• Unprecedented economic and credit market turmoil dramatically impacts auto industry and GM results
• Market volatility results in $1.5 billion in non-cash charges for commodity and currency hedging
• Company anticipates soft U.S. market for remainder of 2008 and into 2009
• Emerging markets beginning to show impact of credit crisis

DETROIT –General Motors (NYSE: GM) today announced its financial results for the third quarter of 2008, reflecting rapidly deteriorating market conditions in the U.S., slowdowns in other mature markets around the world, and continued losses at GMAC Financial Services (GMAC).

During the third quarter the turmoil in the global credit markets resulted in the worst financial crisis in more than 70 years. The upheaval has had a dramatic impact on the auto business in particular, especially in the U.S. and Western Europe.

Tight credit, rising unemployment, declining income, falling stock markets, and continuing deterioration in the housing market in the U.S., resulted in an abrupt halt in consumer spending, with most consumers exiting the vehicle market. Many of those still intending to purchase vehicles were denied financing, or found the cost of financing prohibitive.

“The third quarter was especially challenging for the auto industry. Consumer spending, which represents close to 70 percent of the U.S. economy, fell dramatically, and the abrupt closure of credit markets created a downward spiral in vehicle sales,” said Rick Wagoner, Chairman and Chief Executive Officer. “The U.S. government’s actions to help stabilize the credit markets and eventually ease the credit crunch are an essential first step to the economy’s and the auto industry’s recovery, but further strong action is required.”

GM reported a net loss of $2.5 billion or $4.45 per share for the third quarter, including special items. That compares with a net loss from continuing operations of $42.5 billion or $75.12 per share in the third quarter of 2007, which included a non-cash charge of $38.3 billion to establish a valuation allowance against some of the company’s net deferred tax assets.

On an adjusted basis, GM posted a net loss of $4.2 billion or $7.35 per share, compared with a net loss from continuing operations of $1.6 billion or $2.86 per share in the same period last year.

Revenue for the third quarter was $37.9 billion, down from $43.7 billion in the year-ago quarter, reflecting dramatic sales declines across the industry driven by unstable market conditions, instability in the credit markets and dramatic retraction in consumer demand, especially in North America and Europe.

GM recorded net favorable charges of $1.7 billion for special items in the third quarter. Included in the charges was a curtailment gain of $4.9 billion resulting from the UAW Settlement Agreement becoming effective. The curtailment represents the accelerated recognition of net prior service credits, largely relating to the 2005 GM UAW healthcare agreement, scheduled for amortization after January 1, 2010.

The curtailment was recorded because GM’s UAW retiree health plan will not exist after January 1, 2010, and therefore no further basis for deferring unamortized prior service credits exists beyond that date. The $4.9 billion curtailment gain was partially offset by a non-cash $1.7 billion settlement charge related to the elimination of post-65 salaried retiree healthcare coverage, including the cost of increased pension benefits that were announced in July as part of GM’s operating actions to improve liquidity as well as the recognition of accumulated deferred losses related to the healthcare plan.

In addition, GM reported charges of $652 million relating to its commitments as part of Delphi’s bankruptcy proceedings, $251 million for impairment of investments in GMAC, and $641 million in restructuring-related and other charges. Details on these and all other special items are in the financial highlights section of this release.

GM Automotive Operations

GM reports its automotive operations and regional results on an earnings-before-tax basis, with taxes reported on a total corporate basis.

GM recorded an adjusted automotive loss of $2.8 billion ($947 million reported loss) in the third quarter 2008. The loss compares with adjusted automotive earnings from continuing operations of $98 million in the third quarter of 2007 (reported net loss of $1.6 billion).

The results reflect losses in GM North America (GMNA) driven largely by the U.S. industry volume decline of nearly 20 percent, and shifts in product mix. In addition, Europe saw rapid auto market contraction, leading to sharply lower GM Europe (GME) sales volume in the third quarter. GM Asia Pacific (GMAP) results were down due to commodity hedging charges and moderating demand in key markets including China, Australia and India. These losses were partially offset by very strong results in the GM Latin America, Africa and Middle East (GMLAAM) region.

GM’s automotive results in the third quarter include $1.5 billion of expenses related to mark-to-market changes in the value of GM’s commodity and foreign exchange hedging contracts, due almost entirely to falling commodity prices.

GM sold 2.1 million vehicles worldwide in the third quarter, down 11 percent year over year. Sales in GMNA were down 19 percent compared to third quarter 2007. GM global market share was 13 percent, down 0.7 percentage points compared with the third quarter of 2007, due largely to weakness in North America and Western Europe.

