Quick Overview

  • General Motors Chief Financial Officer Paul Jacobson said Wednesday during a panel discussion at the BofA 2026 Global Auto Summit that the slowdown in electric vehicle growth next year provides the company with an "opportunity to deeply cut costs across the system."
  • The Detroit-based automaker is one of many car companies that adjusted their EV strategies last year due to slowing consumer demand and spending. According to its full-year 2025 results released in January, the company hascut EV productionand begun adjusting its EV capacity and manufacturing footprint. GM recorded a $6 billion EV-related charge in the fourth quarter of last year.
  • Jacobson, in atranscript of the panel discussion, said: "As we know, in 2026 we will face significant dedicated cash headwinds." He was referring to the EV restructuring plan and related costs, "and we are actively working to put that behind us. My goal is to have all related work completed by the end of the second quarter."

Deep Insights

In recent years, U.S. EV spending has continued to decline due to inflationary pressures, tariff and tax policy changes, and intensifying industry competition. Cox Automotive data shows that new car sales in February fell 26.8% year-over-year. The report noted that GM's Chevrolet was a "standout performer" that month, with sales growing more than 70%.

Over the past two years, GM has gradually scaled back EV manufacturing and production: for example, in December 2024, the company sold its stake in an EV battery plantto LG Energy Solution, as CNBC reported at the time. Last year, the company cut prices on its Chevrolet BrightDrop electric vans and, according to its fourth-quarter and full-year results released on January 27, tookimpairment charges。

on some EV assets. GM reported an $1.8 billion non-cash impairment in the fourth quarter of 2025 related to the discontinued vans and impairments, as well as $4.2 billion in cash expenditures from contract cancellations and supplier settlements. The company expects to continue incurring EV-related costs this year that are "significantly reduced" but still material.

Jacobson said during Wednesday's keynote that the company is making "good progress" in continuing to negotiate such claims. The speech focused on GM's strategy around the growth of its OnStar subscription platform, whichincludes new technology and computing platforms, as well as "software-defined vehicle architecture" EVs planned for launch in 2028.

In a Q&A session with Alexander Perry, head of North American auto equity research at BofA, Jacobson also mentioned the ongoing impact of tariffs and other macroeconomic trends on the company.

Jacobson said: "I think before talking about 2026, we have to take a moment to look back at 2025—now in hindsight, that was almost a year of setting the stage for this year." He noted that there was "a lot of anxiety" in the market about tariffs, but it later became clear that the auto industry is "very, very important" to the government.

He said: "So even when tariffs were implemented, they wanted to make sure to maintain competitiveness, and I think they found a good narrow path. Would we rather not pay $3 billion in tariffs? Possibly. But at the end of the day, we see that we can adapt to this and overcome it, treating it as a small speed bump before getting back on track."

According to the results report released on January 27, GM paid $3.1 billion in tariffs in full-year 2025. However, the report noted that "solid financial performance"helped offset more than 40% of that figure, including adjusted automotive free cash flow of $10.6 billion and adjusted EBITDA of $12.7 billion.

According to an analysis by Automotive News, tariffs have cumulatively cost automakers about $35.4 billion since 2025. The analysis tracked financial reports through mid-March and was published Monday. It reportedly stated that Toyotawill pay the highest tariff bill, with related costs of approximately $9.1 billion for its fiscal year 2026.