Pittsburgh, 23 July (Argus) — US automaker General Motors (GM) increased its vehicle sales in North America and Asia in the second quarter but took a $1.1bn tariff hit in the US.
GM contended with unpredictable and costly US tariffs in the second quarter as well as political headwinds in the electric vehicle (EV) sector, but the firm reiterated its commitment to growing its EV business in Tuesday’s earnings call with market analysts.
GM and the broader US auto industry had a spike in demand early in the second quarter because consumers raced to get ahead of price increases related to 25pc auto tariffs implemented by President Donald Trump.
That helped the Detroit, Michigan-based automaker raise its US sales to 747,000 vehicles in the second quarter, a 7pc increase from the same period a year earlier, according to GM’s results released Tuesday.
GM sales in China rose by 20pc to 448,000 automobiles compared to the second quarter last year. Overall, GM sold about 1.5mn vehicles in the second quarter, a 7pc uptick from a year earlier.
Trump began ramping up his tariffs in the second quarter. In addition to blanket tariffs on most trading partners, Trump has imposed import taxes on vehicles, auto parts, steel and aluminum. That raised costs for GM significantly.
The tariffs had a net negative impact of $1.1bn on GM in the second quarter. The automaker expects that figure to rise in the third quarter and reach a total of $4-5bn in tariff costs for the year.
Last month, GM announced a $4bn plan to increase gas-powered and EV output at its US operations to 2mn /yr, up from /yr currently.
Trump also signed into law the repeal of the EV tax credit earlier this month. GM said it remained focused on growing its EV sales and profitability in spite of the removal of the tax credit.
“Despite slower EV industry growth, we believe the long-term future is profitable electric vehicle production, and this continues to be our north star,” GM chief executive Mary Barra said Tuesday.
She noted that its Ultium Cells joint venture with South Korean firm LG Energy Solution will start making lithium iron phosphate batteries in Spring Hill, Tennessee, in 2027.
GM’s earnings from that joint venture totaled $11mn in the second quarter, down from $324mn in the same period a year earlier.
GM made a profit of $1.9bn in the second quarter, a 35pc decrease from the second quarter of 2024.
By James Marshall
