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- Quarterly Report (10-Q)

Date : 05/03/2012 @ 12:22PM
Source : Edgar (US Regulatory)
Stock : General Motors Company (GM)
Quote : 32.13  0.0 (0.00%) @ 6:46PM
GM share price Chart

- Quarterly Report (10-Q)


Table of Contents


UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549-1004
Form 10-Q
þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2012
OR
¨
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)
STATE OF 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) 556-5000
(Registrant’s telephone number, including area code)

Not applicable
(Former name, former address and former fiscal year, if changed since last report)

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   þ   No   ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).  Yes   þ   No   ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer   þ   Accelerated filer   ¨   Non-accelerated filer   ¨   Smaller reporting company   ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes   ¨   No   þ
As of April 27, 2012 the number of shares outstanding of common stock was 1,565,855,125 shares.

Website Access to Company's Reports

General Motors Company's internet website address is www.gm.com. Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Exchange Act are available free of charge through our website as soon as reasonably practicable after they are electronically filed with, or furnished to, the Securities and Exchange Commission.



INDEX
 
 
 
Page
PART I - Financial Information
 
Item 1.
Condensed Consolidated Financial Statements
1
 
Condensed Consolidated Income Statements (Unaudited)
1
 
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
2
 
Condensed Consolidated Balance Sheets (Unaudited)
3
 
Condensed Consolidated Statements of Equity (Unaudited)
4
 
Condensed Consolidated Statements of Cash Flows (Unaudited)
5
 
Notes to Condensed Consolidated Financial Statements
6
 
Note 1.
Nature of Operations
6
 
Note 2.
Basis of Presentation and Recent Accounting Standards
6
 
Note 3.
Acquisition of Businesses
7
 
Note 4.
Marketable Securities
8
 
Note 5.
GM Financial Finance Receivables, net
11
 
Note 6.
Securitizations
14
 
Note 7.
Inventories
14
 
Note 8.
Equity in Net Assets of Nonconsolidated Affiliates
14
 
Note 9.
Goodwill
16
 
Note 10.
Intangible Assets, net
19
 
Note 11.
Variable Interest Entities
19
 
Note 12.
Depreciation, Amortization and Impairment Charges
20
 
Note 13.
Debt
21
 
Note 14.
Product Warranty Liability
23
 
Note 15.
Pensions and Other Postretirement Benefits
24
 
Note 16.
Derivative Financial Instruments and Risk Management
25
 
Note 17.
Commitments and Contingencies
28
 
Note 18.
Income Taxes
31
 
Note 19.
Restructuring and Other Initiatives
32
 
Note 20.
Earnings Per Share
33
 
Note 21.
Stock Incentive Plans
35
 
Note 22.
Ally Financial
36
 
Note 23.
Segment Reporting
38
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
42
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
65
Item 4.
Controls and Procedures
65
PART II - Other Information
 
Item 1.
Legal Proceedings
66
Item 1A.
Risk Factors
66
Item 6.
Exhibits
67
Signature
 
68





Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES


PART I - FINANCIAL INFORMATION

Item 1 . Condensed Consolidated Financial Statements

CONDENSED CONSOLIDATED INCOME STATEMENTS
(In millions, except per share amounts)
(Unaudited)
 
Three Months Ended March 31,
 
2012
 
2011
Net sales and revenue
 
 
 
Automotive sales and revenue
$
37,328

 
$
35,899

GM Financial revenue
431

 
295

Total net sales and revenue
37,759

 
36,194

Costs and expenses
 
 
 
Automotive cost of sales
32,910

 
31,685

GM Financial operating and other expenses
248

 
165

Automotive selling, general and administrative expense
2,973

 
2,994

Other automotive expenses, net
15

 
6

Goodwill impairment charges
617

 
395

Total costs and expenses
36,763

 
35,245

Operating income
996

 
949

Automotive interest expense
110

 
149

Interest income and other non-operating income, net
275

 
604

Loss on extinguishment of debt
18

 

Income before income taxes and equity income
1,143

 
1,404

Income tax expense
216

 
137

Equity income, net of tax and gain on disposal of investments
423

 
2,144

Net income
1,350

 
3,411

Net income attributable to noncontrolling interests
(35
)
 
(45
)
Net income attributable to stockholders
$
1,315

 
$
3,366

Net income attributable to common stockholders
$
1,004

 
$
3,151

 
 
 
 
Earnings per share
 
 
 
Basic
 
 
 
Basic earnings per common share
$
0.64

 
$
2.09

Weighted-average common shares outstanding
1,572

 
1,504

Diluted
 
 
 
Diluted earnings per common share
$
0.60

 
$
1.77

Weighted-average common shares outstanding
1,692

 
1,817


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


1


Table of Contents


GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions)
(Unaudited)
 
Three Months Ended March 31,
 
2012
 
2011
 
 
 
 
Net income
$
1,350

 
$
3,411

Other comprehensive income, net of tax
 
 
 
Foreign currency translation adjustments
63

 
37

Cash flow hedging gains, net

 
23

Unrealized loss on securities
(4
)
 

Defined benefit plans, net
43

 
201

Other comprehensive income, net of tax
102

 
261

Comprehensive income
1,452

 
3,672

Less: comprehensive income attributable to noncontrolling interests
(44
)
 
(56
)
Comprehensive income attributable to stockholders
$
1,408

 
$
3,616


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


2

GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share amounts)
(Unaudited)


 
March 31, 2012
 
December 31, 2011
ASSETS
 
 
 
Current Assets
 
 
 
Cash and cash equivalents
$
17,378

 
$
16,071

Marketable securities
14,686

 
16,148

Restricted cash and marketable securities
924

 
1,005

Accounts and notes receivable (net of allowance of $390 and $331)
12,485

 
9,964

GM Financial finance receivables, net (including gross finance receivables transferred to SPEs of $3,357 and $3,295)
3,314

 
3,251

Inventories
15,844

 
14,324

Equipment on operating leases, net
2,600

 
2,464

Other current assets and deferred income taxes
1,985

 
1,696

Total current assets
69,216

 
64,923

Non-current Assets
 
 
 
Restricted cash and marketable securities
1,151

 
1,228

GM Financial finance receivables, net (including gross finance receivables transferred to SPEs of $5,742 and $5,773)
6,162

 
5,911

Equity in net assets of nonconsolidated affiliates
6,793

 
6,790

Property, net
24,275

 
23,005

Goodwill
28,433

 
29,019

Intangible assets, net
9,687

 
10,014

GM Financial equipment on operating leases, net (including assets transferred to SPEs of $373 and $274)
1,066

 
785

Other assets and deferred income taxes
3,411

 
2,928

Total non-current assets
80,978

 
79,680

Total Assets
$
150,194

 
$
144,603

LIABILITIES AND EQUITY
 
 
 
Current Liabilities
 
 
 
Accounts payable (principally trade)
$
27,576

 
$
24,551

Short-term debt and current portion of long-term debt


 


Automotive (including certain debt at GM Korea of $116 and $171; Note 11)
1,557

 
1,682

GM Financial
3,793

 
4,118

Accrued liabilities (including derivative liabilities at GM Korea of $26 and $44; Note 11)
23,651

 
22,875

Total current liabilities
56,577

 
53,226

Non-current Liabilities
 
 
 
Long-term debt


 


Automotive
3,828

 
3,613

GM Financial
5,046

 
4,420

Postretirement benefits other than pensions
6,832

 
6,836

Pensions
25,017

 
25,075

Other liabilities and deferred income taxes
12,754

 
12,442

Total non-current liabilities
53,477

 
52,386

Total Liabilities
110,054

 
105,612

Commitments and contingencies (Note 17)


 


Equity
 
 
 
Preferred stock, $0.01 par value, 2,000,000,000 shares authorized:
 
 
 
Series A (276,101,695 shares issued and outstanding (each with a $25.00 liquidation preference) at March 31, 2012 and December 31, 2011)
5,536

 
5,536

Series B (100,000,000 shares issued and outstanding (each with a $50.00 liquidation preference) at March 31, 2012 and December 31, 2011)
4,855

 
4,855

Common stock, $0.01 par value (5,000,000,000 shares authorized and 1,565,842,758 shares and 1,564,727,289 shares issued and outstanding at March 31, 2012 and December 31, 2011)
16

 
16

Capital surplus (principally additional paid-in capital)
26,334

 
26,391

Retained earnings
8,283

 
7,183

Accumulated other comprehensive loss
(5,768
)
 
