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GM boosts full-year outlook as it foresees a smaller impact from tariffs and 3Q results top Street

[October 21, 2025] By MICHELLE CHAPMAN

General Motors anticipates a smaller impact from tariffs and is boosting its full-year adjusted earnings forecast as its third-quarter performance topped Wall Street's expectations.

Shares surged nearly 12% in early trading on Tuesday.

The automaker reduced its expectations for the full-year gross impact from tariffs to a range of $3.5 billion to $4.5 billion. Its previous guidance was $4 billion to $5 billion. GM anticipates its tariff mitigation actions will offset about 35% of the impact due to a lower tariff base.

On Friday President Donald Trump gave domestic automakers additional relief from tariffs on auto parts, extending what was supposed to have been a short-term rebate until 2030. It’s part of a proclamation Trump signed Friday that also made official a 25% import tax on medium and heavy duty trucks, starting Nov. 1.

The action reflected the administration’s efforts to use tariffs to promote American manufacturing while also trying to shield the auto sector from the higher costs that Trump’s import taxes have created for parts and raw materials.

“The MSRP offset program will help make U.S.-produced vehicles more competitive over the next five years, and GM is very well positioned as we invest to increase our already significant domestic sourcing and manufacturing footprint,” GM CEO Mary Barra said in a letter to shareholders.

GM previously announced $4 billion in capital investments to onshore production at plants in Tennessee, Kansas, and Michigan over the next two years. Barra said that once those investments are in place, the company plans to make more than 2 million vehicles per year in the U.S.

The automaker is also investing nearly $1 billion to build a new generation of advanced, fuel-efficient V8 engines in New York.

For the three months ended Sept. 30, GM earned $1.33 billion, or $1.35 per share. A year earlier the automaker earned $3.06 billion, or $2.68 per share.

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The company logo shines off the nose of an unsold 2022 Bolt electric vehicle on display in front of a Chevrolet dealership Sunday, Sept. 12, 2021, in Englewood, Colo. (AP Photo/David Zalubowski, File)

Earnings, adjusted for one-time gains and costs, were $2.80 per share. That easily beat the $2.28 per share that analysts surveyed by Zacks Investment Research were calling for.

Revenue totaled $48.59 billion, topping Wall Street's estimate of $44.27 billion.

GM now foresees full-year adjusted earnings between $9.75 and $10.50 per share. Its prior outlook was for $8.25 to $10 per share. Analysts polled by FactSet predict full-year earnings of $9.46 per share.

Barra also said Tuesday that GM is reassessing its electric vehicle capacity and manufacturing footprint.

The announcement comes a week after GM said that it would record a negative impact of $1.6 billion in the third quarter after tax incentives for EVs were slashed by the U.S. and rules governing emissions are relaxed.

The EV tax credit ended last month. The clean vehicle tax credit was worth $7,500 for new EVs and up to $4,000 for used ones.

“With the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned,” Barra said in her shareholder letter.

Aside from the charge in the third quarter, Barra said that the company expects future charges.

“By acting swiftly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond,” she said.

GM remains committed to its Cadillac, Chevrolet and GMC EVs, with Barra saying that the automaker anticipates their performance will improve, even in a smaller market.

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