle market, GME set a quarterly sales record of 574,000 units, up five percent over the second quarter 2006. The new Opel Corsa small car and the Chevrolet Captiva compact SUV continued to perform especially well. In addition, GME's multi-brand strategy continues to gain momentum. Chevrolet had record sales of 115,000 units, up 34 percent. GME growth in key Eastern European markets was strong, especially in Russia, where unit sales were up 106 percent over the second quarter 2006, and share was up 3.9 percentage points.

GM Asia Pacific (GMAP) recorded adjusted net income of $237 million in the second quarter (reported net income of $227 million), which marks a second-quarter net income record for the region, and compares with $164 million in the same quarter a year ago (reported net income of $376 million, which included $212 million from the sale of GM's equity interest in Isuzu). The improvements were largely driven by strong performance at GM Daewoo and GM China. GM enjoyed eight percent sales growth in the Asia Pacific region, and GM China set a new volume record with 234,000 units in the quarter, up over six percent year-over-year. GM sales in South Korea were up 20 percent, and India was up 46 percent aided by the success of the newly-introduced Chevrolet Spark.

GM Latin America, Africa and Middle East (GMLAAM) continued to leverage explosive regional growth and its traditionally strong position in the region. GMLAAM posted its best quarterly net income in a decade with adjusted earnings of $213 million (reported net income also $213 million), compared to $155 million in the same quarter last year (reported net income of $139 million). Improvements in net income were driven primarily by volume growth and favorable pricing. GMLAAM set a volume record for the quarter, selling over 293,000 units, up 20 percent year-over-year. GM sales performance was highlighted by an all-time sales record in Venezuela, and second quarter records in Argentina, Brazil, Chile, Colombia, Egypt, and the Middle East Operations.

"As we head into the second half of the year, we're optimistic about continued growth prospects in key emerging markets. In the U.S., the economy and auto market outlook remains challenging, but we'll continue our future product and technology investments, while staying focused on growing our revenue and improving our cost competitiveness," Wagoner said. " We look forward to the U.A.W. negotiations as an opportunity to continue to address issues that are important to the company, the union and our employees."

In addition to strong year-over-year performance in automotive operations, GM also recognized adjusted net income of $401 million in Corporate Other and Other Financing (reported net income of $27 million). This represents a $517 million improvement over the second quarter 2006, principally related to reductions in income tax contingencies.

GMAC

As a standalone company, GMAC Financial Services reported net income of $293 million for the second quarter 2007, compared to $787 million in the second quarter 2006 which included a one-time gain on the sale of a regional homebuilder of $259 million. GM recognized $139 million in net income attributable to GMAC as a result of its 49 percent equity interest as well as accrued preferred dividends. Financial performance at GMAC represents a $598 million improvement over the first quarter 2007, which was significantly affected by pressures in the U.S. nonprime mortgage market.

"We're pleased that GMAC returned to profitability in the second quarter, with significantly better results than the first quarter. GMAC's auto financing and insurance businesses continues to post strong results while the company continues to progress in addressing the challenging conditions in the residential mortgage market," Wagoner said.

GMAC's automotive finance, insurance and other operations (excluding Residential Capital, LLC (ResCap)) generated more than twice the net income of these same operations in the year-ago period. Despite continued challenges in the residential mortgage industry, ResCap significantly reduced losses in the second quarter.

Cash and Liquidity

GM generated adjusted operating cash flow of $1.1 billion in the second quarter of 2007, up from $600 million in the year-ago quarter, and continues to maintain a strong liquidity position.

Cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association (VEBA) trust totaled $27.2 billion as of June 30, 2007, up from $24.7 billion on March 31, 2007. The balance includes $1.4 billion net cash raised through a convertible debt offering in May 2007, which replaced $1.1 billion in convertible debt that was redeemed in March 2007.

As announced in June 2007, the sale of the Allison Transmission business will further bolster GM's liquidity, with proceeds of approximately $5.6 billion. The sale is expected to close in the third quarter 2007.