GMNA

GMNA revenue and earnings in the third quarter reflect dramatic industry deterioration and a sharp fall in consumer spending driven by the weak U.S. economy and a very harsh credit environment. Earnings were impacted by lower volumes, rapid shifts among U.S. consumers away from trucks and SUVs toward smaller cars, and unfavorable mark-to-market adjustments on commodity hedging.

GME

GME revenue was down 15 percent in the third quarter amid industry-wide volume declines ranging from 10 to 35 percent in certain major markets including the U.K., Spain and Italy. Overall GME sales volume was down 12.3 percent year over year, while up 10 percent in Eastern Europe. Earnings were largely impacted by the lower volumes, and unfavorable mix and negative pricing. In addition, unfavorable foreign exchange relating to the weakening of the British pound and the mark-to-market of commodity hedges negatively impacted earnings. Results were partially offset by favorable structural cost performance.

GMAP

Results in GMAP were impacted primarily by unfavorable mix and negative pricing. In addition, GMAP results were impacted by unfavorable hedging, which was largely offset by the favorable foreign exchange impact of exports.

Industry sales for the region were down by 134,000 units or 2.7 percent in the third quarter. Despite the slowdown, GM reported a 2.6 percent increase in sales volume, and modest gain in market share. Markets in the GMAP region are expected to remain soft through the fourth quarter, with further slow downs anticipated in Australia, China, South Korea and India as the contagion of the faltering U.S. economy and tightening credit conditions expand to other regions around the world.

GMLAAM

GMLAAM saw double-digit revenue growth, up 15 percent, and earnings, up 37 percent, in the third quarter, fueled by strong demand for Chevrolet and Cadillac products. GMLAAM sales volume was up more than 3 percent compared to the same period last year. Sales were especially strong in key South America markets, including Brazil, Chile, Ecuador and Peru, each setting all-time GM quarterly sales records. The region is on track for another year of record sales, although the effects of the global economic slowdown on credit availability and consumer behavior are likely to result in some moderation of demand in the fourth quarter.

GMAC

On a standalone basis, GMAC reported a net loss of $2.5 billion for the third quarter 2008, down $900 million from the year-ago quarter. GM reported an adjusted loss of $1.2 billion for the quarter attributable to GMAC, as a result of its 49 percent equity interest.

GMAC’s automotive finance operation experienced pressure from lower used vehicle prices and weaker consumer and dealer credit performance. GMAC’s ResCap operations reported further losses as a result of adverse market conditions, which drove high credit-related provisions and weak revenue. GMAC’s Insurance business remained profitable.

Cash and Liquidity

Cash, marketable securities, and readily-available assets of the Voluntary Employees’ Beneficiary Association (VEBA) trust totaled $16.2 billion on September 30, 2008, down from $21.0 billion on June 30, 2008.

The change in liquidity reflects negative adjusted operating cash flow of $6.9 billion in the third quarter 2008, driven by the industry-wide slowdown in vehicle demand and compounding credit crisis, especially in North America and Europe. During the quarter, GM drew the remaining $3.5 billion of its secured revolving credit facility and made $1.2 billion in payments to Delphi as required by agreements between the companies as part of Delphi’s bankruptcy proceedings.

GM expects adjusted operating cash flow in the fourth quarter to be much improved versus the third quarter, and more consistent with the first half of the year. Improvements in fourth quarter cash flow are largely driven by anticipated improvements in working capital in North America relating to sales allowances, and lower fourth quarter finished vehicle inventory in Europe.

Improving its liquidity position remains a top priority for the company. In response to deteriorating market conditions, GM announced today that in addition to the $15 billion in liquidity initiatives it outlined in July 2008, it has identified $5 billion of incremental liquidity actions. Cumulatively, GM has announced actions aimed at improving liquidity by $20 billion through 2009. To date, $10 billion in internal operating actions have either already been completed or are on track for full execution by the end of 2009.

Even if GM implements the planned operating actions that are substantially within its control, GM’s estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business.  Looking into the first two quarters of 2009, even with its planned actions, the company’s estimated liquidity will fall significantly short of that amount unless economic and automotive industry conditions significantly improve, it receives substantial proceeds from asset sales, takes more aggressive working capital initiatives, gains access to capital markets and other private sources of funding, receives government funding under one or more current or future programs, or some combination of the foregoing.  The success of GM’s plans necessarily depends on other factors, including global economic conditions and the level of automotive sales, particularly in the United States and Western Europe.

