Berliner Boersenzeitung - GM reports quarterly loss but boosts shareholder returns

The results were dented by a previously-announced hit of $7.1 billion, mostly due to write-down on EV investments following an about-face in US environmental policy enacted by President Donald Trump's administration.

That resulted in a fourth-quarter loss of $3.3 billion, compared with a loss of $3.0 billion in the year-ago period.

Annual profits fell 55 percent to $2.7 billion.

But the big US automaker, which has undertaken significant strategic pivots in light of Trump's aggressive policy changes on trade and fuel economy rules, projected higher profits in 2026.

GM described its performance in 2025 as "resilient," with 2026 "positioned to be stronger than 2025," according to a company presentation.

GM expects solid vehicle pricing to continue amid relatively tight vehicle inventories that stand "slightly" below the company's target of having 50-60 days of supply on hand.

GM also plans launches of key vehicles, including its popular Chevrolet Silverado pickup.

"We grew the business and adapted to significant changes in tax and trade policy, to deliver full year (earnings) at the high end of guidance range," said Chief Executive Mary Barra

Revenues dipped 5.1 percent to $45.3 billion on lower vehicle sales compared with the year-ago period.

GM has significantly scaled back its EV investments while redirecting billions of dollars in capital towards boosting production of gasoline-fired vehicles.

However, Barra has said the company continues to believe in an EV future, in part because "we know once somebody drives an EV, they rarely go back to internal combustion engine," she said on Tuesday's analyst call.

- Lower auto inventories -

GM expects 2026 tariff costs of $3.0-$4.0 billion after incurring $3.1 billion in 2025, a bit below the $3.5 to $4.5 billion previously forecast.

The latest wildcard in White House trade policy came Monday night when Trump said he would raise tariffs on South Korean goods to 25 percent, accusing the Asian country's legislature of not enacting policy to cement a US-South Korea deal setting a 15 percent tariff.

GM has a significant operation in South Korea, including production of the Chevrolet Trax, a moderately-priced compact sport utility vehicle.

GM's forecasts still include the 15 percent levy. Barra said she was "hopeful" about the lower rate but would offset the hit if there is a period with a higher levy.

GM's North American inventories have gradually edged lower over the last year, standing at 486,000 vehicles at the end of the year, down 18.6 percent from the end of 2024.

Pricing will be "flat to up 0.5 percent," according to a GM slide.

The company does not anticipate a "big buildup" in vehicle supply, Chief Financial Officer Paul Jacobson said on the conference call.

Jacobson emphasized GM's ongoing commitment to shareholder returns, noting the company has repurchased $23 billion in stock since November 2023, reducing its outstanding share count by nearly 35 percent.

On Tuesday, GM raised its dividend by 20 percent and announced it had authorized $6 billion in new share repurchases.

Shares surged 8.6 percent shortly after midday.

(P.Werner--BBZ)