General Motors (GM) is poised to release its fourth-quarter earnings on January 27, 2026, as the company grapples with the financial impact of recent shifts in the automotive market. In a year marked by significant challenges, including a 25% tariff on automotive imports imposed by the U.S. government, GM navigated a complex landscape that affected both production and sales.
The company’s forecast for 2025 indicates anticipated new vehicle sales of approximately 2.83 million, representing a 5.1% increase year over year and a market share of 17.3%. GM’s primary competitors are also expected to perform well, with Toyota projecting 2.52 million vehicles sold (+8.4% YoY) and Ford aiming for 2.18 million vehicles (+5.6% YoY), according to data from Cox Automotive.
Despite reclaiming the title of the top U.S. automaker in 2025, selling more vehicles than any other manufacturer, GM faces hurdles in its electric vehicle (EV) segment. Recently, the company revealed that scaling back its EV ambitions would incur substantial costs, amounting to a $6 billion charge in the fourth quarter. This figure includes $1.8 billion in non-cash charges related to supplier settlements and contract cancellations, along with $4.2 billion in cash charges linked to production adjustments in response to declining demand.
Analysts Optimistic About Future Performance
Analysts at BNP Paribas expressed optimism regarding GM’s future, suggesting that the company will perform well in 2026 due to its consistent execution and improved market share. The analysts noted, “We see continued outperformance levers in 2026… unlocking stronger shareholder returns.” Following this analysis, BNP Paribas raised GM’s price target from $83 to $95 per share.
Investors may find some solace in GM’s current inventory levels, which are considered “favorably low,” as well as anticipated reductions in tariffs from Korea. Nonetheless, the recent financial disclosures highlight the serious implications of GM’s shift in strategy regarding electric vehicles.
The EV market experienced a surge of interest earlier in 2025, particularly before the expiration of a $7,500 tax credit for EV buyers at the end of September. Despite the initial excitement, sales data indicated that while numerous EV models were available, only a few achieved significant sales figures. The Tesla Model Y and Model 3 emerged as the best sellers, with over 114,000 and 53,000 units sold, respectively. In contrast, GM’s Chevy Equinox sold just under 25,000 units.
Strategic Adjustments in Response to Market Demand
As GM prepares for its earnings report, CEO Mary Barra has acknowledged the need for strategic adjustments. In an October 2025 filing, GM stated, “Near-term EV adoption will be much lower than planned,” citing changing government policies and the expiration of certain consumer incentives as contributing factors. The company’s board approved a $1.6 billion charge for a planned strategic realignment of its EV capacity and manufacturing footprint, aiming to align with consumer demand.
Barra emphasized the need for swift action to address overcapacity issues, stating, “By acting swiftly and decisively… we expect to reduce EV losses in 2026 and beyond.” This recalibration reflects GM’s commitment to adapting to an evolving market, as the company seeks to balance its ambitious EV goals with practical market realities.
As GM prepares for the upcoming earnings release, the automotive giant remains at a crossroads, striving to maintain its market position while navigating the complexities of the EV landscape. The results will not only reflect GM’s performance but also shed light on the broader implications for the automotive industry in a year defined by change.
