General Motors takes charges of $1.6B on strategic realignment of EV capacity

In a regulatory filing, General Motors (GM) stated that the company made significant investments and contractual commitments in the development of electric vehicles to help the company’s vehicle fleet comply with emissions and fuel economy regulations that were scheduled to become increasingly stringent. “Following recent U.S. Government policy changes, including the termination of certain consumer tax incentives for EV purchases and the reduction in the stringency of emissions regulations, we expect the adoption rate of EVs to slow. These developments have caused us to reassess our EV capacity and manufacturing footprint. On October 7, 2025, the Audit Committee of the Company’s Board of Directors approved charges of $1.6 billion in GM North America in the three months ended September 30, 2025, based on a planned strategic realignment of our EV capacity and manufacturing footprint to consumer demand. These charges include non-cash impairment and other charges of $1.2 billion as a result of adjustments to our EV capacity. In addition, the Company has incurred charges of $0.4 billion, primarily related to contract cancellation fees and commercial settlements associated with EV-related investments, which will have a cash impact. The reassessment of our EV capacity and manufacturing footprint, including our investments in our battery component manufacturing, is ongoing, and it is reasonably possible that we will recognize additional future material cash and non-cash charges that may adversely affect our results of operations and cash flows in the period in which they are recognized. These amounts, and certain other insignificant charges expected to be recognized in this quarter, will be reflected as adjustments in our non-GAAP financial measures.”