Forward-looking Statements
In this press release and in related comments by General Motors' management, we will use words like "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "seek," "may," "would," "could," "should," "believe," "potential," "continue," "designed," or "impact" to identify forward-looking statements that represent our current judgments about possible future events. We believe these judgments are reasonable, but GM's actual results may differ materially due to a variety of important factors. Among other items, such factors include: the ability of GM to realize production efficiencies, to achieve reductions in costs as a result of the turnaround restructuring and health care cost reductions and to implement capital expenditures at levels and times planned by management; the pace of product introductions; market acceptance of the Corporation's new products; significant changes in the competitive environment and the effect of competition in the Corporation's markets, including on the Corporation's pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; changes in the existing, or the adoption of new, laws, regulations, policies or other activities of governments, agencies and similar organizations where such actions may affect the production, licensing, distribution or sale of our products, the cost thereof or applicable tax rates; costs and risks associated with litigation; the final results of investigations and inquiries by the SEC and other governmental agencies; changes in our accounting principles, or their application or interpretation, and our ability to make estimates and the assumptions underlying the estimates, including the range of estimates for the Delphi pension benefit guarantees, which could result in an impact on earnings; changes in relations with unions and employees/retirees and the legal interpretations of the agreements with those unions with regard to employees/retirees and the successful completion of a collective bargaining agreement; negotiations and bankruptcy court actions with respect to Delphi's obligations to GM, negotiations with respect to GM's obligations under the pension benefit guarantees to Delphi employees, and GM's ability to recover any indemnity claims against Delphi; labor strikes or work stoppages at GM or its key suppliers such as Delphi or financial difficulties at GM's key suppliers such as Delphi; additional credit rating downgrades and the effects thereof; factors affecting GMAC's results of operations and financial condition such as credit ratings, interest rates, the housing market(including the downturn in residential mortgages, particularly in the nonprime sector), adequate access to the capital, changes in the residual value of off-lease vehicles, changes in U.S. government-sponsored mortgage programs or disruptions in the markets in which our mortgage subsidiaries operate, and changes in GMAC's contractual servicing rights; shortages of and price increases for fuel; changes in economic conditions, commodity prices, such as steel and other raw materials, currency exchange rates or political stability in the markets in which we operate; the effects of transactions or alliances entered into by one or more of our competitors; currency exchange rates or political instability in the markets in which we operate; and general economic conditions, in particular stability of consumer confidence. The most recent annual reports on Form 10-K and quarterly reports on Form 10-Q filed by GM and GMAC provide information about these factors, which may be revised or supplemented in future reports to the SEC on those forms.

May 9, 2007 - Tokyo - TOYOTA MOTOR CORPORATION (TMC) today announced operating results for the fiscal year ended March 31, 2007.

On a consolidated basis, net revenues for the fiscal year ended March 31, 2007 totaled 23.94 trillion yen, an increase of 13.8 percent compared to the last fiscal year. Operating income increased 19.2 percent to 2.23 trillion yen, and income before income taxes, minority interest and equity in earnings of affiliated companies increased 14.1 percent to 2.38 trillion yen. Net income increased 19.8 percent to 1.64 trillion yen. All of these figures marked record highs.

Positive contributions to operating income totaled 720.0 billion yen, consisting of 330.0 billion yen from marketing efforts, 290.0 billion yen from the positive effects of changes in foreign exchange rates and 100.0 billion yen from cost reduction efforts. Negative factors totaled 359.7 billion yen.

Commenting on the results, TMC President Katsuaki Watanabe said, "For fiscal year 2007, Toyota posted record consolidated results across the board. We believe our continuous efforts to support global growth have steadily contributed to our record net revenues, operating income and net income."

TMC also announced a second-half cash dividend for the six months ended March 31, 2007 of 70 yen, an increase of 15 yen per share over the same period last fiscal year. Total dividend payout for the full year was 120 yen per share, an increase of 30 yen year-on-year. TMC has increased its annual dividend eight consecutive times.

Watanabe added, "As a result, our dividend payout ratio will improve from 21.3% to 23.4%, marking steady progress toward our 30% target".

In fiscal year 2007, Toyota's consolidated vehicle sales for the period reached 8.52 million units, an increase of 550 thousand units compared to the last fiscal year.

In Japan, vehicle sales decreased by 91 thousand units over the same period last year, to 2.27 million units. While sales of certain existing models declined, sales of the redesigned Corolla and new models such as the Auris, Blade and Lexus LS were favorable. Toyota's market share excluding mini-vehicles grew by 1.5 percent compared to the same period last year, to 45.8 percent. Operating income from Japanese operations increased by 381.3 billion yen over the same period last year, to 1.45 trillion yen, mainly due to an increase in production volume.

In North America, vehicle sales reached 2.94 million units, an increase of 386 thousand units, due to strong sales of models redesigned last year such as the RAV4 and Camry and the new models FJ Cruiser and Yaris. Operating income decreased by 46.0 billion yen, to 449.6 billion yen. This is mainly due to temporary expenses such as costs associated with the start up of the Texas plant, as well as the recording of valuation losses on interest rate swaps.

In Europe, led by strong sales of compact models such as the Yaris and Aygo, vehicle sales increased by 201 thousand units, to 1.22 million units. Operating income from European operations increased by 43.4 billion yen, to 137.3 billion yen. The increase in operating income was mainly due to strong sales of core models.

In Asia, sales decreased by 91 thousand units, to 789 thousand units, as a result of weak market conditions mainly in Indonesia and Taiwan. Operating income from Asian operations decreased by 27.9 billion yen, to 117.6 billion yen.

