GM warns that tariffs will cut full-year profits by $4B – $5B

Takeaways

• General Motors warned that auto tariffs imposed by the Trump administration will negatively impact its full-year profits by $4 billion to $5 million.
• The automaker reduced its 2025 adjusted EBIT and adjusted earnings outlooks.
• GM has said that it has taken steps to offset the tariff effects of 30%.

General Motors (GM), America’s largest automaker, slashed its profit forecasts Thursday after warning new Trump administration tariffs on autos would have a $4-$5 billion impact. The company did say it had a plan in place to offset some of these effects.

GM’s new estimate for 2025 is $8.25 – $10.00 per share, down from the previous estimate of $11.00 – $12.00. It reduced its forecast for adjusted earnings before taxes, interest and fees (EBIT) from $13.7 to $15.7 to a range between $10.0 to $12.5 billion.

Even so, the company explained it expects to “offset a minimum 30% of this risk” by taking executive actions this week based upon U.S. production as well as the elimination tariff stacking. It added that it’s adjusted auto free-cash flow guidance “gives [us] the ability to continue investment in U.S. Innovation and Manufacturing.”

In a letter to shareholders, CEO Mary Barra noted that the carmaker has been in discussions with the president and his team since before the inauguration in January, and it looks forward "to maintaining our strong dialogue with the Administration on trade and other policies as they continue to evolve." Barra pointed out that in addition, GM has been having "ongoing discussions with key trade partners that may also have an impact."

The Chevrolet and Cadillac manufacturer reported better-than expected first-quarter results on Tuesday, but delayed updating its full-year outlook and its earnings call for two days due to uncertainty over auto tariffs.

General Motors shares fluctuated slightly in the early trading. The stock price has fallen by about 14% this year.