General Motors is facing a significant earnings loss of $7 billion after pulling back from its electric vehicle investments, primarily due to changes in US policies that have altered consumer demand for EVs.
The automaker's fourth-quarter financial results will be affected by $6 billion in charges related to reversing its earlier investments in electric vehicles. This move follows a similar write-down of $1.6 billion in the third quarter, which was also caused by a shift away from EVs following a policy reversal under former President Donald Trump.
Trump's administration has been hostile to climate change initiatives, including those favoring electric vehicles championed by his predecessor Joe Biden. As a result, automakers are reassessing their investments in the sector.
General Motors' CEO Mary Barra had aggressively invested in building EV capacity during Biden's presidency, with the company aiming to make all its cars and trucks emissions-free by 2035. However, Barra has now acknowledged that consumer demand for EVs is slowing down in North America due to changes in tax incentives and emissions regulations.
In a statement, GM cited "the termination of certain consumer tax incentives and the reduction in the stringency of emissions regulations" as reasons for reducing its electric vehicle capacity. The company's decision comes ahead of Ford's announcement that it will write off $19.5 billion over several years due to similar changes in policy.
Besides the EV-related losses, GM is also facing a $1.1 billion hit from restructuring costs related to its China joint venture and an additional legal accrual.
The automaker's fourth-quarter financial results will be affected by $6 billion in charges related to reversing its earlier investments in electric vehicles. This move follows a similar write-down of $1.6 billion in the third quarter, which was also caused by a shift away from EVs following a policy reversal under former President Donald Trump.
Trump's administration has been hostile to climate change initiatives, including those favoring electric vehicles championed by his predecessor Joe Biden. As a result, automakers are reassessing their investments in the sector.
General Motors' CEO Mary Barra had aggressively invested in building EV capacity during Biden's presidency, with the company aiming to make all its cars and trucks emissions-free by 2035. However, Barra has now acknowledged that consumer demand for EVs is slowing down in North America due to changes in tax incentives and emissions regulations.
In a statement, GM cited "the termination of certain consumer tax incentives and the reduction in the stringency of emissions regulations" as reasons for reducing its electric vehicle capacity. The company's decision comes ahead of Ford's announcement that it will write off $19.5 billion over several years due to similar changes in policy.
Besides the EV-related losses, GM is also facing a $1.1 billion hit from restructuring costs related to its China joint venture and an additional legal accrual.
. I mean, we all knew it was a big risk, but $7 billion is like, wow. I think they were caught up in the hype and didn't realize how quickly policy changes could impact demand 
. It's not like they're alone either, Ford just announced something similar... and GM was like "oh no, we're the first to get hit" 
. Anyway, it'll be interesting to see what happens next, maybe they'll regroup and find a new strategy 
.
just when they were getting all hyped up about goin green lol now its like the whole market is just waiting for some gov policy shift before they start investin again 
meanwhile, china will still be rakin in the cash from their joint venture 
and ford has a $19.5 BILLION write off 
anyway, gm shoulda seen it comin', they were talkin so much trash about trump's climate policies now they're payin the price 
. 7 billion in losses is crazy talk though... that's like losing all your savings on a bad lottery ticket 
. Ford's getting hit too with a 19.5 billion write-off, talk about an EV-idence of how policies can tank your bottom line 
anyway so like i was reading this news about gm and their electric vehicle plans and it seems like they got totally blindsided by the policy changes 
I'm kinda surprised by this news... I mean, electric vehicles are supposed to be the future of transportation, right? 
It's like, how can we not want cleaner air and less pollution? But at the same time, I get why General Motors is feeling the pinch... policy changes can be really unpredictable. 
I guess we just need to adapt and find new ways to make sustainable transportation work... maybe with more incentives or something? 
That's just a nice way of saying people don't wanna pay more for their cars. And it's not like the gov didn't give them plenty of incentives to get into the game... I mean, who wouldn't wanna invest in something that's supposed to save the planet? 
It's just so frustrating when companies make these big decisions based on short-term profits instead of looking at the bigger picture. And now they're gonna have to pay for it with $7 billion in losses and whatnot... 
but is it really just because of some changes in tax incentives and emissions regulations? That sounds kinda lame 
. I thought EVs were supposed to be all the rage now! 
Did they not think this through or something? 
And it's not just GM, Ford is doing the same thing 
. I mean, I get it, policies change and all that, but to write off billions of dollars? That's just crazy talk 
. Now it seems like all that progress is just being reversed 
. I mean, come on, 2035 to be emissions-free? That's not even that far off! And now GM's pulling back on its investments... it's gonna cost 'em big time 
. And this doesn't even mention the poor people who can't afford the new, "revised" emissions regulations 
. It's like the system is just looking out for itself, not the consumers 
it's so funny! anyway back to gm... like what's up with the tax incentives? can't they just make cars more affordable or something? and now they're rethinking evs because of climate change... isn't that kinda backwards? we should be all about sustainability, right? I mean i know politics are complicated but come on, GM is a huge company... they could do so much good. did u know that some countries have already banned gas-powered cars? it's crazy!
.
i mean i get it gm made a bet on evs but didnt anticipate trump's climate change U-turn 
, but consumer demand is actually slowing down now. I get it, I really do, but still... $7 billion losses? That's a big chunk of change 
.