In other regions, including Central and South America, Oceania and Africa, vehicle sales increased to 1.29 million units, an increase of 145 thousand units, due to continuing popularity of the IMV series in Central and South America and the Camry in Oceania. Operating income in these regions increased by 16.3 billion yen, to 83.5 billion yen.

TMC estimates that the consolidated vehicle sales for the fiscal year ending March 31, 2008 will be 8.89 million units.

TMC also announced its consolidated financial forecast for the fiscal year ending March 31, 2008. Based on an exchange rate of 115 yen to the U.S. dollar and 150 yen to the euro, TMC forecasts consolidated net revenues of 25.00 trillion yen, operating income of 2.25 trillion yen and net income of 1.65 trillion yen.

Watanabe concluded by commenting on the outlook for profitability. "We aim to exceed last year's earnings by increasing sales volume and reducing cost, while investing for future growth."

(Please see attached information for details on financial results. Further information is also available on the Internet at www.toyota.co.jp)

Cautionary Statement with Respect to Forward-Looking Statements
This release contains forward-looking statements that reflect Toyota's plans and expectations. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause Toyota's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. These factors include: (i) changes in economic conditions and market demand affecting, and the competitive environment in, the automotive markets in Japan, North America, Europe and other markets in which Toyota operates; (ii) fluctuations in currency exchange rates, particularly with respect to the value of the Japanese yen, the U.S. dollar, the Euro, the Australian dollar and the British pound; (iii) Toyota's ability to realize production efficiencies and to implement capital expenditures at the levels and times planned by management; (iv) changes in the laws, regulations and government policies in the markets in which Toyota operates that affect Toyota's automotive operations, particularly laws, regulations and policies relating to trade, environmental protection, vehicle emissions, vehicle fuel economy and vehicle safety, as well as changes in laws, regulations and government policies that affect Toyota's other operations, including the outcome of future litigation and other legal proceedings; (v) political instability in the markets in which Toyota operates; (vi) Toyota's ability to timely develop and achieve market acceptance of new products; and (vii) fuel shortages or interruptions in transportation systems, labor strikes, work stoppages or other interruptions to, or difficulties in, the employment of labor in the major markets where Toyota purchases materials, components and supplies for the production of its products or where its products are produced, distributed or sold.

A discussion of these and other factors which may affect Toyota's actual results, performance, achievements or financial position is contained in Toyota's annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission.

Delphi Corp. loses $533 million in first quarter [Detroit News]

Related:
Breaking! Bankruptcy Judge Rewards Delphi Execs For Being Bankrupt [internal]

The message the General's giving on their earnings is that the NorAm operational net losses were only $46 million, an amount Rick Wagoner said this morning live on CNBC was "essentially breaking even." OK, that's a total load of crap — especially considering the automaker has sold more cars globally during the first quarter than ever before. Given that, one would assume they'd have to find a way to actually sell some cars here in NorAm to make some money — instead of producing 192,000 less — or else have a gameplan to when they're going to do that via their ever-running turnaround effort. But although Phil LeBeau's only sort of buying that spin, the bigger story is the little jam-up he may have just caused on Jefferson Avenue downtown a few minutes ago. As you can see, us Detroiters love CNBC so much we're willing to risk getting smashed up in order to gawk at pundits on the street live in front of a camera. And that's why I always talk indoors — less risk of injury to my fellow Metro Detroiters. I'm just trying to do my part. – Ray Wert

GM's CEO Says North American Operations Can Be Profitable [CNBC.com]

Related:
The Official Car Pundit Drinking Game; No Way Of The Day: GM Records First Quarter...Profits?! [internal]

GM Reports Preliminary First Quarter Financial Results

* Reported net income $62 million
* Record first quarter global sales of 2.26 million units
* Improved automotive operations, reported net income of $272 million
* Adjusted automotive operating cash flow of $300 million

DETROIT - General Motors Corp. (NYSE: GM) today announced its financial results for the first quarter of 2007. The company posted record global sales, and improved automotive profitability and operating cash flow for the quarter.

"The first quarter of 2007 marked another quarter of continued progress in GM's global automotive operations. We were able to expand vehicle sales and improve automotive profitability based on the progress in our turnaround initiatives in North America and Europe and our expansion strategy for key growth markets like China, Russia and South America," said GM Chairman and Chief Executive Officer, Rick Wagoner. "We continue to see progress on the automotive bottom line as we implement the strategies laid out two years ago."

GM reported net income of $62 million, or $0.11 per diluted share, including special items, in the first quarter of 2007, compared with net income of $602 million, or $1.06 per diluted share, in the year-ago quarter.

The decline in reported GM earnings is more than accounted for by losses in the residential mortgage business of GMAC Financial Services (GMAC), driven by continued weakness in the U.S. nonprime mortgage sector (following the 51 percent equity sale of GMAC in late 2006, GM is reporting its 49 percent ownership interest using the equity accounting method). In addition, last year's results included a one-time after tax gain of $395 million due to the sale of a portion of GM's equity ownership position in Suzuki Motors.

