Ladies and gentlemen, welcome to the General Motors Company First Quarter 2019 Earnings Conference Call. During the opening remarks, all participants will be in a listen-only mode. After the opening remarks, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference call is being recorded Tuesday, April 30th, 2019. I would now like to turn the conference over to Rocky Gupta, Treasurer and Vice President of Investor Relations.

Thanks Dorothy. Good morning and thank you for joining us as we review GM's financial results for the first quarter of 2019. Our press release was issued this morning and the conference call materials are available on the GM Investor Relations website. We're also broadcasting this call via webcast. I'm joined today by Mary Barra, GM's Chairman and CEO; Dhivya Suryadevara, GM's Executive Vice President and CFO; and a number of other executives. Before we begin, I'd 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.

Thanks Rocky and good morning everyone. Thanks for joining. Our Q1 results are as follows; net revenue of $34.9 billion; EBIT adjusted of $2.3 billion; EBIT adjusted margin of 6.6%; EPS diluted adjusted of $1.41; our automotive adjusted free cash flow was a negative $3.9 billion; and our return on invested capital adjusted was 23.8% on a trailing four-quarter basis. These results are in line with our outlook that we shared earlier this year. Q1 seasonality, full-size SUV production downtime, and reduced volumes in China impacted our results. We remain confident that our strong new vehicle launches and clean full-size trucks along with ongoing business transformation actions will help us deliver our full year commitment. Let's begin with our performance in North America. We generated the highest-ever first quarter average transaction prices on the strength of our trucks, SUVs, and crossover segments. Our Truck 1 strategy is focused on maximizing profitability by first introducing a richer mix of popular high-margin models like crew cabs followed by regular and double cabs. We are selling every truck we build. This strategy is also helping us grow share among higher priced trucks at the expense of our competitors. For example the GMC Sierra has gained four percentage points of share this year among models priced over $50,000. In addition year-over-year Q1 average transaction prices on our all-new light-duty crew cabs were nearly $5,800 higher than our outgoing model. Our truck launch continues to be well-positioned moving forward. We expect supplies of light-duty pickups will reach an optimal mix of cab styles and trims in the second quarter. In the second half of the year when industry truck sales are typically surging, we will introduce our 2020 Chevrolet Silverado and GMC Sierra heavy-duty pickups. These are very popular with commercial customers and they contribute…

Thanks Mary and good morning everybody. We delivered solid results in the first quarter of 2019 in line with our expectations, as we face traditional Q1 seasonality, lower volumes in China and downtime as we prepare for the launch of our full-size SUVs. The strong performance of our all-new Silverado and Sierra pickup trucks, and favorable impact from transformation actions offset some of these headwinds. With that, let's review the results in more detail. As Mary mentioned we generated Q1 results of $34.9 billion in net revenue, $2.3 billion in EBIT adjusted, 6.6% margin, $1.41 in EPS-diluted adjusted and a negative $3.9 billion in adjusted automotive free cash flow. The $1.41 EPS-diluted adjusted includes a $0.31 benefit from Lyft and PSA revaluations. Excluding the impact of these items, the core automotive performance was solid and in line with our expectations. The Q1 cash burn of $3.9 billion reflects normal seasonality and is consistent with the cash flow outlook provided earlier this year. Let's turn to North America. North America delivered EBIT adjusted of $1.9 billion and 6.9% margins despite, downtime for full-size SUVs, lower pension income, increased depreciation and commodity headwinds. The performance of our all-new light-duty crew cabs, strong mature cost performance and savings from our transformation actions partially offset these headwinds. The launch of our light-duty Silverado and Sierra trucks has been exceptionally strong, and it contributed favorably to volume, mix and price during the quarter. As Mary mentioned our launch strategy is focused on maximizing profitability. With our transition from old to new architectures, we released the constraint on crew cab capacity, and filled the pipelines with these high-feature high-content trucks. We're seeing strong ATPs, from the new trucks and disciplined -- incentives remain disciplined. We're not growing our traditional cab and powertrain variants. We expect share…

[Operator Instructions] Your first question comes from the line of Rod Lache with Wolfe Research.