(5,861
)
Total stockholders’ equity
39,256

 
38,120

Noncontrolling interests
884

 
871

Total Equity
40,140

 
38,991

Total Liabilities and Equity
$
150,194

 
$
144,603


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

3


Table of Contents


GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(In millions)
(Unaudited)  
 
Series A
Preferred
Stock
 
Series B
Preferred
Stock
 
Common Stockholders’
 
Noncontrolling
Interests
 
Total
Equity
Common
Stock
 
Capital
Surplus
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Balance December 31, 2010
$
5,536

 
$
4,855

 
$
15

 
$
24,257

 
$
266

 
$
1,251

 
$
979

 
$
37,159

Effect of adoption of amendments in ASU 2010-28 regarding goodwill impairment (Note 9)

 

 

 

 
(1,466
)
 

 

 
(1,466
)
Net income

 

 

 

 
3,366

 

 
45

 
3,411

Other comprehensive income

 

 

 

 

 
250

 
11

 
261

Purchase of noncontrolling interest shares

 

 

 
41

 

 
(7
)
 
(134
)
 
(100
)
Stock based compensation

 

 

 
49

 

 

 

 
49

Cash dividends paid on Series A Preferred Stock and cumulative dividends on Series B Preferred Stock

 

 

 

 
(215
)
 

 

 
(215
)
Dividends declared or paid to noncontrolling interest

 

 

 

 

 

 
(18
)
 
(18
)
Other

 

 

 

 

 

 
5

 
5

Balance March 31, 2011
$
5,536

 
$
4,855

 
$
15

 
$
24,347

 
$
1,951

 
$
1,494

 
$
888

 
$
39,086

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance December 31, 2011
$
5,536

 
$
4,855

 
$
16

 
$
26,391

 
$
7,183

 
$
(5,861
)
 
$
871

 
$
38,991

Net income

 

 

 

 
1,315

 

 
35

 
1,350

Other comprehensive income

 

 

 

 

 
93

 
9

 
102

Exercise of common stock warrants

 

 

 
3

 

 

 

 
3

Stock based compensation

 

 

 
(60
)
 

 

 

 
(60
)
Cash dividends paid on Series A Preferred Stock and cumulative dividends on Series B Preferred Stock

 

 

 

 
(215
)
 

 

 
(215
)
Dividends declared or paid to noncontrolling interest

 

 

 

 

 

 
(28
)
 
(28
)
Other

 

 

 

 

 

 
(3
)
 
(3
)
Balance March 31, 2012
$
5,536

 
$
4,855

 
$
16

 
$
26,334

 
$
8,283

 
$
(5,768
)
 
$
884

 
$
40,140


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


4


Table of Contents


GENERAL MOTORS COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 
Three Months Ended March 31,
 
2012
 
2011
Net cash provided by (used in) operating activities
$
2,499

 
$
(377
)
Cash flows from investing activities
 
 
 
Expenditures for property
(1,994
)
 
(1,322
)
Available-for-sale marketable securities, acquisitions
(2,368
)
 
(7,287
)
Trading marketable securities, acquisitions
(2,198
)
 
(157
)
Available-for-sale marketable securities, liquidations
4,027

 
4,262

Trading marketable securities, liquidations
1,694

 
159

Acquisition of companies, net of cash acquired
56

 
(1
)
Operating leases, liquidations
8

 
16

Proceeds from sale of business units/investments, net

 
4,805

Increase in restricted cash and marketable securities
(176
)
 
(189
)
Decrease in restricted cash and marketable securities
315

 
243

Purchases of finance receivables
(1,369
)
 
(1,135
)
Principal collections and recoveries on finance receivables
1,016

 
954

Net purchases of leased vehicles
(304
)
 
(320
)
Other investing activities
1

 
11

Net cash provided by (used in) investing activities
(1,292
)
 
39

Cash flows from financing activities
 
 
 
Net increase (decrease) in short-term debt
(146
)
 
119

Proceeds from issuance of debt (original maturities greater than three months)
2,394

 
2,141

Payments on debt (original maturities greater than three months)
(2,057
)
 
(1,714
)
Payments to acquire noncontrolling interest

 
(100
)
Dividends paid
(217
)
 
(221
)
Proceeds from issuance of stock
3

 

Other financing activities
(5
)
 
(18
)
Net cash provided by (used in) financing activities
(28
)
 
207

Effect of exchange rate changes on cash and cash equivalents
128

 
183

Net increase in cash and cash equivalents
1,307

 
52

Cash and cash equivalents at beginning of period
16,071

 
21,256

Cash and cash equivalents at end of period
$
17,378

 
$
21,308


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


5


Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




Note 1. Nature of Operations

General Motors Company, is sometimes referred to in this Quarterly Report on Form 10-Q as “we,” “our,” “us,” “ourselves,” the “Company,” “General Motors,” or “GM.” General Motors Corporation is sometimes referred to in this Quarterly Report on Form 10-Q, for the periods on or before July 9, 2009, as “Old GM.” Old GM was renamed Motors Liquidation Company (MLC), which was dissolved on December 15, 2011 and transferred its remaining assets and liabilities to the Motors Liquidation Company GUC Trust (GUC Trust).

We design, build and sell cars, trucks and automobile parts worldwide. We also provide automotive financing services primarily through General Motors Financial Company, Inc. (GM Financial).

We analyze the results of our business through our five segments: GM North America (GMNA), GM Europe (GME), GM International Operations (GMIO), GM South America (GMSA) and GM Financial. Nonsegment operations are classified as Corporate. Corporate includes investments in Ally Financial, Inc. (Ally Financial), certain centrally recorded income and costs, such as interest, income taxes and corporate expenditures and certain nonsegment specific revenues and expenses.

Note 2. Basis of Presentation and Recent Accounting Standards

The accompanying condensed consolidated financial statements have been prepared 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 accompanying condensed consolidated financial statements include all adjustments, composed of normal recurring adjustments, 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 consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011 (2011 Form 10-K) as filed with the SEC.

Use of Estimates in the Preparation of the Financial Statements

The condensed consolidated financial statements are prepared in conformity with U.S. GAAP, which requires the use of estimates, judgments and assumptions that affect the amounts of assets and liabilities at the reporting date and the amounts of revenue and expenses in the periods presented. We believe that the accounting estimates employed are appropriate and the resulting balances are reasonable; however, due to the inherent uncertainties in making estimates actual results could differ from the original estimates, requiring adjustments to these balances in future periods.

Change in Presentation of Financial Statements

In 2012 we changed the presentation of our condensed consolidated balance sheet, condensed consolidated statements of cash flows and certain footnotes to classify the assets and liabilities of GM Financial as current or non-current and to combine line items which were either of a related nature or not individually material. We have made corresponding reclassifications to the comparable information for all periods presented.

Venezuelan Exchange Regulations

Our Venezuelan subsidiaries utilize the U.S. Dollar as their functional currency because of the hyperinflationary status of the Venezuelan economy. The Venezuelan government has introduced foreign exchange control regulations which make it more difficult to convert Bolivar Fuerte (BsF) to U.S. Dollars. These regulations affect our Venezuelan subsidiaries' ability to pay non-BsF denominated obligations that do not qualify to be processed by the Venezuela currency exchange agency at the official exchange rates.

The aggregate net assets of our Venezuelan subsidiaries at March 31, 2012 and December 31, 2011 were $596 million and $438 million . At March 31, 2012 and December 31, 2011 other consolidated entities have receivables from our Venezuelan subsidiaries of $482 million and $380 million . The total amounts pending government approval for settlement at March 31, 2012 and December 31, 2011 were BsF 2.7 billion (equivalent to $633 million ) and BsF 2.3 billion (equivalent to $535 million ), for which some requests have been pending from 2007.

6

Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)


Significant Non-Cash Activity

Investing Cash Flows

The following table summarizes the amounts of non-cash property additions that have been excluded from Expenditures for property within the investing activities section of the condensed consolidated statements of cash flows because no cash has been expended (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Non-cash property additions
$
1,927

 
$
1,257


Recently Adopted Accounting Principles

In 2012 we adopted the provisions of Accounting Standards Update (ASU) 2011-05, “Presentation of Comprehensive Income” (ASU 2011-05) that requires presentation of all non-owner changes in equity in one continuous statement of comprehensive income or in two separate but consecutive statements. We elected to provide a separate statement of comprehensive income for all periods presented. The amendments in this update do not change the items that must be reported in other comprehensive income (OCI) or when an OCI item must be reclassified to net income. The adoption of ASU 2011-05 did not affect our condensed consolidated statements of financial position, results of operations and cash flows.

