GM & Stellantis Hit by Trump Tariffs, Q2 Profit Tumbles
GM & Stellantis hit by Trump tariffs: Q2 profit plunges and H1 losses mount amid $1.1 B and €300 M tariff hit. What does this mean now?
Why this matters now: Trade policy disruptions are squeezing U.S. manufacturing and investor confidence.
General Motors and Stellantis, two pillars of the U.S. automotive industry, are grappling with escalating costs and shrinking profits as recent Trump-era tariffs take effect. GM saw a dramatic Q2 earnings slump, while Stellantis posted a first-half loss, both grappling with billions of dollars in charges tied to the new 25% duties.
Why does this car matter right now?
GM’s Q2 2025 net income dropped roughly 35 % to $1.9 billion, with a direct $1.1 billion hit from tariffs on imported parts and vehicles. Despite topping revenue estimates at $47.1 billion, the company reaffirmed its modified full‑year forecast, a sign of confidence amid pressure. Meanwhile, Stellantis reported a €2.3 billion ($2.7 billion) net loss for H1, attributing around €300 million solely to U.S. tariff exposure.
How does it compare to rivals?
Automotive peers like Ford and other import-heavy brands face similar strain, but GM and Stellantis are unique in absorbing both production and import duties. A recent industry study pegged cumulative tariff costs for U.S. automakers at nearly $4–5 billion this year, roughly $5,000 per vehicle in parts. Stellantis saw North American shipments fall 25 % in Q2, while GM plans to shift 300,000 units of production back to U.S. plants by 2027 to offset cost.
Who is this for, and who should skip it?
This matters to investors, auto-industry watchers, and policymakers tracking U.S. manufacturing resilience. Consumers, too, should pay attention; portfolio shifts may lead to price adjustments later this year. However, fans of smaller, independent brands or luxury imports, which are better supported by robust supply chains, may find this less relevant for now.
What’s the long-term significance?
Both automakers are implementing mitigation strategies: GM has pledged a $4 billion investment in U.S. assembly lines and shifts like moving Blazer SUVs from Mexico to Tennessee. Stellantis is closing noncore plants, cancelling hydrogen projects, and aligning with stricter U.S. fuel economy standards, all moves aimed at resilience. Still, analysts warn tariff costs may double in H2, meaning even these efforts may only offset a fraction.
The ongoing 25% import tariff remains a high-stakes game changer, impacting U.S. jobs, balance sheets, and the industry’s pivot to electric vehicles. Mix in evolving trade deals and the looming threat of further tariffs, and the landscape appears more volatile than ever.
