General Motors Company

Cybersecurity and data protection · Data breaches and cyber attacks

Security breaches and other disruptions of our in-vehicle systems could impact the safety of our customers and reduce confidence in GM and our products... hackers have reportedly attempted, and may attempt in the future, to gain unauthorized access to modify, alter and use such systems to gain control of our vehicles.

Digital transformation and innovation · Artificial intelligence and automation

Our AV strategy is dependent upon our ability to successfully mitigate unique technological, operational and regulatory risks... To the extent accidents, cybersecurity breaches or other adverse events associated with our autonomous driving systems occur, we could be subject to liability, reputational harm, government scrutiny and further regulation.

Cybersecurity and data protection · Third party data security and vendors

Security breaches and other disruptions to information technology systems and networked products, including connected vehicles, owned or maintained by us, GM Financial, or third-parties, such as vendors or suppliers, could interfere with our operations and could compromise the confidentiality of private customer data or our proprietary information.

Data and privacy · Data protection and privacy laws

Our enterprise data practices, including the collection, use, sharing and security of the Personal Identifiable Information of our customers, employees and suppliers, are subject to increasingly complex and restrictive regulations in all key market regions.

Legal and litigation · Litigation and legal proceedings

We could be materially adversely affected by unusual or significant litigation, governmental investigations or other proceedings... A negative outcome in one or more of these legal proceedings could result in the imposition of damages, including punitive damages, fines, reputational harm, civil lawsuits and criminal penalties.

Industry regulation · Regulatory compliance and changes

Our operations and products are subject to extensive laws, regulations and policies, including those related to vehicle emissions and fuel economy standards, which can significantly increase our costs and affect how we do business.

Supply chain and procurement · Raw material availability and cost volatility

High prices and uncertain availability of commodities, raw materials or other inputs used by us and our suppliers, or instability in logistics and related costs, could negatively impact our profitability... any increase in the cost of critical materials for our EV propulsion systems, including lithium, nickel, cobalt and certain rare earth metals, could lead to higher production costs.

Human capital and workforce · Talent acquisition and retention

The process of designing and developing new technology, products and services is costly and uncertain and requires extensive capital investment and the ability to retain and recruit the best talent... Failure to attract, hire, develop, motivate and retain highly qualified and diverse employees could disrupt our operations.

Core operations · Operational disruption and business continuity

Any significant disruption at one of our manufacturing facilities could disrupt our production schedule... Should these or other facilities become unavailable either temporarily or permanently for any number of reasons, including labor disruptions, supply chain disruptions, the occurrence of a contagious disease or illness, such as COVID-19, or catastrophic weather events.

Market position and competition · Pricing pressure and margin compression

We operate in a highly competitive industry that has historically had excess manufacturing capacity, and attempts by our competitors to sell more vehicles could have a significant negative effect on our vehicle pricing, market share and operating results.

Strategic execution · Joint venture and partnership risks

We benefit from many ongoing strategic business relationships, and a significant amount of our operations are conducted by joint ventures, which we cannot operate solely for our benefit... In joint ventures we share ownership and management of a company with one or more parties who may not have the same goals, strategies, priorities or resources as we do.

Strategic execution · Strategic transformation and turnaround risks

We may continue to restructure our operations in the U.S. and various other countries and initiate additional cost reduction actions, but we may not succeed in doing so... Failure to realize anticipated savings or benefits from our restructuring and/or cost reduction actions could have a material adverse effect on our business, liquidity and cash flows.

Market position and competition · Disruptive competitors and new market entrants

If we do not deliver new products, services, technologies and customer experiences in response to increased competition and changing consumer preferences in the automotive industry, our business could suffer.

Natural and catastrophic events · Climate change and environmental impact

We are subject to risks associated with climate change, including increased regulation of GHG emissions, changing consumer preferences and other risks related to our transition to EVs... Climate change regulations at the federal, state or local level or in international jurisdictions could require us to further limit emissions.

Geopolitical and trade · Trade policies tariffs and sanctions

Our business in China subjects us to unique operational, competitive and regulatory risks... Increased competition, continued U.S.-China trade tensions or weakening economic conditions in China, among other factors, may result in cost increases, price reductions, reduced sales, profitability and margins.

Natural and catastrophic events · Pandemic and public health crises

The COVID-19 pandemic and its impact on the global economy may disrupt our business and operations, which could materially adversely impact our business, financial condition, liquidity and results of operations.

Reputation and brand · Product recalls and public safety

The costs and effect on our reputation of product safety recalls and alleged defects in products and services could materially adversely affect our business... The costs to complete a recall could be exacerbated to the extent that such action relates to a global platform, such as the Chevrolet Bolt EV recall.

Market and investment · Investment portfolio performance

Our defined benefit pension plans are currently underfunded and our pension funding requirements could increase significantly due to a reduction in funded status as a result of a variety of factors, including weak performance of financial markets, declining interest rates, changes in laws or regulations.

International and currency · International operations and emerging markets

The international scale and footprint of our operations expose us to additional risks... Our global operations subject us to extensive domestic and foreign legal and regulatory requirements, and a variety of other political, economic and regulatory risks.

Market and investment · Interest rate and yield curve risk

GM Financial has certain floating-rate obligations, hedging transactions and floating-rate dealer loans that determine their applicable interest rate or payment amount by reference to the London Interbank Offered Rate (LIBOR)... the LIBOR administrator has advised that no new contracts using U.S. Dollar LIBOR should be entered into after December 31, 2021.