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Pensions And Other Postretirement Benefits
 12 Months Ended
Dec. 31, 2016
Compensation and Retirement Disclosure [Abstract]  
Pensions and Other Postretirement Benefits [Text Block]
Pensions and Other Postretirement Benefits
Employee Pension and Other Postretirement Benefit Plans

Defined Benefit Pension Plans Defined benefit pension plans covering eligible U.S. hourly employees (hired prior to October 2007) and Canadian hourly employees (hired prior to October 2016) generally provide benefits of negotiated, stated amounts for each year of service and supplemental benefits for employees who retire with 30 years of service before normal retirement age. The benefits provided by the defined benefit pension plans covering eligible U.S. (hired prior to January 1, 2001) and Canadian salaried employees and employees in certain other non-U.S. locations are generally based on years of service and compensation history. Accrual of defined pension benefits ceased in 2012 for U.S. and Canadian salaried employees. There is also an unfunded nonqualified pension plan covering primarily U.S. executives for service prior to January 1, 2007 and it is based on an “excess plan” for service after that date.

The funding policy for qualified defined benefit pension plans is to contribute annually not less than the minimum required by applicable laws and regulations or to directly pay benefit payments where appropriate. In the year ended December 31, 2016 all legal funding requirements were met; additionally we made discretionary contributions to our U.S. hourly pension plan of $2.0 billion. These discretionary contributions were funded with the net proceeds from the issuance of the automotive senior unsecured notes described in Note 13. The following table summarizes contributions made to the defined benefit pension plans:
 
Years Ended December 31,
 
2016
 
2015
 
2014
U.S. hourly and salaried
$
2,054

 
$
95

 
$
143

Non-U.S.
1,033

 
1,120

 
770

Total
$
3,087

 
$
1,215

 
$
913


We expect to contribute $73 million to our U.S. non-qualified plans and $970 million to our non-U.S. pension plans in 2017.

Based on our current assumptions, over the next five years we expect no significant mandatory contributions to our U.S. qualified pension plans and mandatory contributions totaling $1.8 billion to our Canada and U.K. pension plans.

Other Postretirement Benefit Plans Certain hourly and salaried defined benefit plans provide postretirement medical, dental, legal service and life insurance to eligible U.S. and Canadian retirees and their eligible dependents. Certain other non-U.S. subsidiaries have postretirement benefit plans, although most non-U.S. employees are covered by government sponsored or administered programs. We made contributions to the U.S. OPEB plans of $335 million, $340 million and $354 million in the years ended December 31, 2016, 2015 and 2014. Plan participants' contributions were insignificant in the years ended December 31, 2016, 2015 and 2014.

Defined Contribution Plans We have defined contribution plans for eligible U.S. salaried and hourly employees that provide discretionary matching contributions. Contributions are also made to certain non-U.S. defined contribution plans. We made contributions to our defined contribution plans of $594 million, $535 million and $513 million in the years ended December 31, 2016, 2015 and 2014.

Significant Plan Amendments, Benefit Modifications and Related Events

Other Remeasurements We incorporated the mortality improvement tables issued by the Society of Actuaries (SOA) in the three months ended December 31, 2016 that lowered life expectancies and thereby indicated the amount of estimated aggregate benefit payments to our U.S. pension plans' participants was decreasing. This change in assumption decreased the December 31, 2016 U.S. pension and OPEB plans’ obligations by $888 million. In the three months ended December 31, 2014 the SOA issued new mortality and mortality improvement tables that raised life expectancies and thereby indicated the amount of estimated aggregate benefit payments to our U.S. pension plans' participants was increasing. We incorporated these SOA mortality and mortality improvement tables into our December 31, 2014 measurement of our U.S. pension and OPEB plans' benefit obligations. The change in these assumptions increased the December 31, 2014 U.S. pension and OPEB plans' obligations by $2.2 billion.

Pension and OPEB Obligations and Plan Assets
 
Year Ended December 31, 2016
 
Year Ended December 31, 2015
 
Pension Benefits
 
Global OPEB Plans
 
Pension Benefits
 
Global OPEB Plans
 
U.S.
 
Non-U.S.
 
 
U.S.
 
Non-U.S.
 