The reported results for the first quarter of 2007 include unfavorable special items totaling $32 million after tax, or $0.06 per diluted share, related largely to restructuring actions in Europe and Asia Pacific, offset in part by a favorable item related to workforce attrition costs for previously divested components plants. Details on the special items are included in the "Highlights" section of this news release.

Excluding special items, GM posted adjusted net income of $94 million, or $0.17 per diluted share in the first quarter of 2007, compared to adjusted net income of $350 million, or $0.62 per diluted share in the first quarter of 2006. Total revenue for the first quarter of 2007 was $43.9 billion, down from $52.4 billion, almost entirely due to GMAC revenue no longer being included in GM's consolidated results. Automotive revenue for the first quarter of 2007 was $42.9 billion, down slightly from $43.6 billion in the first quarter of 2006.

GM Automotive Operations

Net income from GM's global automotive operations totaled $304 million on an adjusted basis, in the first quarter of 2007 (reported net income of $272 million), compared to $40 million in the year-ago quarter (reported net income of $295 million).

GM sold an all-time first quarter record 2.26 million cars and trucks in the first quarter of 2007, up 3 percent, or 67,000 units, over the first quarter of 2006. Sales in the GM Asia Pacific (GMAP) region grew more than 20 percent; GM Latin America, Africa and Middle East (GMLAAM) grew 17 percent, and GM Europe (GME) grew 6 percent. GM's all-time sales record was achieved despite challenging market conditions in the U.S. largely due to volatile fuel prices and contraction in the housing market.

GM North America (GMNA) posted an adjusted loss of $85 million in the first quarter of 2007 (reported net loss of $46 million), an improvement of $166 million compared to an adjusted net loss of $251 million in the year-ago quarter (reported net loss of $292 million).

The GMNA improvement in the first quarter was mostly attributable to large structural cost savings in health care and manufacturing related expenses. GMNA also enjoyed positive product mix related to the strong acceptance of new launch products as well as GM's continued strategy to reduce its daily-rental fleet business.

GMNA was able to improve its year-over-year net income, despite a significant production reduction of 192,000 units. The volume decline reflected the disciplined implementation of the company's sales and marketing strategy, including reducing dealer inventories in the U.S. and Canada by 111,000 units as compared to year-ago levels, and reducing deliveries to daily rental companies in the U.S. and Canada by 69,000 units. Retail sales were up slightly in the U.S. for the quarter, despite challenging market conditions.

"This quarter's results again demonstrate progress in the implementation of our North America turnaround plan. They reflect major cost reductions once again, which more than offset lower volume - a function of the disciplined implementation of our product-based sales and marketing strategy," Wagoner said. "And, our newest products such as the GMC Acadia and Chevrolet Silverado have been well accepted by consumers, which gives us confidence that the most important element of our North America turnaround - product excellence - is well on track."

GME adjusted net earnings for the first quarter of 2007 amounted to $42 million (reported net income of $5 million), compared with $131 million in the first quarter of 2006 (reported net income of $59 million). The decline in net income is attributable to unfavorable product mix, material cost and lower gains on commodity hedging, which was partially offset by improved structural cost and favorable pricing.

GME set a first quarter sales record, with almost 554,000 deliveries. This marks the highest quarterly retail sales ever for the region, and the best market share performance in 10 years at 9.8 percent. And in the growing market of Russia, GM sales increased by 128 percent, outpacing the 26 percent growth in that market.

"GM Europe's record sales for the quarter reflect strong acceptance of our newest Opel/Vauxhall cars, continued progress with our multi-brand strategy - including an all-time Chevrolet Europe sales record - and strength in the key growth markets of Europe, especially Russia," Wagoner said.

GMAP posted adjusted net income of $150 million in the first quarter of 2007 (reported net income of $116 million), up from $97 million a year ago (reported net income of $492 million). Despite the loss of income from the equity sale of Suzuki, the improvement reflects an approximate 20 percent sales volume increase led by China, India and South Korea, record exports of GM-DAT products and improved performance at Holden.

GMAP revenue was up almost 35 percent, at $4.6 billion, compared with the year-ago quarter. GMAP also set all-time records in sales and market share growth, outpacing overall industry growth. Building on the strength of the well-established Buick brand, new products such as the Cadillac SLS and Chevrolet Epica are also being well received in key markets like China.

"Our strongest growth is in the Asia Pacific market, which is critically important as this will be the fastest growing region in the world over the next decade," Wagoner said. "We continue to build on our already strong footprint in China, take advantage of GM-DAT's great capabilities, and move aggressively in other important markets, like India."

Net income for GMLAAM tripled to set a new first quarter earnings record of $201 million in the first quarter of 2007, up from $67 million in the year ago period (reported net income of $40 million). The improvement in profitability was driven by very strong volume, as well as better pricing and product mix.

