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GM boosts 2026 outlook on premium pricing for big trucks
Carmaker's brighter outlook came despite a tough second quarter
A 2026 Chevrolet Colorado Trail Boss truck. (Graham Hughes/Bloomberg)
Key Takeaways:
- General Motors raised its 2026 adjusted EBIT outlook by $500 million to $14 billion-$16 billion after second-quarter earnings and revenue topped estimates.
- Higher margins on large vehicles and lower tariff costs helped offset weaker U.S. sales, while GM recorded another $2.3 billion in EV-related charges.
- GM lowered all-electric vehicle production, bringing total EV write-downs to $11 billion, and repurchased $2 billion of shares during the quarter.
General Motors Co. raised its full-year profit forecast by another $500 million after beating second-quarter earnings estimates, powered by stronger margins on its largest vehicles and lower tariff costs.
The Detroit automaker said July 21 it now expects its earnings before interest and taxes of as much as $16 billion this year. The upgraded projections came after GM said it made $3.57 a share, exceeded Wall Street analysts’ consensus forecast of $3.19, after buying back more shares.
GM’s brighter outlook came despite a tough second quarter in which its U.S. sales fell, including the large pickup trucks and SUVs that make most of its earnings. The company has kept profits up by keeping inventory low and maintaining higher prices on its most profitable models. CEO Mary Barra said she sees that positive momentum continuing into next year.
“We expect these trends will continue to strengthen our performance into 2027 and beyond because we have multiple engines of margin expansion and growth while maintaining our capital discipline,” Barra said in a said in her quarterly letter to shareholders.
Adjusted earnings before interest and taxes this year will range from $14 billion to $16 billion, above a 2026 forecast of $13.5 billion to $15.5 billion it made in April and the $13 billion to $15 billion it saw in January.
GM lowered its expected net income by at least $1.5 billion to a range of $9.9 billion to $11.4 billion, due to electric vehicle-related charges. The company added another $2.3 billion in those charges as it lowers production of all-electric models. That brings GM’s total EV write-downs to $11 billion as it pulls back on its once aggressive electrification strategy.
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The carmaker said it made about $1.3 billion in net income in the second quarter, down from $1.9 billion last year, due partly to those charges.
Shares of GM rose 1.3% in premarket trading to $76.75 as of 7:15 a.m. in New York. The stock closed July 20 down 6.8% this year.
Revenue in the three-month period came to $48.03 billion, compared with analysts’ estimates for $46.61 billion. That came after it posted a 4.2% drop in sales last quarter on weaker demand for its best-selling trucks and Equinox crossover SUV. For the first six months, GM’s’ deliveries fell 6.8%.
The company’s China business equity income rose $83 million, up from $71 million a year ago but below $165 million in the first quarter.
It also said it bought back $2 billion in shares in the quarter ended June 30.