Change in benefit obligations
 
 
 
 
 
 
 
 
 
 
 
Beginning benefit obligation
$
71,486

 
$
23,763

 
$
6,066

 
$
76,724

 
$
27,897

 
$
6,625

Service cost
220

 
371

 
18

 
272

 
405

 
24

Interest cost
2,212

 
578

 
201

 
2,754

 
763

 
238

Actuarial (gains) losses
416

 
1,508

 
230

 
(2,623
)
 
(256
)
 
(209
)
Benefits paid
(5,507
)
 
(1,474
)
 
(400
)
 
(5,641
)
 
(1,332
)
 
(407
)
Foreign currency translation adjustments
—

 
(638
)
 
45

 
—

 
(3,332
)
 
(225
)
Curtailments, settlements and other
—

 
(58
)
 
20

 
—

 
(382
)
 
20

Ending benefit obligation
68,827

 
24,050

 
6,180

 
71,486

 
23,763

 
6,066

Change in plan assets
 
 
 
 
 
 
 
 
 
 
 
Beginning fair value of plan assets
61,072

 
12,990

 
—

 
65,823

 
14,669

 
—

Actual return on plan assets
4,004

 
762

 
—

 
795

 
997

 
—

Employer contributions
2,054

 
1,033

 
378

 
95

 
1,120

 
385

Benefits paid
(5,507
)
 
(1,474
)
 
(400
)
 
(5,641
)
 
(1,332
)
 
(407
)
Foreign currency translation adjustments
—

 
(232
)
 
—

 
—

 
(2,017
)
 
—

Settlements and other
(1
)
 
(81
)
 
22

 
—

 
(447
)
 
22

Ending fair value of plan assets
61,622

 
12,998

 
—

 
61,072

 
12,990

 
—

Ending funded status
$
(7,205
)
 
$
(11,052
)
 
$
(6,180
)
 
$
(10,414
)
 
$
(10,773
)
 
$
(6,066
)
Amounts recorded in the consolidated balance sheets
 
 
 
 
 
 
 
 
 
 
 
Non-current assets
$
—

 
$
91

 
$
—

 
$
—

 
$
125

 
$
—

Current liabilities
(73
)
 
(324
)
 
(377
)
 
(67
)
 
(334
)
 
(381
)
Non-current liabilities
(7,132
)
 
(10,819
)
 
(5,803
)
 
(10,347
)
 
(10,564
)
 
(5,685
)
Net amount recorded
$
(7,205
)
 
$
(11,052
)
 
$
(6,180
)
 
$
(10,414
)
 
$
(10,773
)
 
$
(6,066
)
Amounts recorded in Accumulated other comprehensive loss
 
 
 
 
 
 
 
 
 
 
 
Net actuarial gain (loss)
$
55

 
$
(4,904
)
 
$
(901
)
 
$
116

 
$
(3,796
)
 
$
(689
)
Net prior service (cost) credit
27

 
(21
)
 
54

 
31

 
(33
)
 
63

Total recorded in Accumulated other comprehensive loss
$
82

 
$
(4,925
)
 
$
(847
)
 
$
147

 
$
(3,829
)
 
$
(626
)


The following table summarizes the total accumulated benefit obligations (ABO), the ABO and fair value of plan assets for defined benefit pension plans with ABO in excess of plan assets, and the PBO and fair value of plan assets for defined benefit pension plans with PBO in excess of plan assets:
 
December 31, 2016
 
December 31, 2015
 
U.S.
 
Non-U.S.
 
U.S.
 
Non-U.S.
ABO
$
68,813

 
$
23,711

 
$
71,475

 
$
23,388

Plans with ABO in excess of plan assets
 
 
 
 
 
 
 
ABO
$
68,813

 
$
23,010

 
$
71,475

 
$
22,683

Fair value of plan assets
$
61,622

 
$
12,205

 
$
61,072

 
$
12,160

Plans with PBO in excess of plan assets
 
 
 
 
 
 
 
PBO
$
68,827

 
$
23,352

 
$
71,486

 
$
23,052

Fair value of plan assets
$
61,622

 
$
12,209

 
$
61,072

 
$
12,170



The following table summarizes the components of net periodic pension and OPEB expense along with the assumptions used to determine benefit obligations:
 
Year Ended December 31, 2016
 
Year Ended December 31, 2015
 
Year Ended December 31, 2014
 
Pension Benefits
 
Global OPEB Plans
 
Pension Benefits
 
Global OPEB Plans
 
Pension Benefits
 
Global OPEB Plans
 
U.S.
 
Non-U.S.
 
 
U.S.
 
Non-U.S.
 
 
U.S.
 
Non-U.S.
 
