General Motors Company

Financial Performance and Guidance Adjustment: GM reported $44 billion in total revenue for Q1 2025, a 2% increase year-over-year. Adjusted EBIT was $3.5 billion, with a margin of 7.9%, and diluted EPS of $2.78. However, the company adjusted its full-year EBIT guidance down to $10 billion - $12.5 billion, influenced largely by an expected $4 billion to $5 billion impact from new tariffs, which is net of self-help initiatives that aim to mitigate 30% of these costs.

Tariff Impact and Mitigation Strategy: The import tariffs impose a significant challenge, particularly with a 25% tariff on vehicle imports now in effect. GM has begun implementing strategies to counter this impact by increasing local production and content compliance (over 80% USMCA compliance) to insulate itself from tariffs. These strategies include volume increases at key plants and a focus on relationships with suppliers to enhance US production.

Disciplined Cost Management: GM is actively examining discretionary spending, aligning it with strong consumer demand while managing rising fixed costs, particularly in warranty expenses related to vehicle quality issues. The company aims to maintain cost discipline amidst inflationary pressures and is optimistic that cost reductions can offset some tariff impacts without detrimental cuts linked to demand.