Good morning, everybody. A – Mary Barra: Good morning.

I just had a couple of questions. One is on China. On your Q4 call, you mentioned that Q1 would be similar to Q4 as you worked on inventory. It's obviously a little bit better. But now you're talking about that inventory correction continuing into Q2 and it's sequentially weaker. I was hoping you might be able to give us some parameters or brackets around how we should be expecting the year to look and what's the magnitude of these adjustments if you were not to be correcting inventory. What's sort of the underlying profitability of the business? A – Mary Barra: Well, Rod. This is Mary. I think you, I mean, what I mentioned it's really key that we get some stability from all of the stimulus measures. Because what's happening right now is you see a lot of volatility. There's something talked about. It doesn't get finalized. That's creating a lot of uncertainty for customers. So we're looking for that volatility to get resolved and for decisions to be made because we think that's holding back volume. There are some I'll say green shoots in China that we're observing. And then second part is -- what's GM-specific is we have a number of I think very important launches coming in the second part of the year. And some of them even started in Q2. So it's hard for General Motors to put a bracket around it when it's an industry issue around giving the consumer confidence of what to expect from a stimulus perspective.

And if I could add a data point, Rod. In Q4 typically, we do have a higher level of launch costs. So you saw that in Q4 of 2018, we were impacted by about $100 million additional launch costs. So stripping that out in Q1 and we did take production actions of 20% year-over-year there is still as Mary mentioned work yet to do from an inventory rightsizing perspective. And we do see a path to making progress there in Q2 this year. And the rest of the year will be driven by launches as Mary mentioned.

Okay. Excluding the inventory correction I mean was there an inventory correction that occurred during Q1? So would the underlying profitability be better excluding that?

We had flat inventory -- dealer inventory flattish at the end of Q4 of 2018 versus Q1 of 2019. And yes, there were actions that were taken to address it production actions so the 20% that I mentioned. And because of the volatility that we have seen in China there is yet more work to do beyond what we did in Q1.

Can you just switch to the pickup truck rollout? At one point you talked about a $2 billion revenue upside and some new platform, was wondering if that's still the case. There's obviously been a bit of volatility on your market share performance since you've been transitioning now with a pretty low inventory so far in the regular and double cabs. What's the status of that objective?

Yes. So if you think back at the $2 billion there were a few points we made at that time. Firstly, the crew cab capacity in our K2 was constrained and we were running at below-industry averages from a crew cab perspective. And with the T1 architecture, we were able to release that constraint, so that we were able to increase our penetration from a crew cab standpoint by over 10 percentage points. So that was a huge driver as we talked about the revenue opportunity. We're very much in line from the additional revenue opportunity in crew cab mix. And frankly you're seeing that flow through in Q4 of 2018 and Q1 of 2019 as well as that's helped us offset some of the headwinds that we are seeing. In addition to that Rod, we do have capacity increases in T1 versus K2 that we had already built in. And from the light-duty standpoint we were able to increase capacity by a few couple of tens of thousands units and that drove tailwinds as well that was factored into the revenue opportunity of $2 billion. So between the crew cab mix and the additional capacity we are on track for the $2 billion revenue opportunity.

Great. And just one last quick one, you gave a range of $4.5 billion to $6 billion free cash flow. It's a pretty broad range. Whatever happens in China obviously wouldn't affect that this year since the dividends would come in next year from this. So how do you see that evolving? What are the factors that would drive upside or the high end or the low end of that forecast?

Yeah. I'd say two things. Obviously part of that is driven by the fact that we have an EPS range of $6.50 to $7. So there's the natural earnings range that comes with that. And in addition to that as you well know Rod it's a working capital-intensive business and we have $300 billion of commercial flows in and out happening every single year. And depending on production timing and of downtime actions that we're taking typically that tends to drive volatility in working capital. So I would say, its earnings-driven range plus the working capital seasonality that typically drives the cash flow range.

Okay. Great. Thank you.

Your next question comes from the line of Itay Michaeli with Citi.