Components of expense
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service cost
$
381

 
$
390

 
$
18

 
$
406

 
$
431

 
$
24

 
$
380

 
$
389

 
$
23

Interest cost
2,212

 
578

 
201

 
2,754

 
763

 
238

 
3,060

 
1,031

 
273

Expected return on plan assets
(3,778
)
 
(737
)
 
—

 
(3,896
)
 
(798
)
 
—

 
(3,914
)
 
(873
)
 
—

Amortization of prior service cost (credit)
(4
)
 
14

 
(13
)
 
(4
)
 
15

 
(14
)
 
(4
)
 
17

 
(16
)
Amortization of net actuarial (gains) losses
(25
)
 
189

 
19

 
8

 
233

 
37

 
(91
)
 
154

 
8

Curtailments, settlements and other(a)
—

 
2

 
—

 
—

 
124

 
—

 
(1
)
 
3

 
—

Net periodic pension and OPEB (income) expense
$
(1,214
)
 
$
436

 
$
225

 
$
(732
)
 
$
768

 
$
285

 
$
(570
)
 
$
721

 
$
288

Weighted-average assumptions used to determine benefit obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Discount rate
3.92
%
 
2.72
%
 
3.93
%
 
4.06
%
 
3.20
%
 
4.13
%
 
3.73
%
 
3.14
%
 
3.83
%
Rate of compensation increase(b)
N/A

 
2.79
%
 
N/A

 
N/A

 
2.79
%
 
4.21
%
 
N/A

 
2.85
%
 
4.21
%
Weighted-average assumptions used to determine net expense
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Discount rate
3.36
%
 
2.99
%
 
3.49
%
 
3.73
%
 
3.15
%
 
3.83
%
 
4.46
%
 
4.10
%
 
4.56
%
Expected rate of return on plan assets
6.33
%
 
5.98
%
 
N/A

 
6.38
%
 
6.23
%
 
N/A

 
6.53
%
 
6.28
%
 
N/A

Rate of compensation increase(b)
N/A

 
2.80
%
 
N/A

 
N/A

 
2.85
%
 
4.21
%
 
N/A

 
2.90
%
 
4.21
%
_________
(a)
The curtailment charges recorded in the year ended December 31, 2015 were due primarily to the GM Canada hourly pension plan that was remeasured as a result of a voluntary separation program.
(b)
As a result of ceasing the accrual of additional benefits for salaried plan participants, the rate of compensation increase does not have a significant effect on our U.S. pension and OPEB plans.

Effective January 2016 the discount rate used to determine the service cost and interest cost for our pension and OPEB plans was based on individual annual yield curve rates. This refinement was considered a change in estimate and applied prospectively. The use of the individual annual yield curve rates has reduced the service cost and interest cost by $768 million in the year ended December 31, 2016, which was offset in the actuarial gains and losses upon the December 31, 2016 remeasurement of the plans' obligations.

U.S. pension plan service cost includes administrative expenses and Pension Benefit Guarantee Corporation premiums which were insignificant in the years ended December 31, 2016, 2015 and 2014. Weighted-average assumptions used to determine net expense are determined at the beginning of the period and updated for remeasurements. Non-U.S. pension plan administrative expenses included in service cost were insignificant in the years ended December 31, 2016, 2015 and 2014.

Estimated amounts to be amortized from Accumulated other comprehensive loss into net periodic benefit cost in the year ending December 31, 2017 based on December 31, 2016 plan measurements are $261 million, consisting primarily of amortization of the net actuarial loss in the non-U.S. pension plans.
 
 
 
 
 
 
 
 

Assumptions

Investment Strategies and Long-Term Rate of Return Detailed periodic studies are conducted by our internal asset management group as well as outside actuaries and are used to determine the long-term strategic mix among asset classes, risk mitigation strategies and the expected long-term return on asset assumptions for the U.S. pension plans. The U.S. study includes a review of alternative asset allocation and risk mitigation strategies, anticipated future long-term performance and risk of the individual asset classes that comprise the plans' asset mix. Similar studies are performed for the significant non-U.S. pension plans with the assistance of outside actuaries and asset managers. While the studies incorporate data from recent plan performance and historical returns, the expected long-term return on plan asset assumptions are determined based on long-term prospective rates of return.

