President Donald Trump’s 25% tariffs on imported vehicles and parts have sent shockwaves through the U.S. auto industry.
General Motors (GM) reported a $1.1 billion second-quarter earnings hit, projecting $4 billion to $5 billion in annual losses. Stellantis (STLA), maker of Jeep and Ram, posted a €2.3 billion ($2.68 billion) first-half loss, with €300 million tied to tariffs. Ford (F), which is set to report earnings on July 30, anticipates a $1.5 billion profit reduction but may be less impacted due to its higher U.S. production.
The industry’s sales run rate is 15.5 million vehicles annually, down 500,000 units from pre-tariff projections, as consumers rushed out to buy cars before potential price hikes. While tariffs threaten automaker profitability, most are absorbing costs to avoid passing them to consumers, raising questions about long-term sustainability. Ford’s domestic manufacturing edge, however, may offer some resilience in this turbulent market.
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