{"id":15841,"date":"2025-07-22T16:34:08","date_gmt":"2025-07-22T16:34:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/15841\/"},"modified":"2025-07-22T16:34:08","modified_gmt":"2025-07-22T16:34:08","slug":"gms-second-quarter-profit-tumbles-on-1-1-billion-cost-from-trumps-tariffs","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/15841\/","title":{"rendered":"GM\u2019s second-quarter profit tumbles on $1.1-billion cost from Trump\u2019s tariffs"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

GM says it is sticking with previous statements that it will be able to mitigate 30 per cent of the tariff expense by shifting production to the U.S., cost-cutting and vehicle prices.Paul Sancya\/The Associated Press<\/p>\n

General Motors Co. GM-N<\/a> says U.S. tariffs cost it US$1.1-billion in the second quarter, reducing profit by 35 per cent, and warns the financial impact of President Donald Trump\u2019s trade policies is set to rise.<\/p>\n

The Detroit-based automaker previously said the tariffs will cost as much as $5-billion this year, with the greater impact felt in the second quarter. GM\u2019s chief financial officer Paul Jacobson says the overall costs of the duties is not expected to change this year, but the financial hit will increase in the third quarter as \u201cindirect\u201d tariffs on steel and aluminum are layered on. <\/p>\n

\u201cOur gross tariff impact remains unchanged at $4- to $5-billion this year as we continue to produce and import vehicles from Canada, Mexico, and Korea to avoid interruptions for our customers and dealers,\u201d Mr. Jacobson told analysts on a second-quarter earnings conference call on Tuesday. <\/p>\n

GM is sticking with previous statements that it will be able to mitigate 30 per cent of the tariff expense by shifting production to the U.S., cost-cutting and vehicle prices. <\/p>\n

\u201cOver time, we remain confident that our total tariff expense will come down as bilateral trade deals emerge and our sourcing and production adjustments are implemented,\u201d Mr. Jacobson said. <\/p>\n

For the three months ending on June 30, GM\u2019s profit fell to US$1.9-billion, or US$2.55 a share, from US$2.9-billion (US$3.06) from the same quarter a year earlier. The results topped analyst expectations. <\/p>\n

Revenue declined by almost 2 per cent to US$47.9-billion while profit margin slipped to 6 per cent from 4 per cent. <\/p>\n

GM\u2019s share price fell more than 6 per cent in mid-day trading on the New York Stock Exchange. <\/p>\n

Stellantis NV, maker of Jeep, Dodge and several other brands, said on Monday the tariffs have cost it US$349-million this year. <\/p>\n

Mr. Trump imposed 25-per-cent tariffs on the non-U.S. content in vehicles made in Canada, Mexico and elsewhere in April, declaring the move would spur manufacturers to build factories in the U.S. He doubled duties on steel and aluminum to 50 per cent, further raising costs for U.S. importers. <\/p>\n

Prime Minister Mark Carney has responded by laying 25-per-cent tariffs on the U.S. content of imported cars but spared the manufacturers that maintain production here. <\/p>\n

General Motors said in May it will cut one of three production shifts at its Oshawa Silverado pickup plant by the fall, laying off 700 employees. GM has hired hundreds of people at its Silverado plant in Fort Wayne, Ind., boosting production by 50,000 trucks a year. The automaker said this month it will suspend output for several weeks at its Silao, Mex., factory that also makes the Silverado, as well as the GMC Sierra.<\/p>\n

Jeff Gray, president of the Unifor local that represents 3,000 workers at GM\u2019s Oshawa plant, said the union is fighting the loss of the third shift, set to take effect in the first week of November. The plant restarted on Monday after a scheduled three-week shutdown for retooling but there is no new downtime planned, Mr. Gray said by phone. <\/p>\n

\u201cWe are in a wait and hold period right now to see if Mark Carney can get rid of the tariffs,\u201d Mr. Gray said. <\/p>\n

Beyond tariffs, GM\u2019s underlying business in the quarter was solid. Sales in the U.S. market \u2013 its main profit centre \u2013 rose 7 per cent, while the company continued to command strong pricing on its pickup trucks and SUVs. GM swung back to a small profit in China, after losing money there a year earlier.<\/p>\n

Automakers are increasingly shifting their focus to bolstering the core lineup of gas trucks and SUVs, as the growth rate of EV sales has slowed. Demand for battery-powered models already has slowed after rapid growth earlier this decade. The trend is intensified by the pending disappearance of government support for the battery-powered models.<\/p>\n

Sweeping tax and budget legislation approved by Congress will eliminate US$7,500 tax credits for buying or leasing new electric vehicles and a US$4,000 used-EV credit at the end of September.<\/p>\n

Mr. Trump also signed tax and budget legislation that eliminates fines for failures to meet fuel economy rules, a move that makes it easier to build more gas-powered vehicles.<\/p>\n

In Canada, automakers are fighting to get rid of a rule that requires 20 per cent of 2026 car sales be electric vehicles. EV sales have also slowed in Canada as government incentives expired. <\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: GM says it is sticking with previous statements that it will be able…\n","protected":false},"author":2,"featured_media":15842,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[901,888,902,879,877,903,45,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-15841","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-business","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/15841","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=15841"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/15841\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/15842"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=15841"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=15841"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=15841"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}