Further detail on the additional liquidity actions and GM’s current liquidity position and outlook will be disclosed in a Form 8-K filing with the Securities and Exchange (SEC) later today.

Effort begins by educating consumers that 3,000-mile oil changes are a thing of the past

GRAND BLANC, Mich . – Goodwrench is sending a few automotive maintenance myths to the scrap heap in an effort to help consumers save money, time and wear and tear on the environment. The effort continues with the biggest myth in the business, the often-recommended 3,000-mile / three-month oil change.

GM is debunking this myth with its patented engine Oil Life System (OLS). Because GM’s OLS tells vehicle owners exactly when to change their oil based on individual driving habits, a motorist who drives an average of 15,000 miles per year, this could mean between two to three fewer oil changes annually.

“ The GM Oil Life System monitors combustion events, engine temperature and other parameters to gauge the oil’s life,” said Matthew Snider, GM’s lead engineer for the GM Oil Life System . “Over the years, millions of test miles have been accumulated to calibrate the system for a variety of vehicles. Keeping pace with technology, the system continues to be upgraded periodically to account for advances in lubrication and engine design.”

Besides saving time and money, cutting out unnecessary oil changes also helps protect the environment. According to Margo Reid Brown, director of the California Environmental Protection Agency’s California Integrated Waste Management Board (CIWMB), just one gallon of oil that makes its way into our waterways can pollute a million gallons of water.

More than 97 percent of GM vehicles sold today in the U.S. and more than 31 million GM vehicles currently on American roads are equipped with the OLS. The system is based on an algorithm that tracks engine revolutions and temperature, and predicts oil life based on these parameters and driver use. If all drivers of GM vehicles currently equipped with the system in the U.S. use the system as intended, they would save more than 100 million gallons of motor oil consumed annually, compared to the 3,000 mile interval.

The American Petroleum Institute states that more than 1 billion gallons of motor oil are sold each year in the U.S. Of this, about 185 million gallons of used motor oil are disposed of improperly each year – dumped onto the ground, tossed into the trash or poured down the drain, according to the U.S. Environmental Protection Agency.

Earlier this year, the California Environmental Protection Agency’s California Integrated Waste Management Board (CIWMB) and General Motors joined forces to encourage drivers to follow their vehicle manufacturer’s recommendations on oil changes.

“Drivers across the country can do their part by debunking this myth and not wasting oil that still has life by changing it prematurely,” said the CIWMB’s Brown.

How OLS works

GM’s Oil Life System uses a special computerized algorithm that monitors engine speed and temperature, and continuously examines engine conditions to determine when it’s time to change the motor oil. GM’s Oil Life System will automatically adjust the oil change interval based on engine characteristics, driving habits and the climate in which the vehicle is operated. Even with an advanced technology like the Oil Life System, it is still a good idea to periodically check a vehicle’s oil level before going on long road trips or after extensive driving.

GM’s service schedule is based on the Oil Life System, allowing for a more consolidated service schedule which is a departure from the typical industry approach of basing maintenance intervals on mileage.

Additional debunked auto maintenance myths

Changing a car’s oil every 3,000 miles isn’t the only auto maintenance myth Goodwrench experts are busting. Goodwrench also helps vehicle owners by dispelling additional automotive maintenance myths that encourage consumers to spend money on unnecessary vehicle repairs that don’t improve fuel efficiency, performance and aren’t environmentally friendly. Besides changing a vehicle’s oil, other vehicle services have changed over the years, particularly within the first 60,000 to 100,000 miles of ownership. Here are some of the most commonly held maintenance myths that have been busted or adjusted based on technologies available on today’s vehicles.

• Tune-ups : Today’s engines have computer-monitored and controlled systems that still need to be checked, but they don’t need a traditional tune-up every few thousand miles. A standard tune-up used to call for new ignition parts such as a distributor cap, spark plugs and points and rotors. Besides spark plugs, which usually don’t have to be changed until 100,000 miles, today’s cars aren’t built with points and rotors, and many engines don’t have distributor caps that need replacement as often.

• Lubrication : Most new cars no longer require chassis lubrication. Having a mechanic install a fitting so the vehicle’s chassis can be lubed can lead to additional problems by adding grease and components where none are necessary or originally intended.

