Result of Meeting

GM Expects Improved Financial Performance in 2006 
 
                  North American Turnaround Is Top Priority 
 
                 Further Structural Cost Targets Established 
 
    DETROIT, Jan. 13 -- General Motors Corp. (NYSE: GM) Chairman and Chief 
Executive Officer Rick Wagoner today said the company is moving rapidly to 
implement its North American turnaround plan in order to improve GM's financial 
performance in 2006 and transform the company for long-term success. 
    In a meeting with securities analysts here today, Wagoner said the top 
priority for the company is to return GM's North American operations to 
profitability and positive cash flow as quickly as possible. 
    'We continue to explore ways to strengthen our liquidity, and we know the 
most obvious way is to get our North American automotive operations back to 
generating positive cash flow,' Wagoner said.  'And we will continue to pursue 
other opportunities as well. 
    'Our primary focus in North America this year is to fully and rapidly 
implement our turnaround plan, which focuses on the areas that can quickly 
improve our results and, just as important, fundamentally enhance our long-
term competitiveness,' Wagoner said.  'We expect to see improved results in 
2006 and further progress in 2007.' 
    A key element of GM's turnaround strategy is delivering great cars and 
trucks.  Over the next two years, GM will rapidly revitalize its product 
portfolio with new full-sized sport utility vehicles and pick-up trucks, 
additional crossover vehicles, and a significantly expanded line-up for 
Saturn.    
 
                        Revitalized Product Portfolio 
 
    In 2006, approximately 29 percent of GM's North American sales volume is 
expected to come from recently launched cars and trucks, as well as upcoming 
new entries such as the Chevrolet Tahoe, Saturn Sky, GMC Yukon, Cadillac 
Escalade, and Saturn Aura.  By 2007, GM expects more than 30 percent of GM's 
sales volume to come from these new vehicles.  
    'As we demonstrated at the Detroit auto show this week, GM is committed to 
bringing out great cars and trucks,' Wagoner said.  'The Chevy Camaro concept 
car, which was picked as best concept car for the auto show, and the new 
Saturn Vue hybrid vehicle are but two examples of the strength and mission of 
our design and engineering team.' 
    In addition to launching many exciting cars and trucks, GM also is 
refining its sales and marketing strategy by moving to simple, more compelling 
pricing.   
    'Earlier this week we announced the next big step in our 'Total Value 
Promise' marketing strategy by reducing the sticker prices on all Chevrolet 
models as well as many other GM vehicles,' Wagoner said.  'This move is 
designed to highlight the fact that we're offering customers an extremely 
compelling model line up at great everyday prices.  This will enhance the 
image of our brands, drive traffic into dealer showrooms and raise awareness 
of the inherent quality and value of our vehicles.' 
    GM also is moving aggressively to implement the company's previously 
announced plan to reduce ongoing structural costs by $6 billion a year by the 
end of 2006 and further reduce material costs by $1 billion.  The key elements 
of the structural cost reduction include the historic health-care agreement 
with the United Auto Workers union, the capacity utilization initiatives that 
GM announced late last year, and additional cost efficiencies in most other 
areas of the business including engineering, advertising, salaried employment 
levels and benefits and indirect material costs.  Of the $6 billion already 
identified, GM expects to realize approximately $4 billion in savings in 2006 
as the initiatives are implemented throughout this year.   
    'Everyone at GM is focused on executing our plan to realize the structural 
and material cost reductions this year, and achieve additional cost reductions 
in 2007,' Wagoner said.   
 
                Aggressive Cost Reduction Targets Established 
 
    Beyond the $6 billion in cost reductions planned for 2006, GM announced 
today the next phase in its strategy aimed at driving down global automotive 
structural costs.  GM is now targeting to reduce structural costs as a percent 
of revenue to 25 percent in 2010 from the current level of about 34 percent on 
a global basis.   
    'This would significantly enhance GM's earnings power and financial 
flexibility, and reduce our business risk,' Wagoner said.  'We're expecting a 
big improvement in this metric in 2006, and we are finalizing plans to achieve 
this 25 percent target by the end of the decade.  Key initiatives to achieving 
this objective include the further globalization of product development and 
other key functions, achieving full capacity utilization, leveraging global 
vehicle architectures and powertrains, and achieving further progress in our 
legacy cost disadvantage.' 
 