ASU 2011-05 was modified in December 2011 by the issuance of ASU 2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.” This update indefinitely defers certain provisions of ASU 2011-05 that require the disclosure of the amount of reclassifications of items from OCI to net income by component of net income and by component of OCI.

Note 3. Acquisition of Businesses

Acquisition of GMAC South America LLC

In March 2012 we acquired from Ally Financial for cash of $29 million 100% of the outstanding equity interests of GMAC South America LLC whose only asset is GMAC de Venezuela CA (GMAC Venezuela) comprising the business and operations of Ally Financial in Venezuela. This acquisition provides us with a captive finance offering in Venezuela which we believe is important in maintaining market position and will provide continued sources of financing for our Venezuela dealers and customers.

We recorded the fair value of the assets acquired and liabilities assumed as of March 1, 2012, the date we obtained control, and have included GMAC Venezuela's results of operations and cash flows from that date forward. The following table summarizes the amounts recorded in connection with the acquisition of GMAC Venezuela, which are included in our GMSA segment (dollars in millions):
 
March 1, 2012
Assets acquired and liabilities assumed
 
Cash
$
79

Other assets
11

Liabilities
(11
)
Bargain purchase gain
(50
)
Consideration paid
$
29


We determined the excess of net assets acquired over consideration paid was attributable to the measurement differences between the BsF denominated assets and liabilities valued using the official foreign exchange rate, as required by U.S. GAAP, and the enterprise value which has been discounted to reflect the uncertainty surrounding our ability to convert the BsF to U.S. Dollars and the risks of operating in a politically unstable country. The measurement differences do not qualify to be recorded in the

7

Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

application of the acquisition method of accounting, and we recorded the excess of net assets acquired over the consideration paid as a bargain purchase gain. The bargain purchase gain was recorded in Interest and other non-operating income, net. We did not provide pro forma financial information because we do not believe the information is material.

Acquisition of Additional GM Korea Interests

In March 2011 we completed the acquisition of an additional 6.9% interest in GM Korea Company (GM Korea) for cash of $100 million . The transaction was accounted for as an equity transaction as we retain the controlling financial interest in GM Korea. This transaction reduced our equity attributable to Noncontrolling interests by $134 million and our Accumulated other comprehensive income by $7 million and increased our Capital surplus by $41 million . We now own 77.0% of the outstanding shares of GM Korea.

Note 4. Marketable Securities

We measure the fair value of our marketable securities using a market approach where identical or comparable prices are available, and an income approach in other cases. We obtain the majority of the prices used in this valuation from a pricing service. Our pricing service utilizes industry-standard pricing models that consider various inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads and benchmark securities as well as other relevant economic measures. We conduct an annual review of valuations provided by our pricing service, which includes discussion and analysis of the inputs used by the pricing service to provide prices for the types of securities we hold. These inputs include prices for comparable securities, bid/ask quotes, interest rate yields, and prepayment spreads. Based on our review we believe the prices received from our pricing service are a reliable representation of exit prices.

The following tables summarize information regarding marketable securities (dollars in millions):

8

Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
March 31, 2012
 
 
 
Unrealized
 
Fair
 
Fair Value Measurements on a Recurring Basis
 
Cost
 
Gains
 
Losses
 
Value
 
Level 1
 
Level 2
 
Level 3
Cash and cash equivalents
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
$
5,001

 
$

 
$

 
$
5,001

 
$

 
$
5,001

 
$

Sovereign debt
380

 

 

 
380

 

 
380

 

Certificates of deposit
438

 

 

 
438

 

 
438

 

Money market funds
981

 

 

 
981

 
981

 

 

Corporate debt
5,180

 

 

 
5,180

 

 
5,180

 

Total marketable securities classified as cash equivalents
$
11,980

 
$

 
$

 
11,980

 
$
981

 
$
10,999

 
$

Cash, time deposits, and other cash equivalents
 
 
 
 
 
 
5,398

 
 
 
 
 
 
Total cash and cash equivalents
 
 
 
 
 
 
$
17,378

 
 
 
 
 
 
Marketable securities - current
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
$
3,622

 
$
1

 
$

 
$
3,623

 
$

 
$
3,623

 
$

Sovereign debt
77

 
1

 

 
78

 

 
78

 

Certificates of deposit
42

 

 

 
42

 

 
42

 

Corporate debt
4,260

 
5

 
3

 
4,262

 

 
4,262

 

Total available-for-sale securities
$
8,001

 
$
7

 
$
3

 
8,005

 

 
8,005

 

Trading securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
$
5

 
$

 
39

 
39

 

 

Sovereign debt(a)
 
 
91

 
8

 
6,565

 

 
6,565

 

Other debt
 
 
1

 

 
77

 

 
77

 

Total trading securities
 
 
$
97

 
$
8

 
6,681

 
39

 
6,642

 

Total marketable securities - current
 
 
 
 
 
 
14,686

 
39

 
14,647

 

Marketable securities - non-current
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity(b)
$
404

 
$

 
$
5

 
399

 
399

 

 

Total marketable securities - non-current
$
404

 
$

 
$
5

 
399

 
399

 

 

Total marketable securities
 
 
 
 
 
 
$
15,085

 
$
438

 
$
14,647

 
$

Restricted cash and marketable securities
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
$
1,264

 
$

 
$

 
$
1,264

 
$
1,264

 
$

 
$

Sovereign debt
16

 

 

 
16

 

 
16

 

Other
163

 

 

 
163

 

 
163

 

Total marketable securities classified as restricted cash and marketable securities
$
1,443

 
$

 
$

 
1,443

 
$
1,264

 
$
179

 
$

Restricted cash, time deposits, and other restricted cash equivalents
 
 
 
 
 
 
632

 
 
 
 
 
 
Total restricted cash and marketable securities
 
 
 
 
 
 
$
2,075

 
 
 
 
 
 
________
(a)
Unrealized gains/losses are primarily related to remeasurement of Canadian dollar (CAD) denominated securities.
(b)
Represents our seven percent ownership in Peugeot S.A. (PSA) acquired in connection with our agreement with PSA to create a long-term and broad-scale global strategic alliance. The shares are subject to certain trading restrictions until May 29, 2012. The investment is recorded in Other assets and deferred income taxes.

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
December 31, 2011
 
 
 
Unrealized
 
Fair
 
Fair Value Measurements on a Recurring Basis
 
Cost
 
Gains
 
Losses
 
Value
 
Level 1
 
Level 2
 
Level 3
Cash and cash equivalents
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
$
239

 
$

 
$

 
$
239

 
$

 
$
239

 
$

Sovereign debt
490

 

 

 
490

 

 
490

 

Certificates of deposit
2,028

 

 

 
2,028

 

 
2,028

 

Money market funds
1,794

 

 

 
1,794

 
1,794

 

 

Corporate debt
5,112

 

 

 
5,112

 

 
5,112

 

Total available-for-sale securities
$
9,663

 
$

 
$

 
9,663

 
1,794

 
7,869

 

Trading securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Sovereign debt(a)
 
 
$
8

 
$

 
497

 

 
497

 

Total trading securities
 
 
$
8

 
$

 
497

 

 
497

 

Total marketable securities classified as cash equivalents
 
 
 
 
 
 
10,160

 
$
1,794

 
$
8,366

 
$

Cash, time deposits, and other cash equivalents
 
 
 
 
 
 
5,911

 
 
 
 
 
 
Total cash and cash equivalents
 
 
 
 
 
 
$
16,071

 
 
 
 
 
 
Marketable securities - current
 
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government and agencies
$
5,214

 
$
2

 
$

 
$
5,216

 
$

 
$
5,216

 
$

Sovereign debt
143

 

 

 
143

 

 
143

 

Certificates of deposit
178

 

 

 
178

 

 
178

 

Corporate debt
4,566

 
3

 
4

 
4,565

 

 
4,565

 

Total available-for-sale securities
$
10,101

 
$
5

 
$
4

 
10,102

 

 
10,102

 

Trading securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity
 
 
$

 
$
5

 
34

 
34

 

 

Sovereign debt(a)
 
 
18

 
33

 
5,936

 

