1467858--4/7/2010--General_Motors

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Our business is highly dependent on sales volume. Global vehicle sales have declined significantly from their peak levels and there is no assurance that the global automobile market will recover in the near future or that it will not suffer a significant further downturn. Our ability to attract a sufficient number of consumers to consider our vehicles particularly our new products, including cars and crossover vehicles, is essential. GENERAL MOTORS COMPANY AND SUBSIDIARIES Our continued ability to achieve cost reductions and to realize production efficiencies for our automotive operations is critical to our ability to return to profitability. The ability of our new executive management team to quickly learn the automotive industry and lead our company will be critical to our ability to succeed. Failure of our suppliers, due to difficult economic conditions affecting our industry, to provide us with the systems, components and parts that we need to manufacture our automotive products and operate our business could result in a disruption in our operations and have a material adverse effect on our business. GENERAL MOTORS COMPANY AND SUBSIDIARIES Increase in cost, disruption of supply or shortage of raw materials could materially harm our business. The pace of introduction and market acceptance of new vehicles is important to our success and the frequency of new vehicle introductions may be materially adversely affected by reductions in capital expenditures. Inadequate cash flow could materially adversely affect our business operations in the future. As part of our business plan, we have reduced compensation for our most highly paid executives and have reduced the number of our management and non-management salaried employees, and these actions may materially adversely affect our ability to hire and retain salaried employees. GENERAL MOTORS COMPANY AND SUBSIDIARIES Our plan to reduce the number of our retail channels and core brands and to consolidate our dealer network is likely to reduce our total sales volume, may not create the cost savings we anticipate and is likely to result in restructuring costs that may materially adversely affect our results of operations. Our business plan contemplates that we restructure our operations in various European countries, but we may not succeed in doing so, and that could have a material adverse effect on our business. Continued limited availability of adequate financing on acceptable terms through GMAC or other sources to our customers and dealers, distributors and suppliers to enable them to continue their business relationships with us could materially adversely affect our business. GENERAL MOTORS COMPANY AND SUBSIDIARIES The UST (or its designee) owns a controlling interest in us and its interests may differ from those of our other stockholders. The UST Credit Agreement and VEBA Note Agreement contain significant representations and affirmative and negative covenants that may restrict our ability and the ability of our subsidiaries to take actions management believes are important to our long-term strategy. GENERAL MOTORS COMPANY AND SUBSIDIARIES Even though we have made significant modifications to our obligations to the New VEBA, we are still obligated to contribute a significant amount of cash to fund the New VEBA in the future and cumulative dividends on the Series A Preferred Stock must be paid prior to any dividends or distributions to common stockholders. Our pension funding obligations may increase significantly due to weak performance of financial markets and its effect on plan assets. Despite the formation of our new Company, we continue to have indebtedness and other obligations. Our debt obligations together with our cash needs may require us to seek additional financing, minimize capital expenditures or seek to refinance some or all of our debt. GENERAL MOTORS COMPANY AND SUBSIDIARIES Our planned investment in new technology in the future is significant and may not be funded at anticipated levels, and, even if funded at anticipated levels, may not result in successful vehicle applications. New laws, regulations or policies of governmental organizations regarding increased fuel economy requirements and reduced greenhouse gas emissions, or changes in existing ones, may have a significant effect on how we do business. GENERAL MOTORS COMPANY AND SUBSIDIARIES We may be unable to qualify for federal funding for our advanced technology vehicle programs under Section 136 of the EISA or may not be selected to participate in the program. GENERAL MOTORS COMPANY AND SUBSIDIARIES A significant amount of our operations are conducted by joint ventures that we cannot operate solely for our benefit. Shortages of and volatility in the price of oil have caused and may continue to cause diminished profitability due to shifts in consumer vehicle demand. We could be materially adversely affected by changes or imbalances in foreign currency exchange and other rates. Our businesses outside the U.S. expose us to additional risks that may materially adversely affect our business. GENERAL MOTORS COMPANY AND SUBSIDIARIES New laws, regulations or policies of governmental organizations regarding safety standards, or changes in existing ones, may have a significant negative effect on how we do business. The costs and effect on our reputation of product recalls could materially adversely affect our business. We have determined that our disclosure controls and procedures and our internal control over financial reporting are currently not effective. The lack of effective internal controls could materially adversely affect our financial condition and ability to carry out our business plan.

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1467858--4/7/2010--General_Motors_Co