G.M. Withdraws Profit Forecast as Trump Tariffs Take a Toll
General Motors is abandoning a previous forecast for solid profit growth this year as a result of the uncertainty created by President Trump’s trade policies, the automaker said on Tuesday.
The Trump administration imposed a 25 percent tariffs on imported cars this month and has said it will impose a 25 percent duty on imported parts on Saturday. About half the cars that G.M. sells in the United States in a typical year are made abroad, mostly in Canada and Mexico.
“We are not going to give any more forward guidance on tariffs until we have more clarity,” the company’s chief financial officer, Paul Jacobson, said in a conference call with reporters. “We don’t want to put out a number from the company that is a guess amidst what the administration might do.”
He added that G.M. believed the impact of Mr. Trump’s tariffs “could be material,” meaning they could have a substantial effect on the company’s earnings this year.
G.M. also said on Tuesday that it made $2.8 billion in the first quarter, a decline of 7 percent from a year earlier. The company was hurt by a 14 percent drop in earnings before interest and taxes in North America, where it generates almost all of its profit. Its businesses that serve the rest of the world recorded small profits.
The company previously said it expected to make between $11.2 billion and $12.5 billion in net income for 2025, roughly double the $6 billion it made last year.
“The prior guidance cannot be relied upon,” Mr. Jacobson said.
In addition to the 25 percent tariffs on imported cars, the Trump administration has raised tariffs on imported steel and aluminum, driving up the costs of metals widely used in cars. Mr. Trump has also substantially raised tariffs on China and imposed hefty tariffs on many other countries that he later reduced to 10 percent for 90 days.
G.M. has had “productive discussions” with the Trump administration on tariffs, Mr. Jacobson said, but he declined to elaborate. “I don’t want to be viewed as trying to negotiate in public,” he said. “We look forward to getting more clarity around the tariff situation for the auto industry.”
The tariffs had a minimal impact on the company’s financial performance in the first quarter because they didn’t go into effect until April 3, Mr. Jacobson said. “The fundamentals of our business are strong,” he said.
G.M. previously said it would increase pickup truck production at a plant near Fort Wayne, Ind., a move that would allow it to reduce truck imports somewhat from Canada and Mexico.