GM Leaders Expect EV Losses to Shrink By $1B+ This Year

General Motors Corp.’s adjusted profit margins in North America should climb back to between 8% and 10% this year thanks in part to a “resilient” automotive market, Chair and CEO Mary Barra told investors Jan. 27.

GM last year produced a 6.8% earnings before interest and taxes adjusted margin in North America, down from 9.2% in 2024, as tariff costs and billions of dollars of charges related to its investments in electric-vehicle capacity ate into profits. But Barra and CFO Paul Jacobson see the headwinds from both of those factors easing in 2026 and expect GM’s wholesale volumes to be flat to up slightly while prices also rise slightly. That, they said, will set the stage for GM globally to produce between $13 billion and $15 billion in adjusted EBIT versus $12.7 billion in 2025.

On EVs, GM’s leaders think losses will shrink by $1 billion to $1.5 billion this year from 2025 levels as production shrinks and capacity is repurposed for internal-combustion projects. They also expect to see related benefits of $500 million to $750 million from looser regulations, primarily the end of a requirement to buy emissions compliance credits.

“We are operating in a U.S. regulatory and policy environment that is increasingly aligned with customer demand,” Barra wrote in a letter to shareholders. “As a result, we continue to onshore more production to meet strong customer demand for our vehicles. Over the next few years, our annual production in the U.S. is expected to rise to an industry-leading 2 million units.”

The investments in getting to that 2 million target—which includes the recently announced move of Buick Envision production to Kansas from China and will include expansions in Michigan and Tennessee, among other places—will total $5 billion between now and the end of 2027, Jacobson told analysts on a conference call. That spending will be part of a capex plan of between $10 billion and $12 billion in each of the next two years, up from $9.2 billion in 2025.

In the fourth quarter, GM booked a $3.3 billion net loss on sales of $45.3 billion, the result of $6 billion in EV-related charges as well as $700 million in restructuring costs booked at the company’s China joint venture. Adjusting for those and other one-time matters, EBIT ticked up to $2.8 billion from $2.5 billion in the last three months of 2024. The company’s board voted to lift its quarterly dividend by 20% and to launch a $6 billion stock buyback plan, moves Barra said showed directors’ confidence that GM’s “formula is sustainable.”

Shares of GM (Ticker: GM) jumped on the earnings report and associated news. In late-morning trading, they were up more than 9% to nearly $87. They have now risen more than 60% over the past six months, a surge that has lifted the company’s market capitalization to nearly $83 billion.