The sales growth in the LAAM region is consistent across all major markets, with significant gains in key Latin American countries as well as strong performance in the Middle East and South Africa. Revenue was up 13 percent over the same quarter last year, setting a new first quarter record for GMLAAM.

"GMLAAM had an extremely strong quarter, setting records in both sales and profitability, on the strength of our traditionally strong representation in this growing region. The outlook is bright for continued strong results at GMLAAM for the rest of the year, and beyond," Wagoner said.

GMAC

GMAC posted a net loss of $305 million in the first quarter of 2007, compared to net income of $495 million in the year-ago period. For the first quarter, GM recognized a net loss of $115 million associated with its 49 percent ownership of GMAC, including the accrual of dividends on GMAC preferred membership interests and certain tax benefits realized.

GMAC results were significantly impacted by a net loss of $910 million at Residential Capital, LLC (ResCap) due to continued pressures in the U.S. mortgage market. GMAC's first quarter net income generated by auto finance, insurance and other operations was $605 million, more than double the earnings generated by these same operations in the first quarter of 2006.

GMAC indicated its long-term prospects continue to look favorable based on strong business fundamentals across its automotive finance and insurance operations. In addition, GMAC indicated it anticipates a considerable improvement in ResCap's earnings performance in the second quarter this year, with losses in the U.S. residential mortgage sector expected to be at a much reduced level.

Cash and Liquidity

GM generated adjusted automotive operating cash flow of $300 million for the first quarter of 2007, an improvement of $1.5 billion year-on-year, with all four regions reporting improvement.

Cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association (VEBA) trust totaled $24.7 billion at March 31, 2007, up from $21.6 billion on March 31, 2006, but down from the year-end 2006 total of $26.4 billion.

Results for the first quarter of 2007 are preliminary and may be revised prior to the filing of GM's first quarter report on Form 10-Q in early May.

General Motors Corp. (NYSE: GM), the world's largest automaker, has been the annual global industry sales leader for 76 years. Founded in 1908, GM today employs about 280,000 people around the world. With global headquarters in Detroit, GM manufactures its cars and trucks in 33 countries. In 2006, nearly 9.1 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. More information on GM can be found at www.gm.com.

Forward-looking Statements
In this press release and in related comments by General Motors' management, we will use words like "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "seek," "may," "would," "could," "should," "believe," "potential," "continue," "designed," or "impact" to identify forward-looking statements that represent our current judgments about possible future events. We believe these judgments are reasonable, but GM's actual results may differ materially due to a variety of important factors. Among other items, such factors include: the ability of GM to realize production efficiencies, to achieve reductions in costs as a result of the turnaround restructuring and health care cost reductions and to implement capital expenditures at levels and times planned by management; the pace of product introductions; market acceptance of the Corporation's new products; significant changes in the competitive environment and the effect of competition in the Corporation's markets, including on the Corporation's pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; changes in the existing, or the adoption of new, laws, regulations, policies or other activities of governments, agencies and similar organizations where such actions may affect the production, licensing, distribution or sale of our products, the cost thereof or applicable tax rates; costs and risks associated with litigation; the final results of investigations and inquiries by the SEC and other governmental agencies; changes in our accounting principles, or their application or interpretation, and our ability to make estimates and the assumptions underlying the estimates, including the range of estimates for the Delphi pension benefit guarantees, which could result in an impact on earnings; changes in relations with unions and employees/retirees and the legal interpretations of the agreements with those unions with regard to employees/retirees and the successful completion of a collective bargaining agreement; negotiations and bankruptcy court actions with respect to Delphi's obligations to GM, negotiations with respect to GM's obligations under the pension benefit guarantees to Delphi employees, and GM's ability to recover any indemnity claims against Delphi; labor strikes or work stoppages at GM or its key suppliers such as Delphi or financial difficulties at GM's key suppliers such as Delphi; additional credit rating downgrades and the effects thereof; factors affecting GMAC's results of operations and financial condition such as credit ratings, interest rates, the housing market(including the downturn in residential mortgages, particularly in the nonprime sector), adequate access to the capital, changes in the residual value of off-lease vehicles, changes in U.S. government-sponsored mortgage programs or disruptions in the markets in which our mortgage subsidiaries operate, and changes in GMAC's contractual servicing rights; shortages of and price increases for fuel; changes in economic conditions, commodity prices, such as steel and other raw materials, currency exchange rates or political stability in the markets in which we operate; the effects of transactions or alliances entered into by one or more of our competitors; currency exchange rates or political instability in the markets in which we operate; and general economic conditions, in particular stability of consumer confidence. The most recent annual reports on Form 10-K and quarterly reports on Form 10-Q filed by GM and GMAC provide information about these factors, which may be revised or supplemented in future reports to the SEC on those forms.