Great. Thank you. Good morning. Just can you tell us what – this was on slide 16 on the GMNA walk. This quarter I noticed that the material majors of the cost offset the majors for pricing. I think the last few quarters you were positive on that. Can you talk about the twin factors there and how you think about that relationship in the next few quarters?

Yeah. So the material on majors and the pricing on majors were typically on the light-duty truck front. And as you take a step back and look at overall K2 versus overall T1 profitability we are able to command a lot more price from a light-duty T1 perspective compared to K2s. Mary mentioned our crew cab ATPs for instance are higher significantly year-over-year. And obviously there's content that's added in the vehicle. But from a life-cycle-to-life-cycle average perspective Itay that's how I would think about it in sort of quarter-to-quarter noise. I would say that were comparable from an EBIT standpoint for these trucks on a like-for-like truck basis. Obviously, there's upside coming from the mix and the volume that I talked about. But I would say that, the data point in one quarter is generally not indicative. It will get better between Q2 and Q4. The way to think about it is a higher variable profit perhaps offset by some of D&A leading to flat EBIT between the two trucks on a truck-to-truck basis through the life cycle of the entire truck.

That's very helpful. Thanks, Dhivya. And then just second question just on Cruise AV. Just how was progress in the first quarter relative to your expectation in the previous timetable for Cruise to try to deploy it by the end of the year? Just love to get an update there.

Sure. First I think we have to step back. We are very pleased with our position and we look at this as the greatest engineering challenge of our lifetime. You look at the societal benefits that will happen when we unlock this not to mention the multitrillion-dollar market potential. I think our approach in the way that we are doing this from a fully integrated perspective and really the only one attacking this and doing it that way and then the continued improvement in our rate of iteration, when I look at it I wouldn't trade our position with anyone else. We have set aggressive goals for the team to motivate them to work in a – as fast as possible and I think we've made remarkable progress to date. So we expect to maintain the leadership position we're in now. And we will be gated by safety. Safety will be the priority. And that's how we're looking at this.

That's very helpful. Thank you very much.

Your next question comes from the line of John Murphy with Bank of America Merrill Lynch.

Good morning, everybody. Just a first question on the outlook of $6.50 to $7 because I think there's some confusion in the market. And if we think about that range it excludes any revaluation from Lyft or the PSA warrants. Is that correct? Meaning on a year-over-year basis you would assume those as zero in that $6.50 to $7 range. Because I think there's some people that will think or looking at this as potential guide down with that $0.31 included. Is that correct?

That is correct. There is 0 in terms of profits or revaluation tailwinds that we're assuming in our $6.50 to $7 outlook. That's core operating performance if you will.

Got it. Okay. And then just a second question and I apologize to ask a simple cadence question. But if we look at the $1.10 operating EPS in the first quarter -- or if you normally seasonalize it, it would kind of get you in roughly $5 to $6 range, but if we think about the incremental product that's launching given that will create some upside. But specifically on the cost saves the $2.5 billion would be about $1.75 a year. If we think about three quarters of that that's $1.30 and that kind of gets us into the range quickly. I'm just trying to understand how much of the cost saves you think you'll realize of that $2.5 billion on a run rate basis in the second, third and fourth quarter, and if there was essentially nothing in the first quarter?

Sure. So in the first quarter in our performance/timing line item in our bridge, we pointed out that there was $1 billion favorable. Within that I would say, John, roughly about $400 million worth of transformational cost savings that flowed through in Q1. To your point, we do anticipate those ramping up more in Q2, Q3 and Q4. So call it $400 million in Q1 and then getting to the run rate of $2.25 billion, $2 billion to $2.5 billion that I'd outlined in January. We remain on track for that. And since it's front-end loaded the run rate number is pretty close to what you'll end up achieving in the calendar year as well. But taking a step back on your question on earnings cadence, there's a number of factors that are driving H2 performance being stronger than H1 performance. Importantly, if you think about the downtime we already took 23,000 units for full-size SUVs in Q1. And the HD downtime that I talked about in Q2, that we're expecting you're going to see that reverse itself. Obviously, we're not going to have SUV downtime for the rest of the year. And once the heavy duty downtime is taken, we're still expecting flat number of units for the whole calendar year, which means H2 truck production will be higher than H1 truck production. And that's what's in our forecast. So that's an important factor as you think about cadence. When you put that together with the transformational cost actions that are ramping up more in Q2, Q3 and Q4 and the launches that I mentioned from an XT6 perspective as well as Blazer those are all acting as tailwinds. And that's -- Q1 was very much in plan. And the guidance of $6.50 to $7 bakes in this cadence that I talked about which is driven by very specific action items that we have laid out that gives us confidence in our ability to achieve that. Hopefully, that's helpful.

