GM lifts profit outlook as US truck sales boost first quarter

[DETROIT] General Motors posted on Tuesday (Apr 28) a 22 per cent rise in first-quarter core profit and lifted its full-year earnings forecast, bolstered by a resilient US car market and an expected tariff refund.

The Detroit automaker reported earnings before interest and taxes of US$4.3 billion, or US$3.70 per share, which beat analysts’ estimate of US$2.62, according to LSEG data. Shares rose about 5 per cent in premarket trading.

GM raised its 2026 profit outlook by US$500 million, which is the same amount it expects to get back in refunds stemming from a US Supreme Court ruling that struck down some of the Trump administration’s tariffs. It now expects full-year core profit to be US$13.5 billion to US$15.5 billion.

The higher projection comes despite a surge in commodity costs. GM now expects inflation in raw materials, computer chips and logistics to cut earnings by US$1.5 billion to US$2 billion this year, about US$500 million more than it estimated late last year.

The automaker’s quarterly net income dropped 6 per cent from a year earlier to US$2.6 billion, mostly due to a US$1.1 billion charge to settle supplier claims for slowing electric-vehicle programmes. Revenue of US$43.6 billion was down less than 1 per cent.

American consumers have continued buying cars despite a year of economic uncertainty from tariffs, elevated gas prices and a shaky job market. “We are clearly operating in a very dynamic environment, which isn’t unusual for this industry,” GM CEO Mary Barra said in a statement.

In North America, GM’s biggest money maker, its profit margin improved to 10.1 per cent from 8.8 per cent a year earlier, despite lower vehicle shipments to dealers and a 10 per cent decline in sales in the first quarter.

The sales drop was partly explained by a tough comparison to first-quarter 2025, when US buyers snapped up new vehicles in a rush to beat tariff-related price hikes.

The company’s pickup-truck sales remained strong despite US gas prices surging to above US$4 per gallon in March due to fallout from the war in Iran. GM finance chief Paul Jacobson told CNBC that customer traffic at US dealerships remained steady in March and April.

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GM said cost savings from eased tailpipe emissions regulations in the US, as well as lower warranty expenses, helped offset the decline in sales. Stronger pricing helped too: GM said the average price paid for its vehicles in the US was US$52,000 in the quarter, up about 3 per cent from a year earlier.

In China, where GM is restructuring the business, the automaker reported equity income of US$165 million, versus US$45 million a year ago.

Its international business excluding China saw core profit of US$123 million, up from US$30 million.

Like many other automakers, GM has pulled back on production of EVs because of weaker demand following pro-fossil-fuel policies enacted by the Trump administration last year. GM’s EV sales fell 43 per cent in the final three months of last year.

In addition to the US$1.1 billion first-quarter charge, GM last year recorded US$7.6 billion in writedowns on its EV programmes. REUTERS