 
5,936

 

Other debt
 
 
1

 
2

 
76

 

 
76

 

Total trading securities
 
 
$
19

 
$
40

 
6,046

 
34

 
6,012

 

Total marketable securities - current
 
 
 
 
 
 
$
16,148

 
$
34

 
$
16,114

 
$

Restricted cash and marketable securities
 
 
 
 
 
 
 
 
 
 
 
 
Available-for-sale securities
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
$
1,363

 
$

 
$

 
$
1,363

 
$
1,363

 
$

 
$

Sovereign debt
15

 

 

 
15

 

 
15

 

Other
161

 
3

 

 
164

 

 
164

 

Total marketable securities classified as restricted cash and marketable securities
$
1,539

 
$
3

 
$

 
1,542

 
$
1,363

 
$
179

 
$

Restricted cash, time deposits, and other restricted cash equivalents

 
 
 
 
 
 
691

 
 
 
 
 
 
Total restricted cash and marketable securities
 
 
 
 
 
 
$
2,233

 
 
 
 
 
 
________
(a)
Unrealized gains/losses are primarily related to remeasurement of CAD denominated securities.


10

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
March 31, 2012
 
December 31, 2011
Classification of Restricted cash and marketable securities
 
 
 
Current
$
924

 
$
1,005

Non-current
1,151

 
1,228

Total restricted cash and marketable securities
$
2,075

 
$
2,233


We maintained trading securities of $84 million as compensating balances to support letters of credit of $70 million at March 31, 2012 and December 31, 2011. We have access to these securities in the normal course of business; however, the letters of credit may be withdrawn if the minimum collateral balance is not maintained.

Sales proceeds from investments in marketable securities classified as available-for-sale and sold prior to maturity were $427 million and $117 million in the three months ended March 31, 2012 and 2011.

The following table summarizes the amortized cost and the fair value of investments classified as available-for-sale within cash equivalents, marketable securities and restricted cash by contractual maturity at March 31, 2012 (dollars in millions):
 
Amortized Cost
 
Fair Value
Due in one year or less
$
16,897

 
$
16,898

Due after one year through five years
2,144

 
2,148

Total contractual maturities of available-for-sale securities
$
19,041

 
$
19,046


Note 5. GM Financial Finance Receivables, net

The following table summarizes GM Financial finance receivables, net (dollars in millions):
 
March 31, 2012
 
December 31, 2011
Current
$
3,314

 
$
3,251

Non-current
6,162

 
5,911

Total GM Financial finance receivables, net
$
9,476

 
$
9,162


The following table summarizes the components of GM Financial finance receivables, net (dollars in millions):
 
March 31, 2012
 
December 31, 2011
Pre-acquisition finance receivables, outstanding balance
$
3,675

 
$
4,366

Pre-acquisition finance receivables, carrying amount
$
3,358

 
$
4,027

Post-acquisition finance receivables, net of fees
6,326

 
5,314

Total finance receivables
9,684

 
9,341

Less: allowance for loan losses on post-acquisition finance receivables
(208
)
 
(179
)
Total GM Financial finance receivables, net
$
9,476

 
$
9,162


The following table summarizes activity for finance receivables (dollars in millions):

11

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
Three Months Ended March 31,
 
2012
 
2011
Pre-acquisition finance receivables, carrying amount, beginning of period
$
4,027

 
$
7,299

Post-acquisition finance receivables, beginning of period
5,314

 
924

Loans purchased
1,396

 
1,138

Charge-offs
(51
)
 
(2
)
Principal collections and other
(920
)
 
(852
)
Change in carrying amount adjustment on the pre-acquisition finance receivables
(82
)
 
(166
)
Balance at end of period
$
9,684

 
$
8,341


The following table summarizes the carrying amount and estimated fair value of GM Financial finance receivables, net (dollars in millions):
 
March 31, 2012
 
December 31, 2011
 
Carrying
Amount
 

Fair Value
 
Carrying
Amount
 

Fair Value
GM Financial finance receivables, net
$
9,476

 
$
9,760

 
$
9,162

 
$
9,386


GM Financial determined the fair value of finance receivables using Level 2 and Level 3 inputs within a cash flow model. The Level 3 inputs reflect assumptions regarding expected prepayments, deferrals, delinquencies, recoveries and charge-offs of the loans within the finance receivable portfolio. The cash flow model produces an estimated amortization schedule of the finance receivables which is the basis for the calculation of the series of cash flows that derive the fair value of the portfolio. The series of cash flows are calculated and discounted using a weighted-average cost of capital using unobservable debt and equity percentages, an unobservable cost of equity and an observable cost of debt based on companies with a similar credit rating and maturity and maturity profile as the portfolio. Macroeconomic factors could negatively affect the credit performance of the portfolio and therefore could potentially affect the assumptions used in our cash flow model.

GM Financial purchases finance contracts from automobile dealers without recourse, and accordingly, the dealer has no liability to GM Financial if the consumer defaults on the contract. Finance receivables are collateralized by vehicle titles and GM Financial has the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract.

At March 31, 2012 and December 31, 2011 the accrual of finance charge income has been suspended on delinquent finance receivables based on contractual amounts due of $350 million and $439 million .

GM Financial reviews its pre-acquisition portfolio for differences between contractual cash flows and the cash flows expected to be collected from its initial investment in the pre-acquisition portfolio to determine if the difference is attributable, at least, in part to credit quality. At March 31, 2012 as a result of improvements in credit performance of the pre-acquisition portfolio, which resulted in an increase of expected cash flows of $167 million , GM Financial transferred the excess non-accretable discount to accretable yield. GM Financial will recognize this excess as finance charge income over the remaining life of the portfolio.

The following table summarizes accretable yield (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Balance at beginning of period
$
737

 
$
1,201

Accretion of accretable yield
(136
)
 
(202
)
Transfer from non-accretable discount
167

 

Balance at end of period
$
768

 
$
999


The following table summarizes the allowance for post-acquisition loan losses (dollars in millions):

12

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
March 31, 2012
 
December 31, 2011
Current
$
161

 
$
136

Non-current
47

 
43

Total allowance for post-acquisition loan losses
$
208

 
$
179


The following table summarizes activity for the allowance for post-acquisition loan losses (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Balance at beginning of period
$
179

 
$
26

Provision for loan losses
48

 
39

Charge-offs
(51
)
 
(2
)
Recoveries
32

 
2

Balance at end of period
$
208

 
$
65


Credit Quality

Credit bureau scores, generally referred to as FICO scores, are determined during GM Financial's automotive loan origination process. The following table summarizes the credit risk profile of finance receivables by FICO score band, determined at origination (dollars in millions):
 
March 31, 2012
 
December 31, 2011
FICO score less than 540
$
2,371

 
$
2,133

FICO score 540 to 599
4,356

 
4,167

FICO score 600 to 659
2,598

 
2,624

FICO score greater than 660
676

 
756

Balance at end of period(a)
$
10,001

 
$
9,680

__________
(a)
Balance at end of period is the sum of pre-acquisition finance receivables - outstanding balance and post-acquisition finance receivables, net of fees.

Delinquency

The following summarizes the contractual amount of finance receivables, which is not materially different than the recorded investment, more than 30 days delinquent, but not yet in repossession, and in repossession, but not yet charged off (dollars in millions):
 
March 31, 2012
 
March 31, 2011
 
Amount
 
Percent of Contractual Amount Due
 
Amount
 
Percent of Contractual Amount Due
Delinquent contracts
 
 
 
 
 
 
 
31-to-60 days
$
318

 
3.2
%
 
$
333

 
3.8
%
Greater-than-60 days
125

 
1.2
%
 
135

 
1.5
%
Total finance receivables more than 30 days delinquent
443

 
4.4
%
 
468

 
5.3
%
In repossession
25

 
0.3
%
 
26

 
0.3
%
Total finance receivables more than 30 days delinquent and in repossession
$
468

 
4.7
%
 
$
494

 
5.6
%

An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date such

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

payment was contractually due. Delinquencies may vary from period to period based upon the average age of the portfolio, seasonality within the calendar year and economic factors.

