Trade War Turbulence: GM Amidst Uncertainty

General Motors retracts its annual forecast due to the unpredictability of the U.S. President's trade policies, despite strong quarterly results. The automaker halts share buybacks and warns of potential tariff impacts. Revenue increased by 2.3%, fueled by pre-tariff demand, but net income dipped by 6.6%.

Amid rising trade tensions, General Motors has withdrawn its annual forecast, citing the unpredictable repercussions of President Donald Trump's global tariff strategies. Despite initially strong quarterly results, shares of the Detroit-based automaker fell by approximately 2.6% in premarket trading.

For 2025, GM had projected net earnings between $11.2 billion and $12.5 billion, excluding potential car tariff impacts. The fluctuating tariff policies have cast uncertainty over the automotive industry, with analysts speculating a significant increase in new car prices. GM CFO Paul Jacobson noted significant future tariff impacts during a media call, advising against reliance on previous forecast figures and hinting at updated projections once tariff implications are clearer.

The economic situation prompted GM to temporarily halt its stock repurchase program, initially set for $2 billion by mid-year. However, the company still reported a 2.3% revenue increase to $44 billion, exceeding expectations, fueled by customer purchases ahead of potential price hikes. GM's net income dropped by 6.6% to $2.8 billion. The approaching 25% auto tariffs, predicted to add $108 billion in expenses for U.S. automakers, have already forced many companies to adjust their financial outlooks.

(With inputs from agencies.)