That's very helpful. And then just two quick ones or one I think you meant, but I’d be so quick. But the positioning in HD currently with the current capacity, I mean, I was just wondering if you could sort of dimension sort of where you think you are in positioning and what the capacity currently is and where that is going in the second half of the year. Just maybe in some kind of numbers whether it be the capacity numbers or ATPs that you think you might be able to achieve or the step-up in ATPs just so we can understand the change in the HD business.

Yes. Between T1 and K2, we added some light-duty capacity and some heavy-duty capacity. Frankly, we're more constrained from an HD perspective than we were LDs. So we added about 40,000 units for HD and 20,000 units from an LD perspective. From -- this is comparing T1 to K2. Transaction prices obviously, typically, when -- this early in the launch you will see a lift in transaction prices and we do expect that. And from the perspective of the vehicle itself as we mentioned, we believe it's going to be exceptionally strong. And we think there's significant benefit from a transaction price perspective that will just come from the -- just the quality of the truck.

And just really lastly quickly. GM Financial dividend what's your expectation for this year and where do you think that goes?

The current expectation is flat GM Financial dividend year-over-year. You may recall we got $375 million last year baked into our outlook of flat expectations. We're going to have to see from a leverage standpoint and their earning assets and residual value how they pan out to see if there's any upside to that. But as of now our outlook is $375 million.

Great. Thank you very much.

Sure.

Your next question comes from the line of Adam Jonas with Morgan Stanley.

Thanks everybody. First question is on trucks. Clearly, a very, very strong full-size and HD truck environment. I mean we're hearing from you and many of your competitors that demand has outstripped supply. I guess looking ahead do you think -- as you look on your own supply versus demand footprint and then your competitors, how much better can this get? It strikes many on this call that maybe this is peak truck. I don't know if you subscribe to that and whether you can kind of hold the peak truck or whether you genuinely think know there is significant room for this industry to go in terms of pushing the mix in ATPs further moving into 2020.

Yes, Adam it's Dhivya. I will take a shot at that. You have heard us talk about how we believe that the truck market is quite different when you look at that versus the overall store. We have cited reasons like how the installed base is growing, the average age of the truck is growing at a faster pace than the average age of the overall light vehicle market. We do see a distinct data point in our use cases where customers are using it for commercial as well as personal purposes. And the fundamentals point to continuing strength from a truck perspective. The penetration are based at about 13% of the overall industry and you've seen that sort of flat over the last several years. And we are overall bullish because of the fundamentals that I mentioned from a truck standpoint. And within that, you've heard us talk about our own positioning as well and we're -- with the new launches we're very bullish on our T1 franchise.

Okay. Sounds like not peak truck. The second question on cost savings. So, if we're in an environment where global production's plateauing, China isn't the gift that keeps on giving any more let's say just for the sake of discussion that truck mix can grind higher, but it's pretty awesome. So, maybe to get a real delta in profits you got to attack costs. And you've been very proactive at attacking structural costs the measures that you announced late last year. My question is isn't there -- can you share some examples and maybe some opportunity you have to attack content costs and your purchase bill of materials? It strikes me -- again talking to your competitors as well that electronics costs for example and electromechanical costs around internal combustion architectures that may at the margin be antiquated are just a huge burden. I mean you talk to some of the folks in Germany 40% of their costs are electronics. I'm not saying you're that high, but can you -- can that stop? Can you start to attack that through design and your new electric architecture to the point where you can get savings from your suppliers to pitch in instead of you doing all the hard work in the factories? So, taking all of the tweaks -- all the tweaks to arm. Thanks.