8:55:49 AM: I'm coming at you live and correct from a secret, undisclosed location that may or may not be a Starbucks in Englewood Cliffs, NJ.

8:56:51 AM: I've got a venti cinnamon dolce latte with skim milk, sugar-free syrup and whipped cream (hey, the skim milk cancels that shit out!) waiting for the main man with the master plan for FoMoCo to step up to the microphone.

8:57:15 AM: Man, the MILF's here are of a significantly higher caliber than the ones I normally see at my Starbucks back home. I'm feeling a wee bit jealous...anyone seen Alan yet?

More below the jump.

9:05:16 AM: Yay it's starting! Oh wait...just tiny print on GAAP.

9:05:23 AM: Alan's starting it up to give some basics

9:05:33 AM: Down 106,000 units from last year

9:07:37 AM: Yay for having $35.2 Billion on hand! Too bad they had to mortgage the company to get that cheddar...

9:08:32 AM: According to Mulally, FoMoCo is "making progress on executing the four priorities of our plan —restructuring the Company, accelerating product development, funding our plan, and working effectively as one team"

9:09:57 AM: Is selling five businesses in one year a good thing?

9:10:19 AM: Ford, Lincoln and Mercury have reached "Toyota levels of quality"...umm...yay?

9:11:12 AM: Hey now, that was quick — we're already on to the money man — Don "Chocolate" LeClair to give us the nitty-gritty on the numbers.

9:11:31 AM: The Chief money-man Don "French Pastry" LeClair sounds really tired. Just sayin'...

9:17:49 AM: I understand the need for US automakers to get away from fleet sales, but it's still weird for me to hear Ford banging their chest over lower vehicle sales.

9:19:42 AM: They're expecting better market share overall. Really? From what products? Trucks — ok, maybe...

9:20:22 AM: Oh wait, they're expecting to continue to live life on the Edge-uh...and the dreamy Car-UV reaching higher — the Lincoln MKX.

9:21:12 AM: Ooh, great new vehicles like the...umm....Focus. Also the...umm...Ford Taurus and Taurus X? Right...and don't forget the Bullitt edition Mustang!

9:25:23 AM: They're looking to cut $5.0 billion from operating costs in 2008.

9:25:47 AM: I hope they don't pull the trick the General does where they add up their structural cost reductions for each year...

9:32:12 AM: Well that's interesting...the cash impact of the Jobs Bank and the Employee Separation Programs in the 1st quarter were only $1.2 billion. I actually expected that number to be much higher.

9:33:20 AM: Ah, now the fun stuff — "Planning Assumptions and Operational Metrics." This is where Ford tells us what the entire industry's going to do this year, and how much they think it's ok for them to suck for the entire year.

9:35:06 AM: They don't have the numbers on external quality metrics...but their internal numbers say they're reaching ToMoCo levels? Oh yeah, that's TOTALLY believable. I always think self-measurment is a great idea — probably explains why so many guys think the length of their thumb is eight inches.

9:37:45 AM: Yay! Alan's back on

9:38:24 AM: They're "on track" and "energized." Yeah, he sounds it...of course, anyone sounds "energized" today next to Don.

9:38:43 AM: Seriously — somebody bring that man a Starbucks.

9:39:48 AM: Q&A time...let's start with the analysts

9:41:58 AM: Our boy Kevin just sent us this market minder from a few minutes ago while we were in the bathroom vomiting over the size of the headcount reduction FoMoCo's taken: Ford Motor sees Q3 N. American production flat from a year ago, Q4 up (8.31 +0.43) -Update-

9:52:51 AM: Sorry zoned out there for a moment...anyone notice Ford stock is up pretty nicely in early AM trading?

10:00:49 AM: Ford of Europe has great product lines? Holy cow — really?!

10:00:54 AM: Ok, now bring them here.

10:01:03 AM: Oh wait, that would actually be a GOOD idea.

10:05:11 AM: Good question — "can you tell us how you're building higher quality vehicles — do you have any metrics on it?" The answer? "It's hard to have metrics on it...we'll just have to wait for JD Power numbers..." Umm, if that's the case, how can you say your build quality's increasing?

10:06:07 AM: Wait, why aren't they willing to break out the profitability numbers from Aston Martin? And why wouldn't they break out Jaguar?

10:06:34 AM: Oh wait, they just said all four brands did better, but "the biggest was at Land Rover."

10:09:20 AM: Sorry, had to drop some money in the meter. What did I miss? Oh yay, we're on to the media questions. First up a dead line. Second up...well, yes, we can hear you John Stoll from Dow...something.

10:09:49 AM: Thanks John for helping to explain why the line went dead a few minutes ago. You're a great American.

10:25:04 AM: Ooh, here's a good question..."how's Ford going to reduce by another 2,100 jobs to reach the numbers the plan anticipates? Will you require involuntary reductions?"