Note 6. Securitizations

The following table summarizes securitization activity and cash flows from consolidated special purpose entities (SPEs) used for securitizations (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Receivables securitized
$
1,916

 
$
849

Net proceeds from securitization
$
1,800

 
$
800

Servicing Fees
 
 
 
Variable interest entities
$
59

 
$
49

Net Distributions from Trusts
 
 
 
Variable interest entities
$
451

 
$
143


GM Financial retains servicing responsibilities for receivables transferred to certain securitization SPEs. At March 31, 2012 and December 31, 2011 GM Financial serviced finance receivables that have been transferred to certain SPEs of $8.5 billion and $7.9 billion .

At March 31, 2012 a Canadian subsidiary of GM Financial serviced leased assets of $0.9 billion for a third party.

Note 7. Inventories

The following table summarizes the components of Inventories (dollars in millions):
 
March 31, 2012
 
December 31, 2011
Productive material, supplies and work in process
$
6,745

 
$
6,486

Finished product, including service parts
9,099

 
7,838

Total inventories
$
15,844

 
$
14,324


Note 8. Equity in Net Assets of Nonconsolidated Affiliates

Nonconsolidated affiliates are entities in which an equity ownership interest is maintained and for which the equity method of accounting is used, due to the ability to exercise significant influence over decisions relating to their operating and financial affairs.

The following table summarizes information regarding Equity income, net of tax and gain on disposal of investments (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
China JVs
$
419

 
$
448

New Delphi (including gain on disposition)

 
1,727

Others
4

 
(31
)
Total equity income, net of tax and gain on disposal of investments
$
423

 
$
2,144


We received dividends from nonconsolidated affiliates of $21 million and $0 in the three months ended March 31, 2012 and 2011. At March 31, 2012 and December 31, 2011 we had undistributed earnings including dividends declared but not received of $2.0 billion and $1.6 billion related to our nonconsolidated affiliates.


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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

Investment in China JVs

The following table summarizes our direct ownership interests in our Chinese joint ventures, collectively referred to as China JVs:
 
March 31, 2012
 
March 31, 2011
Shanghai General Motors Co., Ltd. (SGM)
49
%
 
49
%
Shanghai GM Norsom Motor Co., Ltd. (SGM Norsom)
25
%
 
25
%
Shanghai GM Dong Yue Motors Co., Ltd. (SGM DY)
25
%
 
25
%
Shanghai GM Dong Yue Powertrain (SGM DYPT)
25
%
 
25
%
SAIC-GM-Wuling Automobile Co., Ltd. (SGMW)
44
%
 
44
%
FAW-GM Light Duty Commercial Vehicle Co., Ltd. (FAW-GM)
50
%
 
50
%
Pan Asia Technical Automotive Center Co., Ltd.
50
%
 
50
%
Shanghai OnStar Telematics Co., Ltd. (Shanghai OnStar)
40
%
 
40
%
Shanghai Chengxin Used Car Operation and Management Co., Ltd. (Shanghai Chengxin Used Car)
33
%
 
33
%
SAIC General Motors Sales Co., Ltd. (SGMS)
49
%
 



Sales and income of our China JVs are not consolidated into our financial statements; rather, our proportionate share of the earnings of each joint venture is reflected as Equity income, net of tax and gain on disposal of investments.

SGM is a joint venture established in 1997 by Shanghai Automotive Industry Corporation (SAIC) ( 51% ) and us ( 49% ). SGM has interests in three other joint ventures in China: SGM Norsom, SGM DY and SGM DYPT. These three joint ventures are jointly held by SGM ( 50% ), SAIC ( 25% ) and us ( 25% ). These four joint ventures are engaged in the production, import, and sale of a comprehensive range of products under the brands of Buick, Chevrolet and Cadillac. SGM also has interests in Shanghai OnStar ( 20% ) and Shanghai Chengxin Used Car ( 33% ).

SGMS is a joint venture established in November 2011 by SAIC ( 51% ) and us ( 49% ) to engage in the sales of the imported brands of Buick, Chevrolet and Cadillac and the sales of automobiles manufactured by SGM.

Sale of New Delphi

In March 2011 we sold our Class A Membership Interests in Delphi Automotive LLP (New Delphi) to New Delphi for $3.8 billion . The Class A Membership Interests sold represented 100% of our direct and indirect interests in New Delphi and 100% of New Delphi's Class A Membership Interests issued and outstanding. The sale terminated any direct and indirect obligation to loan New Delphi up to $500 million under a term loan facility established in October 2009 when New Delphi was created and the Class A Membership Interests were issued. New Delphi had not borrowed under this loan facility. In March 2011 we recorded a gain of $1.6 billion related to the sale in Equity income, net of tax and gain on disposal of investments. Our existing supply contracts with New Delphi were not affected by this transaction.

Investment in HKJV

In March 2011 the fair value of our investment in SAIC GM Investment Limited (HKJV) was determined to be less than its carrying amount. HKJV is our joint venture which controls our automotive operations in India. The loss in value was determined to be other than temporary and, therefore, we recorded an impairment charge of $39 million in the three months ended March 31, 2011. In addition we recorded other charges totaling $67 million related to our investment in the HKJV.

We have provided SAIC Motor Hong Kong Investment Limited (SAIC-HK), a 50% equity holder in HKJV, an option to not participate in future capital injections, which would otherwise be required under certain circumstances. Upon election to exercise the option SAIC-HK would be relieved from providing up to $173 million in future capital injections. The related option liability was $88 million and total unrealized losses were $64 million at March 31, 2012 and December 31, 2011.

A Monte Carlo option-pricing model was used to estimate the fair value of the option liability which is a Level 3 measure. The

15

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

key inputs into the option pricing model were the expected volatility, risk-free rate, expected term, fair value of HKJV and expected amounts of the future funding requirement. The fair value estimate of the option is most sensitive to the fair value of HKJV, which is unobservable. A discounted cash flow methodology was utilized to estimate the fair value of HKJV. A decrease in the fair value of HKJV will result in an increase in the fair value of the option liability.

Transactions with Nonconsolidated Affiliates

Nonconsolidated affiliates are involved in various aspects of the development, production and marketing of cars, trucks and automobile parts. We purchase component parts and vehicles from certain nonconsolidated affiliates for resale to dealers. The following tables summarize the effects of transactions with nonconsolidated affiliates (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Results of Operations
 
 
 
Automotive sales and revenue
$
583

 
$
835

Automotive purchases, net
$
103

 
$
792

Automotive selling, general and administrative expense
$
2

 
$
8

Automotive interest expense
$
6

 
$
5

Interest income and other non-operating income (expense), net
$
15

 
$
(2
)

 
March 31, 2012
 
December 31, 2011
Financial Position
 
 
 
Accounts and notes receivable, net
$
2,167

 
$
1,785

Accounts and notes payable
$
347

 
$
342

Deferred revenue and customer deposits
$
154

 
$
150


 
Three Months Ended March 31,
 
2012
 
2011
Cash Flows
 
 
 
Operating
$
563

 
$
63

Investing
$
(37
)
 
$


Note 9. Goodwill
The following tables summarize the changes in the carrying amounts of Goodwill (dollars in millions):
 
GMNA
 
GME
 
GMIO
 
GMSA
 
Total
Automotive
 
GM
Financial
 
Total
Balance at January 1, 2012
$
26,399

 
$
581

 
$
610

 
$
151

 
$
27,741

 
$
1,278

 
$
29,019

Impairment charges

 
(590
)
 
(27
)
 

 
(617
)
 

 
(617
)
Effect of foreign currency translation and other
1

 
9

 
15

 
6

 
31

 

 
31

Balance at March 31, 2012
$
26,400

 
$

 
$
598

 
$
157

 
$
27,155

 
$
1,278

 
$
28,433

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated impairment charges at December 31, 2011
$

 
$
(2,482
)
 
$
(270
)
 
$

 
$
(2,752
)
 
$

 
$
(2,752
)
Accumulated impairment charges at March 31, 2012
$

 
$
(3,072
)
 
$
(297
)
 
$

 
$
(3,369
)
 
$

 
$
(3,369
)


16

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

We adopted the provisions of ASU 2010-28 "When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts" (ASU 2010-28) on January 1, 2011 and performed Step 2 of the goodwill impairment testing analysis for our GME reporting unit which had a negative carrying amount resulting in the recognition of a cumulative-effect adjustment to Retained earnings. GME continued to have a negative carrying amount and because it was more likely than not further goodwill impairment existed at March 31, 2012 and 2011 we recorded further Goodwill impairment charges in the three months ended March 31, 2012 and 2011.