Yes. Adam I think it's a really important point. And it's something we're focused on in every single region around the globe be it some of the work that we did in the first quarter in South America where the suppliers came to the party and -- but also we're working with them to make sure that we actually take cost out drive efficiencies so those cost downs are permanent. It's a culture in China with their efficiency up cost down. And you'll see that is something that they are continuing to work on in material costs contenting. Complexity reductions are all pieces of that. We're also -- have very specific initiatives in the United States. Looking at how do we take out cost today and do that with our suppliers instead of to our suppliers driving efficiencies, I'm really encouraged by the fact if you look at -- General Motors has really over the last several years and with the work that Steve Kiefer and his team built a very strong relationship with our suppliers. And looking at innovation, getting them involved early in the design phase so we get their best ideas is something we are definitely driving as well as a very focused effort on complexity reduction and focus on what customers want because it's a constant battle. Because you want to give the customer exactly what they want but you want to do it in the most efficient way. So, those are initiatives that are running across the company. We have assigned projects vice presidents responsible for it and they report out on a regular basis. So, completely agree and we're attacking it with quite a bit of energy.

I'm sure you will Mary. Thanks everybody.

Your next question comes from the line of Joseph Spak with RBC Capital Markets.

Thanks. Good morning everyone. Dhivya thanks for the color on the transformation savings in the quarter. I just want to be clear, is that -- that excludes some of the savings also that you -- the billing that you recognized in from Korea that's recognized in GMI?

That's right. The $400 million that I'd referenced, which is embedded in our $1 billion does exclude the Korean restructuring. So the apples-to-apples, Joe that I would think about is of the $4.5 billion that we said we were going to achieve by the end of 2020. And the $2 billion to $2.5 billion that we have laid out for this year, the portion that we have achieved in Q1 is that $400 million.

Okay. So then -- and then that's the -- and then if we just look at the GMNA results where it was I think that for you was $700 million. So basically that $400 million and that $700 million is the transformation savings and that ramps as you go through the year?

Yeah. There's a -- after $400 million GMNA ends up getting most of the savings. There's some that accrue to the other regions as well. And the other half of that I would say roughly is timing related. Obviously you're comparing one quarter and another quarter, and neither of which are run rate quarters. So there's some noise in there.

Right. And sorry if I missed this, but any change to the commodity outlook for the year?

We had said earlier this year that we would see $1 billion headwind from commodities and tariffs. There's a few items that are tailwinds, Joe as it relates to steel and aluminum backing up a little bit as well as delay in some of the T1 tariffs. There's also some headwinds from a palladium standpoint. And, obviously, we could see how the overall tariff environment plays out. We're still baking in the $1 billion. And as the environment changes, we will update you guys on that.

Okay. And then just quickly back to China. If we just compare versus the fourth quarter wholesales were down like 25%, but the net income margin and JV income was up. And you mentioned some of the work and I think you also mentioned maybe some benefit from some of the adjacencies. But any more detail you could provide as to what really drove that income higher despite the big sequential decline?

Well, I'd say there's -- Q4 did have the launch cost that I mentioned of about $100 million. And we've taken actions to right size inventory, nothing specific to add. The adjacencies are helping as well as the cost actions that Mary mentioned. We are intensely focused on cost from a China standpoint and there's been an even more increased effort given the market environment that's happening in China. So other than that I would just say continuing to work on inventory and into Q2 and you'll see that impact in -- playing out in Q2 as well.

Okay. Thank you.

Your next question comes from the line of David Tamberrino with Goldman Sachs.

Yeah, great. Let's head back to North America and just talk about pickup trucks. Within that segment right now it's just -- tactically it seems like there's a lot of inventory from both yourselves and your two main competitors. And one of your competitors refreshed their product already in the first quarter. You guys were shared owners. You're refreshing your heavy-duty for the back half but they are as well. And then you'll have a third competitor with a mid-cycle refresh coming. Just trying to wrap our heads around where the market share return is going to come for GM and just how you're thinking about your -- competing with the net market that certainly seems to have a little bit more supply.

