General Motors’ profit fell by more than half in the third quarter, largely because of the declining value of its electric-vehicle operations, the automaker said on Tuesday. But investors were reassured by the company’s upgraded forecasts for adjusted measures of profit and cash flow, as well as a lower predicted bill for tariffs.
The company’s net income fell to $1.3 billion in the third quarter, from $3 billion last year. Revenue from July to September was roughly flat versus a year earlier, at $48.6 billion, the company said.
“With the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term E.V. adoption will be lower than planned,” G.M.’s chief executive, Mary T. Barra, said in a letter to shareholders. “That is why we are reassessing our E.V. capacity and manufacturing footprint.”
She added that the company expected to take additional accounting charges in the future.
The automaker said that tariffs imposed by the Trump administration cost the company just over $1 billion in the quarter, a similar amount to the previous quarter. But the company lowered the expected cost of tariffs this year to a range of $3.5 billion to $4.5 billion, from an expectation of $4 billion to $5 billion.
The company makes cars in Canada, Mexico and South Korea that it exports to the United States, and those vehicles have been subject to import duties that, at times, have been as high as 25 percent.
G.M. said it expected a full-year profit of $7.7 billion to $8.3 billion, which is at the lower end of its previously predicted range. It made $6 billion in 2024, when special charges related to its operations in China lowered its profit by $4 billion.
At the same time, the company raised its forecasts for adjusted measures of profit and cash flow this year, which strip out some costs and other actions. GM’s stock jumped more than 8 percent in early trading.
Electric-car sales jumped in the third quarter for many automakers as consumers rushed to buy new models before a $7,500 federal tax credit for those purchases ended on Sept. 30. Now sales of those cars, which have been slowing for most of the last two years, are expected to fall sharply. That has reduced the value of G.M.’s factories and other assets.
To reflect that decline, the company took a special accounting charge of $1.6 billion against its third-quarter earnings. A noncash portion, $1.2 billion, stemmed from the reduced value of plants and equipment, and a $400 million cash hit was related to the cancellation of supplier contracts.
In expectation of lower sales, G.M. has idled electric-vehicle factories in Michigan and Tennessee for several weeks in the final months of the year. It also sold its interest in a battery plant that it was building with LG Energy Solution.
G.M. is the second-largest seller of electric vehicles in the United States after Tesla. It has sold more than 144,000 of those models this year, more than double the total from the first nine months of 2024.
For years, G.M. had been betting on a steady and steep rise in sales of such cars, and at one point said it aimed to phase out internal combustion models by 2035, encouraged by the Biden administration’s climate and energy policies. But the Trump administration has reversed many Biden initiatives.
Tariffs and the electric-vehicle slowdown are likely to emerge as factors for other automakers. Tesla is scheduled to report its third-quarter results on Wednesday and Ford Motor on Thursday.
Neal E. Boudette is based in Michigan and has been covering the auto industry for two decades. He joined The New York Times in 2016 after more than 15 years at The Wall Street Journal.
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