• Annual radiator flush : Manufacturers have made significant advancements in engine cooling systems during the past few years with closed systems that recirculate coolant. These new systems don’t lose coolant as often, and coolant manufacturers have also made advancements in their products’ chemical components with synthetic materials, making the seasonal radiator flush almost extinct. It is still important to check fluid levels periodically – especially before long trips – and use the manufacturer-recommended coolant.

• Wheel alignment: Although it’s important to keep tires properly maintained and inflated, it’s not always necessary to have them aligned every time they are rotated. A majority of manufacturers recommend a wheel alignment and wheel balance only if there is a major issue with the car pulling to one side or another.

• Unnecessary services : Maintenance services such as fuel injector cleaning and transmission fluid flushes aren’t necessary as often anymore. Some routine maintenance services are still needed, but in most cases they aren’t, so compare what’s being suggested with what the owner’s manual recommends – and possibly avoid spending money on unneeded maintenance.

• When in doubt, check us out : Visit a Goodwrench service expert or check the vehicle’s owner’s manual to get accurate answers to maintenance questions. Visit Goodwrench.com’s owner’s manual section at http://www.goodwrench.com/Tips/OwnerManuals.jsp for more information.

Fall provides a great opportunity to get some of those automotive maintenance myths debunked at a local Goodwrench service lane before winter driving months blow in. Visit a participating GM dealer’s Goodwrench service lane and receive a Goodwrench & Go Maintenance Package for any GM vehicle. To find a participating dealer, go to www.goodwrench.com.

GM Reports 170,585 Deliveries in October

• U.S. auto industry at lowest monthly SAAR in more than 25 years

DETROIT – General Motors dealers in the United States delivered 170,585 vehicles in October, down 45 percent compared with a year ago. GM truck sales of 97,119 were down 51 percent and car sales of 73,466 were off 34 percent. The steep decline in vehicle sales was largely due to a significant drop in the market’s retail demand as uncertainty over the deepening credit crisis impacted consumer confidence.

“The market has been shrinking for three years, but in October we saw a dramatic decline for the industry and GM,” said Mark LaNeve, vice president, GM North America Vehicle Sales, Service and Marketing. “ We are obviously disappointed in our results which reflect a difficult comparison with a strong year-ago October performance. More importantly, it also reflects an unprecedented credit crunch that is dramatically impacting the entire U.S. economy – from the housing market to big and small companies to banks to family run businesses. The credit freeze has also had a very negative impact on consumers’ confidence and their purchase behavior across America.”

“We outpaced the competition with our sales results in August and September, and fell back with the industry in October. If you adjust for population growth, this is probably the worst industry sales month in the post-WWII era,” LaNeve added. “We believe there is considerable pent-up demand from the last three years, but until the credit markets open up and consumer confidence improves, the entire U.S. economy, and any industry like autos that relies on financing, will suffer.

“We’ll do our part to continue fighting against these significant economic headwinds by bringing consumers the highest quality, most fuel efficient and affordable cars, trucks and crossovers that we can,” he said.

To that end, LaNeve announced that GM’s no-haggle Red Tag Event starts nationwide tomorrow, Nov. 4. The Red Tag Event will provide great deals on most new vehicles in GM’s portfolio by offering a special Red Tag vehicle price and customer cash back. In addition, GM’s recently announced “Financing That Fits” program enables consumers to find financing at affordable rates from GMAC and thousands of other banks, credit unions and financing institutions.

Despite the poor results in October, there were a number of bright spots for individual GM car and truck lines, including:

• Chevrolet Malibu retail sales were up 129 percent. For the month, Malibu total sales reached nearly 11,000 vehicles. For the year, Malibu retail sales have totaled nearly 98,000 cars, up 134 percent from year-ago figures.
• The all-new Pontiac Vibe recorded a 6 percent total sales increase in October. Almost 42,000 Vibes have been sold this year, up 36 percent from the prior year.
• Saab retail sales were up 7.4 percent compared with a year ago, driven by the strong retail performance of the 9-3, which was up more than 16 percent.
• GM sold 44,500 Chevrolet Silverado, GMC Sierra and Chevrolet Avalanche full-size pickups in October, further solidifying its segment leadership.
• GM hybrids continue to build sales momentum and the company has broken through the 10-thousand vehicle sales mark. A total of 1,496 hybrid vehicles were delivered in the month. Hybrid sales included: 372 hybrid Chevrolet Tahoe, 193 GMC Yukon and 230 Cadillac Escalade 2-mode SUVs delivered. There were 325 Chevrolet Malibu, 22 Saturn Aura and 354 Vue hybrids sold in October. GM has sold 10,549 hybrids so far in 2008.