Yeah Well, I'd just say from a share standpoint it's look we're still in the early innings from a launch perspective. And if you look at what we actually have already rolled out, its crew cabs. And as we go through the rest of Q2, we're going to see the work trucks coming in. We're going to see regular cabs, diesel as I pointed out as well as HD. And as Mary mentioned we're seeing share gains in the areas where we've already rolled out. Crew cabs are up 20% year-over-year. Sierra has taken four percentage points of share. And I think you got to see the mix normalized before you can get insight from the noise that you're seeing during the transition.

Okay. So the point being that as you get through 2Q and maybe finish the quarter you'll have more normalized double cabs, regular cabs and then your HD launching, which is where you'll see the share gains in the back half?

Yeah. I think that's a fair assumption. And, obviously, early days yet in April but we are still feeling as we're rolling out the other variants tailwinds from a share perspective.

I mean we just overall, David we are seeing growth even in -- as we go into the start of the second quarter. So we're confident in the truck. And as Dhivya said when we get the full mix out there and are competing across all segments, we expect to have our rightful share.

Understood. And then on the GMF perspective, the residual values, did those come in weaker than you expected? I think you had maybe down 4% of 5% assumed for the year. Is that still the case? Or you're seeing something a little worse a little better?

Residual value for Q1 were down about 2% and we're still anticipating 4% to 5% decline in the residual values year-over-year. And if you actually look at the Q1 performance, it was in line with our expectations. You had some puts and takes. In Q1 of 2018, it's important to note we had some one-time items from a GMF standpoint. So, it's not an apples-to-apples comparison. And our -- if you look at our earning asset growth as well as our revenue growth in GMF, that's per plan. And against that you have the residual value pressures and the credit pressures that I talked about, as well as that -- you got to -- it's important to note our funding plan tends to be lumpy. We go out in the market, raise unsecured and then the asset growth catches up to that. We did fund early on in this year and we are ahead in our unsecured plan which is also causing some headwinds from an interest -- net interest margin perspective. So you roll all that together, we see a flat year-over-year 2018 versus 2019. And you will see this normalize in the other quarters.

Okay. I got it. So even though the residual values will get worse -- or anticipated to get worse throughout the year you prefunded that interest cost headwind will be somewhat negated as you grow your balance sheet?

Yeah.

Okay. And then lastly, I know you got asked about it earlier from a Cruise perspective. But is there any update on timing, update on thinking as to when we can expect maybe a little bit more of an unveil or further update? Because I don't think we've had one for maybe a year and a half now since that November Investor Day on Cruise.

Yeah. I think you'll see updates later this year. And just from an overall, again, we are very pleased and -- with where we're at from a continuing rate of progress. I think many underestimate how important it is to use the deep integration that we're doing. Let me remind everybody that we have changed 40% of the components in the vehicle understanding what it takes to have true safety systems in the vehicle when you don't have a driver along with the fact that we're doing our testing in one of the most complex environments in the United States. And so when you put that together that's what gives us confidence that we've got a very strong position. We also have a very strong safety record. I mean, I think if you look at -- one example is we have Super Cruise. And Super Cruise is a technology that is being recognized -- externally winning a lot of awards from customer feedback once they have it. They're disappointed if they don't, because it's such a great feature. And we look and we develop and we monitor to our safety standards and that's what we're going to do. If this we’re able to launch without the driver we will. But I also want to remind everybody that's just the start. There is still much more to do to take costs down from all the technologies that is in the vehicle to advance the capability of the vehicle, so it can continue to be launched in other markets to create that multitrillion-dollar market potential. So safety will gate us. We see a huge opportunity. We think the path that we're on and the way in which we're developing this technology is critical.

Okay. Appreciate all, Dhivya. Thank you, Mary. Look forward to the update.

Your next question comes from the line of Ryan Brinkman with JPMorgan.