In the three months ended March 31, 2012 we determined that the carrying amount for our GM Korea reporting unit continued to exceed its fair value and that goodwill impairment existed. We recorded a Goodwill impairment charge in the three months ended March 31, 2012 within our GMIO segment.
The following tables summarize the Goodwill impairment charges recorded in the three months ended March 31, 2012 and 2011 (dollars in millions):
 
Three Months Ended March 31, 2012
 
GMNA
 
GME
 
GMIO
 
GMSA
 
Total
Automotive
 
GM
Financial
 
Total
Impairment charges
$

 
$
590

 
$
27

 
$

 
$
617

 
$

 
$
617


 
Three Months Ended March 31, 2011
 
GMNA
 
GME
 
GMIO
 
GMSA
 
Total
Automotive
 
GM
Financial
 
Total
Effect of Adoption of
  ASU 2010-28(a)
$

 
$
1,466

 
$

 
$

 
$
1,466

 
$

 
$
1,466

Impairment charges

 
395

 

 

 
395

 

 
395

Total impairment of goodwill
$

 
$
1,861

 
$

 
$

 
$
1,861

 
$

 
$
1,861

_________
(a)
Impairment charges of $1.5 billion were recorded as a cumulative-effect adjustment to beginning Retained earnings upon the adoption of ASU 2010-28.

The Goodwill impairment charges recorded as a result of the initial adoption of ASU 2010-28 in the three months ended March 31, 2011 and the event-driven goodwill impairment tests in the three months ended March 31, 2012 and 2011 represent the net decreases in implied goodwill resulting primarily from decreases in the fair value-to-U.S. GAAP differences attributable to those assets and liabilities that gave rise to goodwill upon our application of fresh-start reporting, as discussed in Note 32 to our consolidated financial statements in our 2011 Form 10-K. The net decreases resulted primarily from a decrease in our nonperformance risk and an improvement in our incremental borrowing rates since July 10, 2009. At certain of the testing dates the net decrease also resulted from an increase in the high quality corporate bond rates utilized to measure our employee benefit obligations and a decrease in credit spreads between high quality corporate bond rates and market interest rates for companies with similar nonperformance risk. In addition, for the purpose of deriving an implied goodwill balance, deterioration in the business outlook for GME resulted in a reduction in the fair value of certain tax attributes and an increase in the fair value of estimated employee benefit obligations.

When performing our goodwill impairment testing, the fair values of our reporting units were determined based on valuation techniques using the best available information, primarily discounted cash flow projections. We make significant assumptions and estimates about the extent and timing of future cash flows, growth rates, market share and discount rates that represent unobservable inputs into our valuation methodologies. The cash flows are estimated over a significant future period of time, which makes those estimates and assumptions subject to a high degree of uncertainty. Where available and as appropriate, comparative market multiples and the quoted market price of our common stock are used to corroborate the results of the discounted cash flow method. Assumptions used in our discounted cash flow analysis that have the most significant effect on the estimated fair values of our reporting units include:

Our estimated weighted-average cost of capital (WACC);
Our estimated long-term growth rates; and
Our estimate of industry sales and our market share.

17

Table of Contents
GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)


The valuation methodologies utilized to perform our goodwill impairment testing were consistent with those used in our application of fresh-start reporting on July 10, 2009 and in subsequent annual or event-driven goodwill impairment tests and utilized Level 3 measures. Because the fair value of goodwill can be measured only as a residual amount and cannot be determined directly we calculated the implied goodwill for GME and GM Korea in the same manner that goodwill is recognized in a business combination pursuant to Accounting Standards Codification (ASC) 805, "Business Combinations." The valuations used in our goodwill impairment testing are reviewed internally by personnel with appropriate expertise and, when deemed necessary, third party specialists are utilized to assist in deriving certain unobservable inputs and/or calculating certain fair value estimates.

The following table summarizes the Goodwill balances and key assumptions, which are unobservable, utilized for each of our reporting units that required a Step 2 analysis (dollars and vehicles in millions):
 
 
 
 
 
 
 
Industry Sales(a)(b)
 
Market Share(a)(b)
 
Goodwill(c)
 
WACC
 
Long-Term Growth Rates
 
2011/2012
 
2015/2016
 
2011/2012
 
2015/2016
GME - At January 1, 2011
$
3,053

 
17.0
%
 
0.5
%
 
18.4
 
22.0
 
6.6
%
 
7.4
%
GME - At March 31, 2011
$
1,661

 
16.5
%
 
0.5
%
 
18.4
 
22.0
 
6.6
%
 
7.4
%
GME - At March 31, 2012
$
594

 
17.5
%
 
0.5
%
 
19.1
 
21.9
 
6.2
%
 
6.3
%
GM Korea - At March 31, 2012
$
564

 
14.8
%
 
3.0
%
 
81.0
 
97.1
 
1.4
%
 
1.1
%
_________
(a)
Industry sales and market share for GM Korea are based on global industry volumes because GM Korea exports vehicles globally.
(b)
GME amounts at January 1, 2011 and March 31, 2011 are 2011 through 2015 and GME amounts at March 31, 2012 are 2012 through 2016. GM Korea amounts are 2012 through 2015.
(c)
Goodwill balance is before any adjustments for Goodwill impairment charges.

The WACCs considered various factors including bond yields, risk premiums and tax rates; the terminal values were determined using a growth model that applied a reporting unit's long-term growth rate to its projected cash flows beyond the forecast period; and industry sales and a market share for each reporting unit included annual estimates through the forecast period. In addition, minimum operating cash needs that incorporate specific business, economic and regulatory factors giving rise to varying cash needs were estimated.

During our Step 2 analyses we determined the fair values of these reporting units had not increased sufficiently to give rise to implied goodwill other than the goodwill arising from the fair value-to-U.S. GAAP differences attributable to those assets and liabilities that gave rise to goodwill upon our application of fresh-start reporting. On our testing dates our Step 2 analyses indicated GME's and GM Korea's implied goodwill was less than their recorded goodwill; therefore, Goodwill was adjusted at the various dates indicated in the table above.

Future goodwill impairments that may be material could be recognized should the recent economic uncertainty continue, our equity price decline on a sustained basis, global economies enter into another recession and industry growth stagnates, or should we release deferred tax asset valuation allowances in certain tax jurisdictions (which could occur in the near future if additional positive evidence becomes available).

In these circumstances future goodwill impairments would largely be affected by decreases in the fair value-to-U.S. GAAP differences that have occurred subsequent to our application of fresh-start reporting. The decrease may occur upon: (1) an improvement in our credit rating; (2) a decrease in credit spreads between high quality corporate bond rates and market interest rates thus resulting in a decrease in the spread between our employee benefit related obligations under U.S. GAAP and their fair values; and/or (3) a change in the fair values of our estimated employee benefit obligations. A decrease would also occur upon reversal of our deferred tax asset valuation allowances. Any decreases in the fair value-to-U.S. GAAP differences that result in goodwill impairment would have a negative effect on our earnings that could be material.

Our fair value estimates for event-driven impairment tests assume the achievement of the future financial results contemplated in our forecasted cash flows and there can be no assurance that we will realize that value. The estimates and assumptions used are subject to significant uncertainties, many of which are beyond our control, and there is no assurance that anticipated financial results will be achieved.


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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

Note 10. Intangible Assets, net

The following table summarizes the components of Intangible assets, net (dollars in millions):
 
March 31, 2012
 
December 31, 2011
 
 
Gross
Carrying
Amount
 

Accumulated
Amortization
 
Net
Carrying
Amount
 
Gross
Carrying
Amount
 

Accumulated
Amortization
 
Net
Carrying
Amount
Technology and intellectual property
 
$
7,763

 
$
5,393

 
$
2,370

 
$
7,751

 
$
5,081

 
$
2,670

Brands
 
5,440

 
414

 
5,026

 
5,410

 
374

 
5,036

Dealer network and customer relationships
 
2,169

 
354

 
1,815

 
2,138

 
322

 
1,816

Favorable contracts
 
519

 
220

 
299

 
514

 
200

 
314

Other
 
17

 
15

 
2

 
17

 
14

 
3

Total amortizing intangible assets
 
15,908

 
6,396

 
9,512

 
15,830

 
5,991

 
9,839

Non amortizing in process research and development
 
175

 


 
175

 
175

 


 
175

Total intangible assets
 
$
16,083

 
$
6,396

 
$
9,687

 
$
16,005

 
$
5,991

 
$
10,014


Amortization expense related to intangible assets was $398 million and $503 million in the three months ended March 31, 2012 and 2011.

