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Standard & Poor's Affirms Ratings on General Motors

15 July 1998

Standard & Poor's Affirms Ratings on General Motors & Units Amid Strike

    TORONTO, July 15 -- Standard & Poor's today affirmed  its
ratings on General Motors Corp. General Motors Acceptance Corp.
(GMAC), and various related entities (see list below).
    However, Standard & Poor's continues to monitor developments relating to
strikes at two of GM's components plants.  These work stoppages have brought
the bulk of the company's vehicle production in North America to a halt.
Damage from the strikes has not been sufficient yet to call into question GM's
ratings, but, in the absence of a settlement, a CreditWatch review of GM's and
GMAC's ratings would be considered within the next few weeks.
    In monitoring the current situation, Standard & Poor's is placing
emphasis on the following considerations:

    -- The pressing need for GM to preserve its flexibility to continue to
       reduce the size of its work force to more competitive levels and to
       lessen the  disadvantage of its particularly high degree of vertical
       integration;
    -- The potential for exacerbation of GM's already-problematic labour
       relations, heightening the risks posed by labour disputes at other
       local operating units and by the expiration in September, 1999 of the
       national contracts with its principal unions;
    -- The adverse impact of the production curtailment on GM's market share
       and the potential for disruption of planned new product launches.
       Solidification of GM's market share had been an important assumption
       underpinning the current rating;
    -- The mounting financial impact. In the quarter ended June 30, 1998
       costs related to the strikes are estimated to have totalled a
       substantial $1.18  billion (after tax);

    Moreover, the related cash outflow has totalled several billion dollars.
Indeed, given relatively heavy capital spending this year to date, coupled
with share repurchases, the company's cash and equivalents (including readily
available funds in Voluntary Employees' Beneficiary Association (VEBA) trusts)
net of parent-level debt has dwindled to $3.0 billion at June 30 1998 from
$11.2 billion at yearend 1997.  Still, a portion of the negative earnings and
cash flow impact will reverse once production is resumed, and GM's financial
flexibility remains adequate for now.
    (Were the strikes to lead to a CreditWatch listing of GM's and GMAC's
ratings, ratings of GM's affiliate, Hughes Electronics Corp., and Hughes'
subsidiary, PanAmSat Corp., are not likely to be included.)

    OUTLOOK: STABLE
    Although GM's rating outlook remains stable, a CreditWatch review would
be considered within a few weeks in the absence of a settlement of the current
labour disputes.

                         OUTSTANDING AFFIRMED RATINGS

                                      Ratings

    General Motors Corp.
    Corporate credit rating              A
    Senior unsecured debt                A
    Preferred stock                      A-
    Equipment trust certificates         A
    Commercial paper                     A-1

    General Motors Acceptance Corp.
    Corporate credit rating              A
    Senior unsecured debt                A
    Commercial paper                     A-1

    Hughes Electronics Corp.
    Corporate credit rating              A-
    Commercial paper                     A-2

    PanAmSat Corp.
    Corporate credit rating              A-
    Senior unsecured debt                A-
    Bank loan                            A-