Hi. Good morning. Thanks for taking my question. Is there an update you can provide on the GM International restructuring front? When the transformation actions were announced in November, it was relayed seven plants would close. Five being in North America which were disclosed at that time, but two being I think unnamed international facilities. You've taken definitive action in Korea. China isn't the place we've really thought about you looking to reduce capacity. So should we think about South America as the next focus of your footprint actions? And how would you say you're progressing with regards to your restructuring actions in South America? And any updated thoughts on when consolidated IO might be able to reach breakeven?

So I don't have any more details to provide. I would tell you though, the plans from a GM International transformation are well underway. We just don't have anything to announce at that time but everything is still on track.

Okay. Thanks. And then looking at slide 16 in the appendix, can you talk about some of the factors that roll up into performance/timing driver that was a $700 million tailwind? How should we think about the proportion of that cost tailwind that relates to structural factors like the transformation or maybe more transient timing-related factors?

I would say about half and half. If you look at it, this was GM North America, right? From a company perspective, Ryan, we had $1 billion in performance and timing. I would say, roughly $200 million of that is commercial and technical savings that we typically achieve every year from a material cost standpoint. And -- so that, I think -- you can't think of that as transient, I would say, that's continuing. Of the remaining $800 million or so, from a company perspective, I'd say, half and half timing. Half timing and half transformational actions, benefit starting to flow through. The $700 million you're seeing in North America, you could take a bulk of what I just explained for the total company into the same dynamic, as rolling through the North America.

Okay. And then, just lastly, there's been a lot of pickup truck launch questions already, but maybe from a different perspective. There was increased media and investor attention during the quarter, relative to your market share in full-size trucks, with some observing that -- emphasizing profitability over volume. It served GM North America profit very well so far. But just a question, if maybe the pricing has been perhaps too disciplined. Can you parse out some of the nuance of this launch in terms of how you're thinking about volume relative to price and if there's any sort of counterpoints you would make on the market share front relative to availability of trim levels, et cetera.

Yes. I think, as you look at it, we are in transition. We're in launch and the launch is going extremely well. As we said before, we've started with a richer mix and we're seeing the performance already in crew cabs. And so, I think, you can't look at the first quarter and think that that's the performance that's going to be for the year. As Dhivya mentioned, we'll round out the entire lineup. That will give us opportunities, as we go through the year, not to mention the opportunities in heavy-duty trucks, the opportunities in additional volumes. So we will be appropriately disciplined and respond to the market appropriately. But we think we've got a really, really strong truck. We're just in the middle of launching all phases of it. And we're on track to our plan and we -- but we do understand where we should be from a positioning from an overall market share perspective and we're focused on that as well. But we're going to do it in a disciplined fashion. And I think, the way we've launched this has been very well thought-through to maximize profits and make sure we have the representation that we should and be highly profitable end of the truck mix.

That’s it. Thank you.

Your next question comes from the line of Brian Johnson with Barclays Capital.

Hi. I have two questions; kind of a housekeeping one again on pickups for Dhivya, then a broader question for Mary. Back to the question of the 400 pricing versus 400 materials costs, is crew cab and the higher crew cab, do you put that in the mix waterfall or into the pricing waterfall?

Well, it's really both. And to the extent that we have the mix -- the percentage mix of crew cabs being higher year-over-year, you will see a benefit in the mix bucket, Brian. The reason you're not seeing that this time is, it was offset by the full-size SUV downtime that we took as well, which is negative to mix. So mix is actually flat, but in reality it's a positive number that's being offset by the downtime dynamic that's happening. And the price aspect as well, to the extent that there's an increase in price, you'll see that in the price bucket. And you look at that in conjunction with the cost bucket to see what the material on majors was.