                           Other Automotive Regions 
 
    GM expects another record year for global auto industry sales in 2006, 
driven by growth in the Asia-Pacific region.  In 2006, GM plans to take full 
advantage of its strong position in China, continue to leverage its 
capabilities at GM Daewoo, and execute the turnaround at GM's Holden unit in 
Australia.  In Europe, GM expects continued progress this year, reflecting a 
stronger product portfolio and the full-year impact of restructuring efforts.  
And in the Latin America/Africa/Mid-East region, GM plans to further leverage 
its position in South Africa and accelerate the turnaround program at GM 
Brazil.  
    General Motors Acceptance Corp. (GMAC) also is expected to post solid 
results in both 2005 and 2006 despite a challenging credit rating environment.  
GMAC continues to have a strong liquidity position with approximately $20 
billion in cash at the end of 2005 and continued access to alternative funding 
sources such as automotive whole loan sales. 
    GM continues to explore the possible sale of a controlling interest in 
GMAC to a strategic partner with the goal of restoring GMAC's investment-grade 
credit rating while retaining GMAC's strategic financial services support to 
GM's global vehicle sales operations. 
    GM also announced that its U.S. hourly and salaried pension plans were 
approximately $6 billion overfunded at the end of 2005 on a FAS-87 accounting 
basis largely as a result of preliminary asset returns of 13 percent in 2005. 
For 2006, GM's assumed rate of return on assets in its U.S. hourly and 
salaried pension plans remains unchanged at 9 percent from the previous year.  
The discount rate used at the end of 2005 to measure GM's U.S. pension plan 
obligations is currently estimated at 5.55 percent, down from 5.75 percent at 
the end of 2004, and the discount rate for Other Post Employment Benefit 
(OPEB) obligations is currently estimated at 5.30 percent, down from 5.75 
percent at the end of 2004.   
    Given several key uncertainties that GM is currently addressing, including 
Delphi matters, the potential sale of an equity stake in GMAC, and the timing 
of implementing the landmark health-care agreement with the UAW, GM is not 
providing 2006 financial guidance at this time.  
    A taped replay of GM's call with securities analysts will be made 
available from 11:30 a.m. EST on January 13 until 11:30 a.m. EST on  
January 17.  To access the taped replay, dial 800-633-8284 (402-977-9140 for 
international access) and enter reservation number 21275621 to access the 
taped replay.  The charts used by GM and GMAC management in their 
presentations will be available live via a hot link in GM Media Online at 
http://media.gm.com , or directly at http://investor.gm.com under the 
'Calendar/Events' section.  Presentation materials will also be retained for a 
limited time under 'Recent Events' in the 'Calendar/Events' section at these 
online sites. 
 