We continue to pursue various options to fund and derisk our pension plans, including continued changes to the pension asset portfolio mix to reduce funded status volatility. The strategic asset mix and risk mitigation strategies for the plans are tailored specifically for each plan. Individual plans have distinct liabilities, liquidity needs and regulatory requirements. Consequently there are different investment policies set by individual plan fiduciaries. Although investment policies and risk mitigation strategies may differ among plans, each investment strategy is considered to be appropriate in the context of the specific factors affecting each plan.

In setting new strategic asset mixes, consideration is given to the likelihood that the selected asset mixes will effectively fund the projected pension plan liabilities, while aligning with the risk tolerance of the plans' fiduciaries. The strategic asset mixes for U.S. defined benefit pension plans are increasingly designed to satisfy the competing objectives of improving funded positions (market value of assets equal to or greater than the present value of the liabilities) and mitigating the possibility of a deterioration in funded status.

Derivatives may be used to provide cost effective solutions for rebalancing investment portfolios, increasing or decreasing exposure to various asset classes and for mitigating risks, primarily interest rate and currency risks. Equity and fixed income managers are permitted to utilize derivatives as efficient substitutes for traditional securities. Interest rate derivatives may be used to adjust portfolio duration to align with a plan's targeted investment policy. Alternative investment managers are permitted to employ leverage, including through the use of derivatives, which may alter economic exposure.

In December 2016 an investment policy study was completed for the U.S. pension plans. The study resulted in new target asset allocations being approved for the U.S. pension plans with resulting changes to the expected long-term rate of return on assets. The weighted-average long-term rate of return on assets decreased from 6.3% at December 31, 2015 to 6.2% at December 31, 2016. The expected long-term rate of return on plan assets used in determining pension expense for non-U.S. plans is determined in a similar manner to the U.S. plans.

Target Allocation Percentages The following table summarizes the target allocations by asset category for U.S. and non-U.S. defined benefit pension plans:
 
December 31, 2016
 
December 31, 2015
 
U.S.
 
Non-U.S.
 
U.S.
 
Non-U.S.
Equity
15
%
 
21
%
 
14
%
 
21
%
Debt
61
%
 
50
%
 
62
%
 
50
%
Other(a)
24
%
 
29
%
 
24
%
 
29
%
Total
100
%
 
100
%
 
100
%
 
100
%

__________
(a)
Primarily includes private equity, real estate and absolute return strategies which mainly consist of hedge funds.

Assets and Fair Value Measurements The following tables summarize the fair value of U.S. and non-U.S. defined benefit pension plan assets by asset class:
 
December 31, 2016
 
December 31, 2015
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
U.S. Pension Plan Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common and preferred stocks
$
8,288

 
$
35

 
$
3

 
$
8,326

 
$
7,637

 
$
18

 
$
8

 
$
7,663

Government and agency debt securities(a)
—

 
11,374

 
—

 
11,374

 
—

 
14,318

 
—

 
14,318

Corporate and other debt securities
—

 
25,452

 
—

 
25,452

 
—

 
22,963

 
1

 
22,964

Other investments, net
486

 
288

 
403

 
1,177

 
466

 
130

 
472

 
1,068

Net plan assets subject to leveling
$
8,774

 
$
37,149

 
$
406

 
46,329

 
$
8,103

 
$
37,429

 
$
481

 
46,013

Plan assets measured at net asset value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment funds
 
 
 
 
 
 
6,509

 
 
 
 
 
 
 
6,321

Private equity and debt investments
 
 
 
 
 
 
4,012

 
 
 
 
 
 
 
4,529

Real estate investments
 
 
 
 
 
 
3,634

 
 
 
 
 
 
 
3,828

Total plan assets measured at net asset value
 
 
 
 
 
 
14,155

 
 
 
 
 
 
 
14,678

Other plan assets, net(b)
 
 
 
 
 
 
1,138

 
 
 
 
 
 
 
381

Net plan assets
 
 
 
 
 
 
$
61,622

 
 
 
 
 
 
 
$
61,072


 
December 31, 2016
 
December 31, 2015
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Non-U.S. Pension Plan Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common and preferred stocks
$
984

 
$
3

 
$
—

 
$
987

 
$
1,079

 
$
1

 
$
1

 
$
1,081

Government and agency debt securities(a)
—

 
3,222

 
—

 
3,222

 
—

 
3,258

 
—

 
3,258

Corporate and other debt securities
—

 
2,044

 
3

 
2,047

 
—

 
1,953

 
1

 
1,954

Other investments, net
37

 
152

 
595

 
784

 
47

 
47

 
642

 
736

Net plan assets subject to leveling
$
1,021

 
$
5,421

 
$
598

 
7,040

 
$
1,126

 
$
5,259

 
$
644

 
7,029

Plan assets measured at net asset value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment funds
 