Okay. Thank you. And a question for Mary. I mean, we've talked over the years about the cultural change you did at GM and a greater focus on cost accountability, making sure you're in the right product and geographies to drive profit. But one thing I do hear from investors is, if they look at GM design, broadly speaking, both the vehicles, the interiors, the advertising it just doesn't, in some people's view, have the kind of pizzazz as you might see. I don't always like going back to Tesla, but it's not lost on some of us that one of your designer Elon's created their vehicle lineup. FILE the advertising it just doesn't, in some people's view, have the kind of pizzazz as you might see. I don't always like going back to Tesla, but it's not lost on some of us that one of your designer Elon's created their vehicle lineup. So just, how are you thinking about the state of design overall at GM? Is it an important differentiator? Or do you think it's more important to get capable vehicles out there and kind of play it more on the profit and the cost game? And if it is more important, what would you -- what are you trying to do to kind of move it to the next level? A – Mary Barra: I think it's incredibly important. You have to do everything to win in this market. And design is a very important piece of it. I think we have a very disciplined process where we clinic data and understand the customers in segment and what they're looking for, how they view products. Full-size truck is different than a Cadillac is different than a compact SUV like the Chevrolet Equinox. And so, we have a…

Your last question comes from the line of Colin Langan with UBS. Q – Colin Langan: Great, thanks for taking my question. Maybe just the first, can we just recap the cadence guidance? I just want make sure all my facts are right. The second half will be stronger than the first half. Q1 is the weakest. So that means Q2 will be slightly better excluding the mark-to-market on Lyft and PSA. And I'm not sure did you give a number of the downtime of the heavy-duty? I know in Q1, it was about 25,000 SUVs. Is there a number for Q2 downtime?

Yeah. So for your first question from a cadence standpoint, Q1 is the weakest. Q2 will be better than Q1. But H2, both Q3 and Q4 is stronger than Q1 and Q2, primarily driven by downtime. As you saw, we took 23,000 units in Q1 for full-size SUVs. And as you think about the second quarter from a HD standpoint, we're probably going to have roughly 25,000 units down as well. But that will be offset by the fact that you have absence of downtime in full-size SUVs as well as absence of downtime in our light duties, which we did take a week of downtime in light duties in our Silao plant in Q1. So putting all of that together, I'd say Colin, Q1 weakest, Q2 better than that, and H2 driven by volumes that I talked about before as well as the cost transformation actions. Both the Q3, Q4 is stronger than Q1 and Q2.

Got it. And just two last quick ones. How should we think about restructuring cash impact? Will we see that later in the year? And also what is your current guidance for the market in China? If I understand I think originally you had said, it would be about flat. I mean is that still what you think?

Yeah. So from a cash perspective, we're anticipating roughly $2 billion of total cash spend, and a bulk of that will be incurred in 2019. There's about $1.5 billion left to be paid yet this year, and there's a tail going into 2020 as well. And from a China outlook standpoint, Mary addressed it. Obviously, lots of volatility given what's going on, and we're going to have to see how the stimulus and the other measures play out.

Okay. Fair enough. Thanks for taking my question.

Thank you. I'd now like to turn the call over to Mary Barra for her closing remarks.

Thanks, everybody. I really appreciate your participation this morning on the call. I want to close by reiterating our confidence in our full-year outlook of earnings per share of $6.50 to $7 and free cash flow between $4.5 billion and $6 billion. I think we have a track record of delivering on our commitments despite the industry macro challenges. And as Dhivya had said, this quarter was in line with our expectations. As we move forward, we're going to continue to seize every opportunity to manage what is in our control. In the United States that means we're going to focus on flawlessly launching the next Phase, the heavy-duty full-size trucks our crossovers and our Cadillac vehicles. We're going to work to realize the 2019 transformational cost savings that we outlined last November that are on track. And we're going to capitalize on the healthy economy in this country. Globally, we're launching an aggressive new vehicle lineup in China, and we've secured the necessary concessions to further strengthen our Chevrolet franchise in Brazil. So while, we've done much of the foundational work to right-size the business and our portfolio, we know this transformation is far from over. And we also understand what's at stake, and more importantly, the tremendous opportunity that is ahead of us. And I really believe we have the leadership team. We have the vision, the discipline, the technology and the commitment, and culture to create this win and to create value for our shareholders. And that's what we focus on doing every day. So thank you very much. I appreciate your attention.

Ladies and gentlemen, that concludes the conference call for today. Thank you for joining.