Although General Motors Co.'s (GM's) earnings performance in 2018 has been strong in China, led by its Cadillac and Chevrolet brands, year-over-year volumes were down nearly 10% in 2018, and--notably--down 25% in the fourth quarter of 2018. Though the effects of a slowdown seem pronounced in Tier 3-5 cities, where GM has lesser presence, ongoing geopolitical and trade tensions could impact localized operations of most automakers. We incorporate increased downside risks to our 2019 forecasts (industry light vehicle sales increase 1%-2%) in the world's largest automotive market. Continued price pressure, increased regulatory costs, and trade tension could lead to somewhat lower equity income for GM in 2019-2020 compared to prior years. We expect better earnings resiliency following recent efforts to
