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GM Books $1.6 Billion Charge as EV Policy Reversal Recasts U.S. Demand

GM links the hit to the tax credit’s expiration, which pulled sales into Q3 then left automakers bracing for weaker demand.

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FILE - An electric vehicle is plugged into a charger in Los Angeles, Aug. 25, 2022. Since passage of the Inflation Reduction Act, it has boosted the U.S. transition to renewable energy, accelerated green domestic manufacturing, and made it more affordable for consumers to make climate-friendly purchases. (AP Photo/Jae C. Hong, File)
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Overview

  • GM said the charge includes about $1.2 billion in non-cash impairments tied to EV capacity adjustments and $400 million for contract cancellations and commercial settlements.
  • The company is reassessing EV capacity, battery investments, and its manufacturing footprint, and it stated that additional charges are reasonably possible in future quarters.
  • U.S. EV sales reached a Q3 record with roughly a 10.5% market share as buyers rushed to use the $7,500 federal incentive before it expired, pointing to a likely pullback in the months ahead.
  • GM reported record EV deliveries but is slowing planned output growth, with adjustments cited for facilities in Spring Hill, Tennessee, and Hamtramck, Michigan.
  • After dropping dealer lease workarounds for the expired federal credit, GM is offering about $6,000 in temporary lease support, while peers such as Ford have already recorded sizable EV-related charges.