The following table summarizes estimated amortization expense related to intangible assets in each of the next five years (dollars in millions):
 
Estimated Amortization
Expense
2013
$
1,229

2014
$
611

2015
$
313

2016
$
314

2017
$
311


Note 11. Variable Interest Entities

Consolidated VIEs

Automotive

Variable interest entities (VIEs) that we do not control through a majority voting interest that are consolidated because we are the primary beneficiary include certain vehicle assembling, manufacturing and selling venture arrangements, the most significant of which is GM Egypt. At March 31, 2012 and December 31, 2011: (1) Total assets recognized for these consolidated VIEs were $493 million and $463 million , which were comprised of Cash and cash equivalents, Accounts and notes receivables, net, Inventories and Property, net; and (2) Total liabilities were $309 million and $298 million , which were comprised of Accounts payable (principally trade) and Accrued and other liabilities. Liabilities recognized as a result of consolidating VIEs generally do not represent claims against us or our other subsidiaries and assets recognized generally are for the benefit of the VIEs' operations and cannot be used to satisfy our obligations. In the three months ended March 31, 2012 and 2011 Total net sales and revenue recorded for these consolidated VIEs were $236 million and $110 million and Net income (loss) was $(5) million and $3 million .

GM Korea, a non-wholly owned consolidated subsidiary that we control through a majority voting interest, is also a VIE because in the future it may require additional subordinated financial support. The creditors of GM Korea's short-term debt of $116 million and $171 million , current derivative liabilities of $26 million and $44 million and long-term debt of $6 million and $7 million at March 31, 2012 and December 31, 2011 do not have recourse to our general credit. In February 2011 we provided a guarantee to a minority shareholder in GM Korea to repurchase GM Korea's preferred shares according to the redemption schedule should GM Korea not repurchase the shares. This guarantee decreased the amount of long-term debt which did not have recourse to our general credit in the three months ended March 31, 2011.

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)


Automotive Financing - GM Financial

GM Financial finances its loan and lease origination volume through the use of credit facilities and securitization trusts that issue asset-backed securities to investors. GM Financial retains a residual interest in these entities and is not required to provide any additional financial support to its sponsored credit facilities and securitization SPEs. The SPEs are considered VIEs because they do not have sufficient equity at risk and are consolidated because GM Financial has the power over those activities that most significantly affect the economic performance of the SPEs. The finance receivables, leased assets and other assets held by these subsidiaries are not available to our creditors or creditors of our other subsidiaries. Refer to Notes 5 , 6 and 13 for additional information on GM Financial's involvement with the SPEs.

Nonconsolidated VIEs

Automotive

VIEs that are not consolidated include certain vehicle assembling, manufacturing and selling venture arrangements and other automotive related entities to which we provided financial support including Ally Financial and HKJV. We concluded these entities are VIEs because they do not have sufficient equity at risk or may require additional subordinated financial support. We currently lack the power through voting or similar rights to direct those activities of these entities that most significantly affect their economic performance. Our variable interests in these nonconsolidated VIEs include accounts and notes receivable, equity in net assets, guarantees and financial support, some of which were provided to certain current or previously divested suppliers in order to ensure that supply needs for production were not disrupted due to a supplier's liquidity concerns or possible shutdowns.

The following table summarizes the amounts recorded for nonconsolidated VIEs and the related off-balance sheet guarantees and maximum exposure to loss, excluding Ally Financial that is disclosed in Note 22 (dollars in millions):

 
March 31, 2012
 
December 31, 2011
 
Carrying Amount
 
Maximum Exposure to Loss
 
Carrying Amount
 
Maximum Exposure to Loss
Assets
 
 
 
 
 
 
 
Accounts and notes receivable, net
$
8

 
$
8

 
$
1

 
$
1

Equity in net assets of nonconsolidated affiliates
193

 
189

 
190

 
186

Other assets
1

 
1

 
1

 
1

Total assets
$
202

 
$
198

 
$
192

 
$
188

 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
Other liabilities
$
197

 
 
 
$
198

 
 
 
 
 
 
 
 
 
 
Off-Balance Sheet
 
 
 
 
 
 
 
Loan commitments
 
 
$
15

 
 
 
$
15

Other liquidity arrangements(a)
 
 
227

 
 
 
220

Total off-balance sheet arrangements
 
 
$
242

 
 
 
$
235

__________
(a)
Amounts at March 31, 2012 and December 31, 2011 represented additional contingent future capital funding requirements related to HKJV.

Refer to Note 22 for additional information on Ally Financial, including our maximum exposure to loss under agreements with Ally Financial and our recorded investment in Ally Financial. Refer to Note 8 for additional information on our investment in HKJV.

Note 12. Depreciation, Amortization and Impairment Charges


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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

The following table summarizes depreciation, amortization and impairment charges related to Property, net, Equipment on operating leases, net and GM Financial equipment on operating leases, net (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Depreciation and amortization of long-lived assets
$
892

 
$
928

Impairment charges of long-lived assets(a)
$
31

 
$
26

Depreciation of equipment on operating leases
$
92

 
$
80

Impairment charges of equipment on operating leases
$
55

 
$
39

__________
(a)
The fair value of related assets was determined to be $0 in the three months ended March 31, 2012 and 2011 measured utilizing Level 3 inputs. Fair value measurements of long-lived assets utilized projected cash flows discounted at a rate commensurate with the perceived business risks related to the assets involved.

The following table summarizes equipment on operating leases to daily rental car companies measured at fair value using Level 3 inputs on a nonrecurring basis (dollars in millions):
 
 
 
Fair Value Measurements on a Nonrecurring Basis
 
Fair Value Measures
 
Level 1
 
Level 2
 

Level 3
Three months ended March 31, 2012
$
937

 
$

 
$

 
$
937

Three months ended March 31, 2011
$
926

 
$

 
$

 
$
926


Impairment of vehicles leased to daily rental car companies with guaranteed repurchase obligations is determined to exist if the expected cash flows are lower than the carrying amount of the vehicle. We have multiple, distinct portfolios of vehicles leased to rental car companies and may have multiple impairments within a period. Expected cash flows include all estimated net revenue and costs associated with the sale to daily rental car companies through disposal at auction. The fair value measurements are determined, reviewed and approved on a monthly basis by personnel with appropriate knowledge of transactions with daily rental car companies and auction transactions.

The following table summarizes the significant quantitative unobservable inputs and assumptions used in the fair value measurement of Equipment on operating leases, net in the three months ended March 31, 2012 (dollars in millions):
 
Valuation Technique
 
Significant Unobservable Input
 
Amount
Impaired equipment on operating leases
Cash flow
 
Estimated net revenue
 
$
960

 
 
 
Estimated cost
 
$
1,015


Note 13. Debt

Automotive

The following table summarizes the carrying amount and fair value of debt (dollars in millions):


March 31, 2012

December 31, 2011
Carrying amount
$
5,385

 
$
5,295

Fair value(a)
$
5,865

 
$
5,467

__________
(a)
The fair value of debt included $4.7 billion measured utilizing Level 2 inputs and $1.2 billion measured utilizing Level 3 inputs at March 31, 2012. The fair value of debt included $4.4 billion measured utilizing Level 2 inputs and $1.1 billion measured utilizing Level 3 inputs at December 31, 2011

The Level 2 fair value measurements utilize a discounted cash flow model. The valuation is reviewed internally by personnel with appropriate expertise in valuation methodologies. This model utilizes observable inputs such as contractual repayment terms and benchmark forward yield curves plus a spread that is intended to represent our nonperformance risk for secured or unsecured

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

obligations. We estimate our nonperformance risk using our corporate credit rating, the rating on our secured revolver, yields on traded bonds of companies with comparable credit ratings and risk profiles. We acquire the benchmark yield curves and nonperformance risk spread from independent sources that are widely used in the financial industry. In certain circumstances, we adjust the valuation of debt for additional nonperformance risk or potential prepayment probability scenarios. We may use a probability weighting of prepayment scenarios when the stated rate exceeds market rates and the instrument contains prepayment features. The prepayment scenarios are adjusted to reflect the views of market participants. The fair value measurements subject to additional adjustments for nonperformance risk or prepayment have been categorized within Level 3.

In the three months ended March 31, 2012 we prepaid and retired a debt obligation of $39 million with a carrying value of $21 million . We recorded a loss on extinguishment of debt of $18 million which primarily represented the unamortized debt discount.