 
 
 
 
 
4,449

 
 
 
 
 
 
 
4,475

Private equity and debt investments
 
 
 
 
 
 
546

 
 
 
 
 
 
 
529

Real estate investments
 
 
 
 
 
 
1,092

 
 
 
 
 
 
 
1,095

Total plan assets measured at net asset value
 
 
 
 
 
 
6,087

 
 
 
 
 
 
 
6,099

Other plan assets (liabilities), net(b)
 
 
 
 
 
 
(129
)
 
 
 
 
 
 
 
(138
)
Net plan assets
 
 
 
 
 
 
$
12,998

 
 
 
 
 
 
 
$
12,990

__________
(a)
Includes U.S. and sovereign government and agency issues.
(b)
Cash held by the plans, net of amounts receivable/payable for unsettled security transactions and payables for investment manager fees, custody fees and other expenses.

The activity attributable to U.S. and non-U.S. Level 3 defined benefit pension plan investments was insignificant in the years ended December 31, 2016 and 2015.
 
Alternative Investment Strategies Investment funds include hedge funds, funds of hedge funds, equity funds and fixed income funds. Hedge funds and funds of hedge funds managers typically seek to achieve their objectives by allocating capital across a broad array of funds and/or investment managers. Equity funds invest in U.S. common and preferred stocks as well as similar equity securities issued by companies incorporated, listed or domiciled in developed and/or emerging market countries. Fixed income funds include investments in high quality funds and, to a lesser extent, high yield funds. High quality fixed income funds invest in government securities, investment-grade corporate bonds and mortgage and asset-backed securities. High yield fixed income funds invest in high yield fixed income securities issued by corporations which are rated below investment grade. Other investment funds also included in this category primarily represent multi-strategy funds that invest in broadly diversified portfolios of equity, fixed income and derivative instruments.

Private equity and debt investments primarily consist of investments in private equity and debt funds. These investments provide exposure to and benefit from long-term equity investments in private companies, including leveraged buy-outs, venture capital and distressed debt strategies.

Real estate investments include funds that invest in entities which are primarily engaged in the ownership, acquisition, development, financing, sale and/or management of income-producing real estate properties, both commercial and residential. These funds typically seek long-term growth of capital and current income that is above average relative to public equity funds.

Significant Concentrations of Risk The assets of the pension plans include certain investment funds, private equity and debt investments and real estate investments. Investment managers may be unable to quickly sell or redeem some or all of these investments at an amount close or equal to fair value in order to meet a plan's liquidity requirements or to respond to specific events such as deterioration in the creditworthiness of any particular issuer or counterparty.

Illiquid investments held by the plans are generally long-term investments that complement the long-term nature of pension obligations and are not used to fund benefit payments when currently due. Plan management monitors liquidity risk on an ongoing basis and has procedures in place that are designed to maintain flexibility in addressing plan-specific, broader industry and market liquidity events.

The pension plans may invest in financial instruments denominated in foreign currencies and may be exposed to risks that the foreign currency exchange rates might change in a manner that has an adverse effect on the value of the foreign currency denominated assets or liabilities. Forward currency contracts may be used to manage and mitigate foreign currency risk.

The pension plans may invest in debt securities for which any change in the relevant interest rates for particular securities might result in an investment manager being unable to secure similar returns upon the maturity or the sale of securities. In addition changes to prevailing interest rates or changes in expectations of future interest rates might result in an increase or decrease in the fair value of the securities held. Interest rate swaps and other financial derivative instruments may be used to manage interest rate risk.

Benefit Payments Benefits for most U.S. pension plans and certain non-U.S. pension plans are paid out of plan assets rather than our Cash and cash equivalents. The following table summarizes net benefit payments expected to be paid in the future, which include assumptions related to estimated future employee service:
 
Pension Benefits
 
Other Benefits
 
U.S. Plans
 
Non-U.S. Plans
 
Global Plans
2017
$
5,476

 
$
1,382

 
$
380

2018
$
5,195

 
$
1,247

 
$
374

2019
$
5,068

 
$
1,242

 
$
369

2020
$
4,953

 
$
1,234

 
$
365

2021
$
4,762

 
$
1,230

 
$
362

2022 - 2026
$
22,157

 
$
5,909

 
$
1,775