It really seems appropriate to say that General Motors, having left the electric car increasingly smaller in the rearview mirror, has seen its accounts surge above expectations.
HOW 2026 STARTS FOR GENERAL MOTORS
The Detroit automaker closed the first quarter of 2026 with revenues of $43.6 billion (-1% year on year) and adjusted operating profit (adjusted EBIT) of $4.3 billion (+22%), well above analysts’ estimates of $2.62 per share according to LSEG.
As expected, extraordinary charges of $1.1 billion due to settlement agreements with suppliers following the “U”-turn in electric vehicle production programs still weigh on net profit, which recorded a 6% decline, standing at $2.6 billion.
The reversal was decided not only because of the bubble in the segment but also to meet the new needs of the US market as redesigned by Donald Trump, who favors old internal combustion engines and is hardly supportive of battery power.
REMOVED THE BURDEN OF TRUMP TARIFFS?
Donald Trump himself has allowed, albeit against his will, optimism about GM’s future since the Detroit automaker is revising upward by $500 million its adjusted EBIT forecast for the entire year, bringing it to a range between $13.5 and $15.5 billion, no longer having to consider the tariffs which, as is known, were overturned by the Supreme Court ruling in February. For this reason, the estimated gross cost of customs duties for 2026 now falls to $2.5-3.5 billion from the previous $3.0-4.0 billion. Adjusted diluted EPS between $11.50 and $13.50.
Trump’s tariffs also help explain the apparent stall in sales recorded by the American automaker in the domestic market, the group’s main market: the decline is double-digit (-10%) because last year there was a baby boom among US consumers who anticipated purchases to avoid price increases related to customs tariffs. It is also noted that the operating margin improved to 10.1% from 8.8% a year ago. Finally, in China, where GM is restructuring, equity income rose to $165 million from $45 million.