    Forward-looking Statements 
    In this press release and in related comments by General Motors' and 
General Motors Acceptance Corporation's management, the use of the words 
'expect,' 'anticipate,' 'estimate,' 'forecast,' 'initiative,' 'objective,' 
'plan,' 'goal,' 'project,' 'outlook,' 'priorities,' 'target,' 'intend,' 
'evaluate,' 'pursue,' 'seek,' 'may,' 'would,' 'could,' 'should,' 'believe,' 
'potential,' 'continue,' 'designed,' 'impact,' or the negative of any of those 
words or similar expressions is intended to identify forward-looking 
statements.  All statements in this press release and in related comments, 
other than statements of historical fact, including without limitation, 
statements about future events and financial performance, are forward-looking 
statements that involve certain risks and uncertainties. 
    While these statements represent our current judgment on what the future 
may hold, and we believe these judgments are reasonable, these statements are 
not guarantees of any events or financial results, and GM's actual results may 
differ materially due to numerous important factors that are described in GM's 
most recent report on SEC Form 10-K, which may be revised or supplemented in 
subsequent reports on SEC Forms 10-Q and 8-K.  Such factors include, among 
others, the following: the ability of GM to realize production efficiencies, 
to achieve reductions in costs as a result of the turnaround restructuring and 
health care cost reductions and to implement capital expenditures at levels 
and times planned by management; the pace of product introductions; market 
acceptance of the corporation's new products; significant changes in the 
competitive environment and the effect of competition in the corporation's 
markets, including on the corporation's pricing policies; our ability to 
maintain adequate financing sources and an appropriate level of debt; 
restrictions on GMAC's and Residential Capital Corporation (ResCap)'s ability 
to pay dividends and prepay subordinated debt obligations to us; changes in 
the existing, or the adoption of new, laws, regulations, policies or other 
activities of governments, agencies and similar organizations where such 
actions may affect the production, licensing, distribution or sale of our 
products, the cost thereof or applicable tax rates; costs and risks associated 
with litigation; the final results of investigations by the SEC; changes in 
our accounting assumptions that may require or that result from changes in the 
accounting rules or their application, which could result in an impact on 
earnings; changes in relations with unions and employees/retirees and the 
legal interpretations of the agreements with those unions with regard to 
employees/retirees; labor strikes or work stoppages at GM or at key suppliers 
such as Delphi Corp.; additional credit rating downgrades; the impact of a 
potential sale or other extraordinary transaction involving GMAC on the 
results of GM's and GMAC's operations and liquidity; other factors impacting 
financing and insurance operating segments' results of operations and 
financial condition such as credit ratings, adequate access to the market, 
changes in the residual value of off-lease vehicles, changes in U.S. 
government-sponsored mortgage programs or disruptions in the markets in which 
our mortgage subsidiaries operate, and changes in our contractual servicing 
rights; shortages of and price increases for fuel; and changes in economic 
conditions, commodity prices, currency exchange rates or political stability 
in the markets in which we operate. 
    In addition, GMAC's actual results may differ materially due to numerous 
important factors that are described in GMAC's most recent report on SEC Form 
10-K, which may be revised or supplemented in subsequent reports on SEC Forms 
10-Q and 8-K.  Such factors include, among others, the following:  the ability 
of GM, to complete a transaction with a strategic investor regarding a 
controlling interest in GMAC while maintaining a significant stake in GMAC, 
securing separate credit ratings and low cost funding to sustain growth for 
GMAC and ResCap and maintaining the mutually beneficial relationship between 
GMAC and GM; significant changes in the competitive environment and the effect 
of competition in the corporation's markets, including on the corporation's 
pricing policies; our ability to maintain adequate financing sources; our 
ability to maintain an appropriate level of debt; the profitability and 
financial condition of GM, including changes in production or sales of GM 
vehicles, risks based on GM's contingent benefit guarantees and the 
possibility of labor strikes or work stoppages at GM or at key suppliers such 
as Delphi Corp.; funding obligations under GM and its subsidiaries' qualified 
U.S. defined benefits pension plans; restrictions on ResCap's ability to pay 
dividends and prepay subordinated debt obligations to us; changes in the 
residual value of off-lease vehicles; changes in U.S. government-sponsored 
mortgage programs or disruptions in the markets in which our mortgage 
subsidiaries operate; changes in our contractual servicing rights; costs and 
risks associated with litigation; changes in our accounting assumptions that 
may require or that result from changes in the accounting rules or their 
application, which could result in an impact on earnings; changes in the 
credit ratings of GMAC or GM; the threat of natural calamities; changes in 
economic conditions, currency exchange rates or political stability in the 
markets in which we operate; and changes in the existing, or the  adoption of 
new, laws, regulations, policies or other activities of governments, agencies 
and similar organizations. 
    Investors are cautioned not to place undue reliance on forward-looking 
statements. GM undertakes no obligation to update publicly or otherwise revise 
any forward-looking statements, whether as a result of new information, future 
events or other such factors that affect the subject of these statements, 
except where expressly required by law. 
    Use of the term 'loans' describes products associated with direct and 
indirect lending activities of GMAC's global operations.  The specific 
products include retail installment sales contracts, loans, lines of credit, 
leases or other financing products.  The term 'originate' refers to GMAC's 
purchase, acquisition or direct origination of various 'loan' products. 
 
SOURCE  General Motors Corp. 
    -0-                             01/13/2006 P 
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