GM Objectives 2003

GM Outlines Objectives for 2003 
 
    - $5.00 earnings per share, excluding Hughes and special items 
 
    - $10 billion cash generation 
 
    - Improved market share in all regions 
 
    DETROIT, Jan. 9 /PRNewswire/ -- General Motors Corp. (NYSE: GM, GMH) today 
said it is pursuing a strategy to generate long-term profitable growth through 
its continued worldwide product offensive, and by further leveraging the 
strength of its product development, manufacturing, purchasing, quality and 
distribution capabilities. 
    'GM's long term strategy for creating stockholder value is clear.  We're 
focused on executing a global plan to win more market share, improve our 
profitability, and capitalize on new opportunities to grow our automotive 
business in both developed and emerging markets,' said GM President and Chief 
Executive Officer Rick Wagoner, at a meeting of securities analysts and 
institutional investors during the North American International Auto Show 
here. 
    'We're achieving solid operational improvements by leveraging our 
strengths in product development, manufacturing, purchasing, quality and our 
global sales footprint.  Over the last several years, GM has demonstrated 
steady and significant improvement in our core operations.  We have developed 
an extremely strong position in trucks and sport utility vehicles, and 
embarked on a remarkable resurgence at Cadillac,' Wagoner said.  
'Additionally, we've established important and solid footprints in key growth 
markets such as China and Korea.  In 2003, we're going to pick up the pace and 
build on our excellent operating base to capitalize on market opportunities 
around the globe,' Wagoner said.  'We know what to do and we're planning to 
'go fast' in accomplishing our objectives.' 
    GM Vice Chairman and Chief Financial Officer John Devine outlined the 
company's 2003 financial goals.  This year, GM expects to earn $5.00 per share 
of GM $1-2/3 par value common stock, excluding Hughes and special items, 
generate $10 billion in cash and improve market share in all four automotive 
regions. 
    'The key to achieving these goals is great products,' said Devine.  'Our 
increasingly competitive products and cost structure will position us for 
long-term improvement in our financial performance.' 
    GM North America is expected to earn approximately $1.7 billion to $1.9 
billion in 2003, and GM Europe is expected to report improved financial 
results, in a range of break-even results to a loss of about $200 million. 
    GM expects 2003 industry sales to be down modestly in the North American 
and European markets, at 19.4 million and 19.0 million respectively; up again 
in the Asia Pacific region at about 15.0 million units; and unchanged in the 
Latin America Africa Mideast region at 3.7 million units. 
    'Pricing pressures are expected to continue in the North American and 
European markets in 2003,' Devine added. 
    GM will continue to support its product offensive with total capital 
spending of about $7 billion in 2003.  Net material cost reduction for GM 
North America is targeted at 3.0 percent, and for GM Europe at 3.5 percent.  
For North America and Europe, GM is also targeting carryover structural cost, 
excluding pension expense, reflecting strong cost performance that will 
effectively offset increases in health care expense and economics.  The strong 
material and structural cost performance expected in 2003 is on the heels of 
strong performance in 2002. 
    GMAC expects another record profit in 2002, marking the eighth consecutive 
year of earnings growth at the wholly owned finance subsidiary.  For 2003, 
GMAC expects another year of strong results, with net income targeted at $1.7 
billion to $1.9 billion.  In addition, GMAC's goal for 2003 is to again remit 
a dividend to GM while maintaining its funding-to-equity leverage ratio 
roughly in line with current levels.  GMAC paid a $400 million dividend to GM 
during the fourth quarter of 2002. 
    Strengthening GM's balance sheet continues as a priority in 2003.  A 
significant factor affecting GM's 2003 financial performance will be increased 
pension expense, which is expected to rise to about $3 billion in 2003, before 
tax, from about $1 billion before tax in 2002.  Strong cash generation in 2002 
allowed GM to contribute a total of $4.8 billion to its U.S. pension plans 
during the year, including a $2.6 billion cash contribution in the fourth 
quarter.   
    A preliminary analysis of GM's U.S. pension plans showed that the plans' 
underfunded status was approximately $19.3 billion at the end of 2002, based 
on a 2002 asset return of approximately negative 7 percent, and a discount 
rate of 6.75 percent.  The discount rate, which is used to calculate the 
present value of future pension liabilities, was reduced from 7.25 percent in 
2002.  GM's U.S. pension plans were underfunded by $9.1 billion at the end of 
2001.  Based on a comprehensive study by GM's asset managers and actuaries, GM 
has decided to reduce its asset earnings rate assumption to 9 percent in 2003 
from 10 percent in 2002. 
    In this press release and related comments by General Motors management, 
our use of the words 'expect,' 'anticipate,' 'estimate,' 'forecast,' 
'objective,' 'plan,' 'goal' and similar expressions is intended to identify 
forward looking statements.  While these statements represent our current 
judgment on what the future may hold, and we believe these judgments are 
reasonable, actual results may differ materially due to numerous important 
factors that are described in GM's most recent report on SEC Form 10-K (at 
page 11-15, 16) which may be revised or supplemented in subsequent reports on 
SEC Forms 10-Q and 8-K.  Such factors include, among others, the following: 
changes in economic conditions, currency exchange rates or political 
stability; shortages of fuel, labor strikes or work stoppages; market 
acceptance of the corporation's new products; significant changes in the 
competitive environment; changes in laws, regulations and tax rates; and, the 
ability of the corporation to achieve reductions in cost and employment levels 
to realize production efficiencies and implement capital expenditures at 
levels and times planned by management. 
    Note to editors:  General Motors will webcast its meeting with automotive 
securities analysts on Thursday, Jan. 9, 2003, from approximately 8:30 a.m. 
EST to 11:30 am EST.  The presentation will be available live through GM Media 
Online ( http://media.gm.com ), or directly at http://investor.gm.com under 
the Events and Presentations section.  A replay of the webcast will also be 
made available.  
    Presentation materials will be available under Recent Presentations in the 
Event and Presentations section. 
    Additionally, media may access the presentations via a live conference 
call (Listen Only).  Dial-in access will begin at 8:00 a.m. EST.  To access 
the conference call, please dial 1-888-428-4471 (612-332-1025 for 
international access) with confirmation #667309 and ask to be connected to the 
General Motors conference call.  
    A taped replay of the call will be made available from 8:00 p.m. EST, 
January 10 until 11:59 p.m. EST, January 12, 2003.  Please dial 1-800-475-6701 
(320-365-3844 for international access) and enter reservation number 667309 to 
access the taped replay. 
 
SOURCE  General Motors Corporation 
    -0-                             01/09/2003 P 
    /CONTACT:  Toni Simonetti, [phone] (Office), [phone] 
(Mobile), [e-mail] , or Jerry Dubrowski, [phone] 
(Office), [phone] (Mobile), [e-mail] , both of General 
Motors Corporation/ 
    /Web site:  http://media.gm.com / 
    /Web site:  http://www.gm.com / 
    (GM GMH) 
 
CO:  General Motors Corporation 
ST:  Michigan 
IN:  AUT 
SU:  ERP TDS