10:25:22 AM: The answer: "No significant reductions are anticipated."

10:28:01 AM: OK, there's some serious issues going on here with the conference call system.

10:28:08 AM: Is that a savings measure?

10:30:21 AM: Ok, that's all folks — thanks for joining us. Don't forget to tip the barista.

Related:
Ford's Not Dead Yet: Feeling Better In First Quarter 2007, Loses $1.1 Billion Less! [internal]

GM Reports 2006 Financial Results

* Record revenue of $207 billion in 2006
* 2006 adjusted net income of $2.2 billion - improvement of $5.4 billion
* 2006 reported net loss of $2.0 billion - improvement of $8.4 billion
* Positive fourth quarter net income and operating cash flow
* Year-end cash balance of $26.4 billion

DETROIT - General Motors Corp. (NYSE: GM) today posted net income for 2006, excluding special items, of $2.2 billion, or $3.88 per share fully diluted, compared with a net loss of $3.2 billion, or $5.67 per share, in 2005, marking a $5.4 billion improvement. Including special items, GM had a net loss of $2.0 billion, or $3.50 per share for 2006, compared with a net loss of $10.4 billion, or $18.42 per share in the year-ago period. GM earned record revenue of $207 billion in 2006, compared with $195 billion in 2005.

"We needed 2006 to be a big year, and it was," GM Chairman and CEO Rick Wagoner said. "Our performance last year reflects the significant progress we've made toward transforming GM into a more competitive, global business focused on long-term, sustainable success. The improvement is a credit to our employees, union partners, dealers and suppliers worldwide. It's also validation that our strategy is working, and faster than many people thought possible.

"But nobody at GM is declaring victory, because we all know there is still a lot more work to do to achieve our goals of steady growth, solid profitability and positive cash flow generation. We're confident that the momentum we generated in 2006 will continue to build through this year and beyond," Wagoner added.

GM's net income in the fourth quarter 2006 was $180 million, or $.32 per diluted share, excluding special items. These results compare to a net loss of $936 million, or $1.66 per share in the year ago period. Including the net favorable effect of all special items, GM's net income was $950 million, or $1.68 per diluted share in the fourth quarter of 2006, compared with a loss of $6.6 billion, or $11.63 per share in the fourth quarter of 2005. GM had revenue of $51.2 billion in the fourth quarter 2006, compared with $51.7 billion in the same period a year ago, with the decline more than accounted for by the exclusion of GMAC revenue starting December 1, 2006 , which is explained in greater detail in the "GMAC" section of the press release.

The reported results for the fourth quarter 2006 include special items totaling $770 million after tax, or $1.36 per diluted share. These are primarily attributable to gains related to GMAC transaction-related items and the sale of the GM desert proving ground property, partially offset by costs related to previously announced GM restructuring items. Additional details on these special items are included in the "Highlights" section of the press release.

GM Automotive Operations

Net income from global automotive operations for 2006 improved by more than $5.7 billion, totaling $422 million on an adjusted basis, excluding special items (reported net loss of $3.2 billion). Adjusted net income for GM's automotive operations in the fourth quarter 2006 was $228 million (reported net income of $194 million), compared with an adjusted loss of $1.2 billion in the year-ago period.

GM sold 9.1 million vehicles worldwide in 2006. For the second consecutive year, unit sales outside of the U.S. surpassed domestic sales with almost 5 million units, or 55 percent of global volume. GM Europe (GME), GM Asia Pacific (GMAP), and GM Latin America, Africa and the Middle East (GM LAAM) all set regional sales records, with GME exceeding 2 million units, GMAP topping 1.25 million units, and LAAM surpassing 1 million units for the first time.

GM North America (GMNA) posted a $5 billion earnings improvement in 2006, with an adjusted net loss of $779 million (reported net loss of $4.6 billion). In the fourth quarter of 2006, GMNA recorded its fourth consecutive quarter of more than $1 billion improvement in adjusted earnings. GMNA had an adjusted net loss of $14 million in the fourth quarter 2006 (reported net income of $50 million), versus an adjusted loss of $1.4 billion in the same quarter 2005. The calendar year improvement was realized despite a 207,000 unit reduction in GMNA production to balance inventory with deliveries, and reflects continued significant reductions in structural costs related to health care, manufacturing and workforce attrition, as well as positive sales mix and the impact of the company's product and value focused sales and marketing strategy.

GM reduced structural costs in North America by $6.8 billion in 2006, exceeding its target of $6 billion, and remains on-track to deliver the previously announced $9 billion of annual structural cost savings in 2007(versus 2005 structural cost levels). GM's progress in globalizing its product development, powertrain and manufacturing operations, combined with aggressive GMNA turnaround actions, are driving these significant structural cost reductions. GM reduced its global automotive structural cost from over 34 percent of revenue in 2005 to 30 percent of revenue in 2006, an impressive first step toward GM's goal of cutting structural cost to 25 percent of revenue by 2010.

