General Motors Company believes that the business depends most significantly on its employees. For example, skilled workers are typically more attracted to employers that offer concrete career development plans. In addition, the company has employee-engagement initiatives to encourage employees to get involved in programs beyond the organization, such as sustainability projects in collaboration with other businesses and with governments. This stakeholder group has interests in product pricing, design, and quality.
Operator  Ladies and gentlemen, thank you for standing by. Operator Instructions As a reminder, this conference call is being recorded Wednesday, July 25, Good morning, and thank you for joining us as we review GM's financial results for the second quarter of Our press release was issued this morning and the conference call materials are available on the GM Investor Relations website.
We are also broadcasting this call via webcast. Included in the charts that published this morning, we have the key takeaways from each chart in the notes pages in order to provide color on the results.
We will then open the line for questions from the analyst community. Before we begin, I would like to direct your attention to the forward-looking statements on the first page of the chart set. The content of our call will be governed by this language. I will now turn the call over to Mary Barra.
Thank you General motors competitive exposure joining the call. Before I start and comment on earnings, I would like to share that at General Motors, our thoughts are with Sergio Marchionne's family and friends as well as the entire FCA team over his sudden loss.
I think we all agree Sergio will be remembered for the many, many accomplishments he had in our industry. And now I'd like to move to the numbers. Our ROIC-adjusted was Story Continues Our financial results in the second quarter, while solid, did not meet our plan. We faced significant external challenges, including higher-than-expected commodity prices and currency devaluation in South America.
We have been taking actions to mitigate these headwinds and that will continue. However, we expect this volatility to extend into the second half, and Chuck and I will share more on this in a few minutes.
Before we do that, though, I do want to point out the key accomplishments in the quarter that demonstrate we are executing the business with strength and discipline. In addition, China equity income was a Q2 record, driven by record Cadillac and Baojun deliveries and strong market share.
At GM Financial, growth in earning assets and continued loyalty performance contributed to a record earnings before tax adjusted in the quarter.
Production of our all-new Chevrolet Silverado and GMC Sierra full-size pickups have begun on schedule, and we expect to begin delivering high-contented crew cab models to customers in August. To support our commitment to quality, these trucks have been subjected to the most stringent testing and validation in our history.
We've accumulated over 7 million miles in that testing and validation. In addition, we secured landmark deals and alliances that will help us redefine the future of personal mobility. Year-to-date, Chevrolet has posted record Trax, Equinox and Traverse deliveries.
With a double-digit pickup sales increase in the first half of the year, Chevrolet and GMC outpaced the industry. We expect increased launch-related costs in the second half of the year, and because of competitive launches, we expect pricing pressures to intensify, but we remain confident in our 20 years of market strength in China.
Due to established local and U. The GM and SoftBank investments are expected to provide the capital necessary to reach commercialization at scale. And we took an important step toward our all-electric future by partnering with Honda on next-generation battery development for our respective EV models.
As part of this deal, Honda will source battery cells and modules from GM, and this creates scale and manufacturing efficiencies. We began this year expecting pressure from raw material prices and foreign exchange rates, and while we have mitigated some of this effect, the challenge had become significantly greater than we originally expected, and we believe it will continue in the second half of the year.
Chuck will go deeper into the numbers and share our expectations for the rest of As Mary mentioned, while execution continues to be strong, we did experience a challenging second quarter, and we are facing greater-than-expected headwinds in commodity pricing and significant currency devaluations in South America.
These results are below our expectations. We expect pricing performance to improve as we progress through the launch of our new trucks later in the year.
And as we look into the second half, we remain focused on being disciplined from an incentive spending perspective.
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General Motors has three primary objectives to be achieved through the use of hedging to manage the risk associated with foreign exchange exposure: •Reduction of cash flow and earnings volatility – this objective is associated with a conscious decision to hedge only transaction exposures (cash flows) and ignore translation exposures.
General Motors Competitive Exposure Sales Exposure DATA: To analyze the impact of the yen dollar exchange rate on. liability due to instrument with foreign currency exposure was $13 billion Also called economic exposure, this arises when Japanese automakers achieve cost savings and.
competitive exposure on the basis of approach suggested in the case.
The loss of valuation is taken as the quantified proxy for the discussed competitive exposure. Foreign Exchange Hedging Strategies at General Motors: Competitive Exposures Case Solution,Foreign Exchange Hedging Strategies at General Motors: Competitive Exposures Case Analysis, Foreign Exchange Hedging Strategies at General Motors: Competitive Exposures Case Study Solution, As multinational companies analyze and manage currency risks arising from the competitive .
GM Competative Exposure Case Summary In , General Motors was the world’s leading automaker Market share of 15% Annual sales of $ billion Earnings of $ billion GM had manufacturing operations in more than 30 countries and its vehicles were sold in around countries.
What is competitive exposure Exposure resulting from.