General Motors is lowering its profit expectations for the year as the carmaker braces for the potential impact from auto tariffs being rolled out by the US.
GM announced early this week that it was reassessing its expectations for 2025 due to tariffs. The company said at the time that its initial full-year financial outlook didn’t contemplate their potential impact, reports AP.
On Thursday the automaker said that it now foresees full-year adjusted earnings before interest and taxes in a range of $10 billion to $12.5 billion. The guidance includes a current tariff exposure of $4 billion to $5 billion.
GM previously predicted 2025 adjusted EBIT between $13.7 billion and $15.7 billion.
The revised forecast comes after President Donald Trump signed executive orders Tuesday to relax some of his 25% tariffs on automobiles and auto parts, a significant reversal as the import taxes threatened to hurt domestic manufacturers.
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Automakers and independent analyses have indicated that the tariffs could raise prices, reduce sales and make US production less competitive worldwide. Trump portrayed the changes as a bridge toward automakers moving more production into the United States.
Still, it remains unclear what impact Trump’s broader tariffs will have on the US economy and auto sales. Most economists say the tariffs — which could ultimately hit most imports — would raise prices and slow economic growth, possibly hurting auto sales despite the relief that the administration intends to offer on its previous policies.
In a letter to shareholders on Thursday, General Motors CEO Mary Barra said that the automaker looks forward to maintaining its strong dialogue with the Trump administration on trade and other evolving policies.
“As you know, there are ongoing discussions with key trade partners that may also have an impact,” she said. “We will continue to be nimble and disciplined and update you as we know more.”
Shares of GM climbed more than 2% before the opening bell.