"We made very significant progress in 2006 toward our 25 percent structural cost goal," Wagoner said. "At the same time, we continue to invest heavily in future products, technology and growth markets. GM plans to increase its global capital spending from $7.5 billion in 2006, to between $8.5 and $9 billion in 2007 and 2008."

GM's commitment to quality and design leadership was reinforced in 2006 with strong consumer and media reception to GM's newest cars and trucks, including the Chevrolet Tahoe, GMC Yukon, and Cadillac Escalade full-size utilities; GMC Sierra and Chevrolet Silverado full-size pickups; the Saturn Aura midsize sedan; Opel Corsa small car; and the Holden Commodore fullsize sedan. In addition, early public reaction to the Saturn Outlook and GMC Acadia midsize crossovers, introduced late in 2006, has been positive.

GME posted its first full year of profitability since 1999 with adjusted earnings of $227 million for 2006 (reported net loss of $225 million). GME had an adjusted loss of $8 million in the fourth quarter 2006 (reported net loss of $119 million), compared to net income of $5 million in the year-ago quarter. GME revenue in the fourth quarter 2006 was $9 billion, up from $8.1 billion in the same quarter 2005. Contributing to GME's improved performance during the year was strong revenue growth due to record volume of over 2 million units, and continued structural cost reductions.

"The actions we've taken in Europe to reduce structural cost and re-energize our product lineup is making a big impact on the business," Wagoner noted. "And our multi-brand approach in Europe is really getting traction. The Opel/Vauxhall brands are strengthening, led by products like the all-new Corsa and segment-leading Meriva and Zafira. And, the Chevrolet brand again achieved record sales, while Saab and Cadillac also demonstrated strong growth. And we're especially pleased with our progress in Russia , where GM sales grew 73 percent in 2006."

GMAP delivered adjusted earnings of $441 million in 2006 (reported net income of $1.2 billion), compared with $557 million in 2005, with the decline totally attributable to the loss of Suzuki equity income in 2006, as a result of the divestiture of most of GM's holdings in Suzuki Motor Corp. For the fourth quarter of 2006, GMAP's adjusted earnings were $122 million (reported net income of $135 million) , consistent with the same quarter 2005 earnings of $124 million. Record 2006 sales of GM Daewoo products contributed to GM's continued strong performance in the region, headlined by sales gains of 32 percent in China and 19 percent in Korea.

"The AP region remains the core of GM's global growth strategy. In 2006, GM advanced its leading position in China , again improving its market share to almost 12 percent. We also announced plans to add a new assembly plant in India to take advantage of opportunities in that important market, and we continue to grow in Korea ," Wagoner said.

GM's LAAM region delivered its best financial performance in 10 years with adjusted earnings of $533 million in 2006 (reported net income of $490 million), an improvement of $381 million over 2005. GMLAAM also recorded adjusted and reported fourth quarter earnings of $128 million, up from adjusted earnings of $63 million in the same quarter of 2005. These improvements were driven by record revenue and volume for the region, and significant gains at GM do Brasil.

"By cost-effectively leveraging GM's products and resources from around the world, GM LAAM has been able to take advantage of growth opportunities throughout the region, achieving milestone sales of over 1 million units and impressive revenue and profit results," Wagoner said.

GMAC

On a standalone basis, GMAC Financial Services reported 2006 net income of $2.1 billion, compared with net income of $2.3 billion in 2005. GMAC's operating earnings for 2006, excluding two significant items, amounted to $2.0 billion, compared to $2.7 billion of operating earnings in 2005.

For the fourth quarter of 2006, GMAC had net income of $1.0 billion, up from $112 million in the fourth quarter of 2005. The 2006 fourth quarter results include a $791 million after-tax benefit related to deferred tax liabilities that GMAC transferred to GM when GMAC converted to a Limited Liability Company (LLC). Conversely, fourth quarter 2005 results included the impact of goodwill impairment charges of $439 million after-tax. Excluding the LLC benefit, GMAC operating earnings for the fourth quarter 2006 were $225 million, compared to $551 million in the year-ago period.

On November 30, 2006, GM closed the previously-announced transaction to sell 51 percent controlling interest in GMAC to an investor consortium led by Cerberus Capital. As a result of the closing of the GMAC transaction, GMAC results through November were fully consolidated in GM's reporting, and December results were reflected on an equity income basis for GM's remaining 49 percent interest.

After adjusting GMAC results for equity income in December, dividends to GM on preferred stock and various transaction-related items, GM reported an adjusted net loss of $284 million associated with GMAC for the fourth quarter 2006, and net income of $1.5 billion for the calendar year. Going forward, GM will record GMAC results on an equity income basis.

Based on GMAC's results, GM will refund approximately $1 billion to GMAC, in the form of a capi