Automotive Financing - GM Financial

The following table summarizes the current and non-current portion of debt (dollars in millions):

March 31, 2012

December 31, 2011
Short-term debt and current portion of long-term debt
$
3,793


$
4,118

Long-term debt
5,046


4,420

Total GM Financial debt
$
8,839


$
8,538


The following table summarizes the carrying amount and fair value of debt (dollars in millions):
 
 
 
March 31, 2012
 
December 31, 2011
 
Level
 
Carrying Amount
 

Fair Value
 
Carrying Amount
 

Fair Value
Credit facilities
 
 
 
 
 
 
 
 
 
Medium-term note facility
3
 
$
254

 
$
254

 
$
294

 
$
294

Syndicated warehouse facility
2
 
277

 
277

 
621

 
621

Lease funding facilities
2
 
248

 
248

 
181

 
181

Bank funding facility
2
 

 

 
3

 
3

Total credit facilities
 
 
779

 
779

 
1,099

 
1,099

Securitization notes payable
 
 
 
 
 
 
 
 
 
Securitization notes payable
1
 
6,820

 
6,884

 
6,938

 
6,946

Private securitization 2012-PP1
3
 
739

 
744

 


 


Total securitization notes payable
 
 
7,559

 
7,628

 
6,938

 
6,946

Senior notes and convertible senior notes(a)
2
 
501

 
531

 
501

 
511

Total GM Financial debt
 
 
$
8,839

 
$
8,938

 
$
8,538

 
$
8,556

__________
(a)
Senior notes and convertible senior notes are included in GM Financial Long-term debt.

The carrying value of the syndicated warehouse facility and lease funding facilities is considered to be a reasonable estimate of fair value because these facilities have variable rates of interest and maturities of approximately one year. The fair value of bank funding facility and senior notes and convertible senior notes are based on quoted market prices, when available. If quoted prices are not available, the market value is estimated by discounting future net cash flows expected to be settled using a current risk-adjusted rate.

GM Financial uses observable and unobservable inputs to estimate fair value of the medium-term note facility. Observable inputs are used regarding an advance rate on the receivables to generate an estimated debt amount as well as the interest rate used to calculate the series of estimated principal payments. Those series of interest payments are discounted using an unobservable interest rate based on the most recent securitization in order to estimate fair value which would approximate the replacement value.

Securitization notes payable includes the 2012-PP1 Trust, for which GM Financial uses observable and unobservable inputs to

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

estimate fair value. Unobservable inputs are related to the structuring of the debt into various classes, which is based on public securitizations issued during the same time frame. Observable inputs are used by obtaining active prices based on the securitization debt issued during the same time frame. These observable inputs are then used to create expected market prices (unobservable input), which are then applied to the debt classes in order to estimate fair value which would approximate market value.

Credit Facilities

The following table summarizes further details regarding terms and availability of GM Financial's credit facilities at March 31, 2012 (dollars in millions):


Facility
Amount
 
Advances
Outstanding
 
Assets
Pledged
 
Restricted
Cash
Pledged(a)
Syndicated warehouse facility
$
2,000

 
$
277

 
$
367

 
$
7

U.S. lease warehouse facility(b)
$
600

 

 

 

Canada lease warehouse facility(c)
$
600

 
248

 
373

 
2

Medium-term note facility(d)
 
 
254

 
276

 
84

 
 
 
$
779

 
$
1,016

 
$
93

__________
(a)
These amounts do not include cash collected on finance receivables pledged of $29 million which is included in Restricted cash and marketable securities.
(b)
In January 2012 GM Financial extended the maturity date of the lease warehouse facility for lease originations in the U.S. to January 2013 . Borrowings on the facility are collateralized by leased assets.
(c)
Borrowings on the facility are collateralized by leased assets. The facility amount represents CAD $600 million at March 31, 2012, and the advances outstanding amount represents CAD $248 million at March 31, 2012.
(d)
The revolving period under this facility has ended and the outstanding debt balance will be repaid over time based on the amortization of the receivables pledged until October 2016 when any remaining amount outstanding will be due and payable.

Securitization Notes Payable

Securitization notes payable represents debt issued by GM Financial in securitization transactions. The following table summarizes securitization notes payable (dollars in millions):
 
 
March 31, 2012
 
December 31, 2011
Year of Transactions
 
Maturity Dates(a)
 
 
Original
Note
Amounts
 
Original
Weighted-
Average
Interest
Rates
 
Total
Receivables
Pledged
 

Note
Balance
 

Note
Balance
2006
 
January 2014
 
$
1,200

 
5.4%
 
$

 
$

 
$
63

2007
 
April 2014 - March 2016
 
$
1,000 - 1,500

 
5.3% - 5.5%
 
402

 
379

 
794

2008
 
October 2014 - April 2015
 
$
500 - 750

 
 6.0% - 10.5%
 
416

 
146

 
171

2009
 
January 2016 - July 2017
 
$
227 - 725

 
2.7% - 7.5%
 
354

 
258

 
298

2010
 
June 2016 - April 2018
 
$
200 - 850

 
2.2% - 3.8%
 
1,790

 
1,575

 
1,756

2011
 
February 2017 - March 2019
 
$
800 - 1,000

 
2.4% - 2.9%
 
3,723

 
3,458

 
3,813

2012
 
June 2019 - July 2019
 
$
800 - 1,000

 
2.5% - 2.9%
 
1,771

 
1,711

 


 
 
 
 
 
 
 
 
 
$
8,456

 
7,527

 
6,895

Purchase accounting premium
 
32

 
43

Total securitization notes payable
 
$
7,559

 
$
6,938

__________
(a)
Maturity dates represent final legal maturity of securitization notes payable. Securitization notes payable are expected to be paid based on amortization of the finance receivables pledged to the trusts.

Note 14. Product Warranty Liability

The following table summarizes activity for policy, product warranty, recall campaigns and certified used vehicle warranty

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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

liabilities (dollars in millions):
 
Three Months Ended March 31,
 
2012
 
2011
Balance at beginning of period
$
6,600

 
$
6,789

Warranties issued and assumed in period
864

 
725

Payments
(916
)
 
(941
)
Adjustments to pre-existing warranties
233

 
117

Effect of foreign currency translation
60

 
78

Balance at end of period
$
6,841

 
$
6,768


Note 15. Pensions and Other Postretirement Benefits

Contributions

We made a contribution in January 2011 to our U.S. hourly and salaried defined benefit pension plans of 61 million shares of our common stock valued at $2.2 billion for funding purposes at the time of contribution. The contributed shares qualified as a plan asset for funding purposes at the time of contribution and as a plan asset valued at $1.9 billion for accounting purposes in July 2011. This was a voluntary contribution above our funding requirements for the pension plans.

We continue to pursue various options to fund and derisk our pension plans, including continued changes to the pension asset portfolio mix to reduce funded status volatility and ceasing accrual of additional benefits in the U. S. salaried pension plan effective September 30, 2012. We are currently exploring other options that could result in a settlement of some of our pension liabilities.

Net Periodic Pension and OPEB Expense

The following tables summarize the components of net periodic pension and other postretirement benefits (OPEB) (income) expense (dollars in millions):
 
Three Months Ended March 31, 2012
 
U.S. Plans
Pension Benefits
 
Non-U.S. Plans
Pension Benefits
 
U.S. Plans
Other Benefits
 
Non-U.S. Plans
Other Benefits
Service cost
$
160

 
$
92

 
$
5

 
$
5

Interest cost
1,080

 
277

 
59

 
16

Expected return on plan assets
(1,332
)
 
(217
)
 

 

Amortization of prior service credit

 

 
(29
)
 
(2
)
Recognized net actuarial loss

 
8

 
13

 
1

Curtailments, settlements, and other (gains) losses
(21
)
 
28

 

 

Net periodic pension and OPEB (income) expense
$
(113
)
 
$
188

 
$
48

 
$
20



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GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —— (Continued)

 
Three Months Ended March 31, 2011
 
U.S. Plans
Pension Benefits
 
Non-U.S. Plans
Pension Benefits
 
U.S. Plans
Other Benefits
 
Non-U.S. Plans
Other Benefits
Service cost
$
158

 
$
96

 
$
6

 
$
9

Interest cost
1,229

 
301

 
67

 
52

Expected return on plan assets
(1,674
)
 
(230
)