GM Q2 Profit Drops 35% Amid $1.1B Tariff Hit, Impact Expected to Worsen

General Motors reported a 35% decline in second-quarter net income to $1.9 billion, largely due to a $1.1 billion hit from tariffs imposed by President Trump's administration on imported vehicles and parts. Despite strong sales growth, particularly in the U.S. market for gasoline trucks and SUVs, these tariffs have pressured GM's profitability and are expected to have an even greater impact in the third quarter. CEO Mary Barra highlighted ongoing efforts to mitigate tariff effects, including a $4 billion investment in U.S. assembly plants to increase production capacity, and maintaining pricing strategies to offset costs. GM anticipates total tariff costs of $4 billion to $5 billion in 2025 but aims to offset around 30% through manufacturing adjustments and cost initiatives. The company remains committed to a profitable electric vehicle future, noting Chevrolet's rise as the second-best selling EV brand in the U.S. While maintaining full-year profit guidance, GM acknowledges challenges ahead and is adapting to evolving trade policies and market conditions.