GM continues to proactively manage inventories to align supplies with market demand. In October, only about 799,000 vehicles were in stock, down about 146,000 vehicles (or about 15 percent) compared with last year. There were about 336,000 cars and 463,000 trucks (including crossovers) in inventory at the end of October.

“These are extraordinary times for the U.S. economy, for consumers and for an auto industry that is running at deep recessionary levels relative to 1999-2006,” LaNeve said. “We are offering the highest quality and best value vehicles to customers in our history – along with great incentives. But we can’t do it alone as GM or the auto industry. It will take a coordinated national effort to turn this economy around.”

Certified Used Vehicles

October 2008 sales for all certified GM brands, including GM Certified Used Vehicles, Cadillac Certified Pre-Owned Vehicles, Saturn Certified Pre-Owned Vehicles, Saab Certified Pre-Owned Vehicles, and HUMMER Certified Pre-Owned Vehicles, were 33,735 vehicles, down 15 percent from October 2007. Year-to-date sales are 408,451 vehicles, down 7 percent from the same period last year.

GM Certified Used Vehicles, the industry’s top-selling certified brand, posted October sales of 29,167 vehicles, down 16 percent from October 2007. Saturn Certified Pre-Owned Vehicles sold 783 vehicles, down 11 percent. Cadillac Certified Pre-Owned Vehicles sold 3,051 vehicles, down 6 percent. Saab Certified Pre-Owned Vehicles sold 506 vehicles, down 2 percent, and HUMMER Certified Pre-Owned Vehicles sold 228 vehicles, up 75 percent.

“October sales were disappointing for certified GM programs, as consumer uncertainty over the growing credit crisis had a negative impact on consumer confidence and retail demand for both new and used vehicles,” said LaNeve. “Going forward, we will continue offering consumers the tremendous peace of mind and value that comes with a factory-backed, fully inspected and reconditioned, late-model used vehicle from the GM brands they know and trust.”

GM North America Reports October, 2008 Production; Fourth Quarter Forecast Remains at 875,000 Vehicles

In October, GM North America produced 318,000 vehicles (151,000 cars and 167,000 trucks). This is down 105,000 vehicles or 25 percent compared with October 2007 when the region produced 423,000 vehicles (152,000 cars and 271,000 trucks). (Production totals include joint venture production of 11,000 vehicles in October 2008 and 18,000 vehicles in October 2007.)

The GM North America fourth-quarter production forecast remains at 875,000 vehicles (407,000 cars and 468,000 trucks) which is down about 16 percent compared with a year ago. GM North America built 1.042 million vehicles (358,000 cars and 684,000 trucks) in the fourth-quarter of 2007.

General Motors Corp. (NYSE: GM), the world’s largest automaker, has been the annual global industry sales leader for 77 years. Founded in 1908, GM today employs about 266,000 people around the world. With global headquarters in Detroit, GM manufactures its cars and trucks in 34 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM’s OnStar subsidiary is the industry leader in vehicle safety, security and information services. More information on GM can be found at www.gm.com.

Note: GM sales and production results are available on GM Media OnLine at http://media.gm.com by clicking on News, then Sales/Production. In this press release and related comments by General Motors management, we use words like “expect,” “anticipate,” “estimate,” “forecast,” “objective,” “plan,” “goal” and similar expressions to identify forward-looking statements, representing our current judgment about possible future events. We believe these judgments are reasonable, but actual results may differ materially due to a variety of important factors.

Among other items, such factors might include: market acceptance of our products; shortages of and price increases for fuel; significant changes in the competitive environment and the effect of competition on our markets, including on our pricing policies; our ability to maintain adequate liquidity and financing sources and an appropriate level of debt; and changes in general economic conditions. GM’s most recent annual report on Form 10-K and quarterly report on Form 10-Q provide information about these factors, which may be revised or supplemented in future reports to the SEC on Form 10-Q or 8-K.

* Twenty-seven selling days (S/D) for the October period this year and twenty-six for last year.
** Prior to Aug ’07, includes American Isuzu Motors, Inc., dealer deliveries of commercial vehicles distributed by GM as reported to GM by American Isuzu Motors Inc.
Effective Aug ’07, GM only includes GMC & Chevrolet dealer deliveries of commercial vehicles distributed by American Isuzu Motors, Inc.

CARS

TRUCKS