General Motors is the latest U.S. auto giant to say tariffs have taken a chunk from their earnings. The company beat earnings expectations on Tuesday, but reported a decline in second-quarter profits, including a $1.1 billion hit as a result of hefty import taxes.
GM reported a 2% dip in sales to $47 billion, as well as $1.9 billion in quarterly profits, compared to $2.9 billion in the same period last year.
Anticipating the impact of President Donald Trump’s auto tariff policy—which outlined a 25% levy for many imported vehicles—GM withdrew its annual guidance last quarter, predicting an up to $5 billion pummelling from the levies. The company announced last month plans to invest $4 billion in domestic manufacturing plants in order to offset the cost of imports, as well as increase production capacity. Still, GM’s reliance on compact cars made in South Korea has made it vulnerable to the levies.
“In addition to our strong underlying operating performance, we are positioning the business for a profitable, long-term future as we adapt to new trade and tax policies, and a rapidly evolving tech landscape,” CEO Mary Barra wrote in a letter to shareholders on Tuesday.
GM’s rival Stellantis, which owns Jeep and Ram Trucks among other brands, announced on Monday $2.7 billion in net losses for the first half of the year as North American sales continued to slump. Those struggles were exacerbated by the “early effects of U.S. tariffs,” according to Stellantis, which had a more than $350 million negative impact on the company.
