The automaker on Tuesday said General Motors abandoned previous forecasts for solid profit growth this year, as a result of the uncertainty created by President Trump's trade policy this year.
The Trump administration said this month it would impose a 25% tariff on imported cars and on Saturday it would impose a 25% duty on imported parts. About half of the cars GM sells in the US in a typical year are made overseas, mainly in Canada and Mexico.
Paul Jacobson, the company's chief financial officer, said during a conference call with reporters. “We don't want to give a number from the company, which is a guess in what the administration will do.”
He added that GM believes the impact of Trump's tariffs is “potentially material.” That is to say, it could have a major impact on the company's revenue this year.
GM also said it won $2.8 billion in the first quarter on Tuesday, down 7% from the previous year. The company generated almost all of its profits, with a 14% decline in profits before North American interest and taxes. That business, which serves the rest of the world, recorded small profits.
The company previously predicted its net profits would be $11.2 billion to $12.5 billion in 2025, earning about twice the net profits of last year's $6 billion.
“Previous guidance cannot be dependent on,” Jacobson said.
In addition to the 25% tariff on imported cars, the Trump administration has raised tariffs on imported steel and aluminum, increasing the costs of metals widely used in cars. Trump also significantly increased China's tariffs, imposing large tariffs on many other countries, which later fell to 10% for 90 days.
GM had a “productive debate” with the Trump administration over tariffs, Jacobson said, but he refused to elaborate. “I don't want to be seen as trying to negotiate publicly,” he said. “We look forward to making the tariff situation more clear in the automotive industry.”
The tariffs did not come into effect until April 3, and therefore had a minimal impact on the company's financial performance in the first quarter, Jacobson said. “We have a strong foundation for our business,” he said.
GM previously said it would increase production of pickup trucks at its factory near Fort Wayne, Indiana.
