General Motors automotive cut its benefits forecasts for all 2025 due to an exhibition of up to 5 billion dollars To Donald Trump’s cars, one of the greatest financial impacts revealed by any company to date to the commercial ‘war’.
The automobile manufacturer now foresees that Profit before interest and taxes are between 10,000 and 12,5 billion dollarsbelow its January initial forecast of up to 15,700 million dollars.
Earlier this week, Trump issued what he himself described as a relief for car manufacturers by reducing some tariffs on vehicles and imported parts. Even so, General Motors provides a negative impact on their profits in 2025 unless trade agreements are reached that reduce the manufacturer’s exhibition.
“We hope to maintain A solid dialogue with trade on trade and other policies As they evolve, ”he said The executive director, Mary Barthis Thursday, May 1 in a letter to the shareholders.
“As you know, there are ongoing conversations with key commercial partners who could also have an impact. We will continue to be agile and disciplined and we will keep them informed as we know more,” he added.
Just two days ago, General Motors suspended his forecasts and postponed a telephone conference with analysts on results, claiming that he wanted to wait for the Trump administration to announce more details about tariffs.
GM shares fell 0.03 percent at 9:34 am in New York. Automotive titles have dropped 15 percent this year. Barclays analysts said the forecasts were “better than expected.”
What is the ‘relief’ of Trump tariff to car manufacturers?
The company said he hopes to compensate at least 30 percent of its tariff exposure through production compensation in the United States. Their forecast assumes that current cars prices will remain relatively stable during the rest of the year.
General Motors has been working to reduce its exposure to tariffs and minimize the impact on their profits. One of the measures is Increase the production of pickup trucks in an Indiana plant to meet demand with fewer trucks subject to tariffs.
The company also took measures to preserve its liquidity. GM cut capital spending in the first quarter at 900 million dollars, to 1,800 million dollars.
GM announced on April 29 that it exceeded Wall Street estimates with a gain of $ 2.78 per share, but The profits decreased due to a lower truck production and exchange costs. Barra declared analysts at the reprogrammed telephone conference for the presentation of results that Donald Trump’s tariffs had a “small impact” in the results of the first quarter.
Trump signed on Tuesday, April 29, two executive orders that reduced their initial tariffs on vehicles and auto parts. The first executive order exempt vehicles from separate tariffs on aluminum and steelso that the levies on auto parts and metals will not accumulate.
He also modified the 25 percent tariff on imported auto parts, which enters into force on May 3. Automobile manufacturers that produce and sell cars finished in the US can request compensation of up to 3.75 percent of the value of vehicles made in the United States.
This compensation will be reduced by up to 2.5 percent of the value of these vehicles and will be eliminated the following year. Compensation will be available for cars produced after April 3.
Automobile manufacturers still face A 25 percent tariff on imported vehicleswhich harms GM, since it manufactures several popular models in Canada, Mexico and South Korea. The company has a plant in Canada and another in Mexico where it manufactures its pickup trucks, which are profitable and of greater sale. Its most affordable models, the family SUV Chevrolet Equinox and the Compact SUV Chevy Traxthey are also manufactured outside the United States.
