On Tuesday, the automaker announced that General Motors has revised its profit growth forecasts for the year, citing uncertainties stemming from President Trump’s trade policies.
This month, the Trump administration declared a 25% tariff on imported vehicles and plans to impose the same duty on imported parts starting Saturday. Typically, about half of GM’s sales in the U.S. come from vehicles manufactured overseas, primarily in Canada and Mexico.
During a conference call with reporters, Paul Jacobson, the company’s CFO, stated, “We prefer not to discuss figures that are mere speculation regarding the administration’s actions.”
He further emphasized that GM perceives the potential impact of Trump’s tariffs as “material,” indicating a significant influence on the company’s revenue this year.
GM reported a profit of $2.8 billion for the first quarter on Tuesday, reflecting a 7% decrease compared to the prior year. The profits were primarily driven by a 14% drop in earnings before North American interest and taxes, while the international business reported modest gains.
Previously, the company had forecasted net profits of $11.2 billion to $12.5 billion for 2025, which would effectively double last year’s net profit of $6 billion.
“We cannot rely on earlier projections,” Jacobson remarked.
Along with the 25% tariff on imported cars, the Trump administration has elevated tariffs on imported steel and aluminum, raising the costs of metals crucial for car manufacturing. Additionally, tariffs on China have increased significantly, with several other countries also facing higher duties, which have temporarily decreased to 10% for a 90-day period.
Jacobson described GM’s discussions with the Trump administration regarding tariffs as “productive,” though he declined to provide further details, stating, “I don’t want to appear as negotiating in public.” He expressed hope for greater clarity on the tariff situation within the automotive sector.
Jacobson noted that the tariffs only became effective on April 3, thus having a negligible effect on the company’s financial results for the first quarter. “We have a solid foundation for our operations,” he reported.
GM has previously stated plans to ramp up production of pickup trucks at its facility located near Fort Wayne, Indiana.
Source: www.nytimes.com
