General Motors said on Thursday it will take roughly $6 billion in charges related to cuts to its electric-vehicle program, on top of a $1.6 billion charge announced in October after changes in US policy reduced expected EV demand. The charges include non-cash write-downs and payments to suppliers, reflecting lower production capacity and scaled-back factory plans following the rollback of federal incentives under the Donald Trump administration. GM shares fell 2 per cent in after-hours trading.
Write-Down Breakdown
The bulk of the charges comes from payments to suppliers for projects that have been cancelled as General Motors pulls back on its electric-vehicle plans. Of the total, $1.8 billion reflects non-cash write-downs, while $4.2 billion will be paid out in cash to suppliers. The company is retooling its Orion, Michigan, plant to build full-size SUVs and pickup trucks instead of EVs, and has sold its stake in the Ultium Cells battery plant in Lansing to partner LG Energy Solution, cutting planned battery output. In the fourth quarter alone, total charges climbed to $7.1 billion, including $1.1 billion tied to restructuring and legal costs in China. GM said further charges are likely in 2026, though they should be smaller. The shift will also lead to job losses, with about 1,200 roles cut at Factory Zero in Detroit and another 550 layoffs at its Ohio battery facility.
Policy Shift Crushes EV Demand
A shift in US policy has weighed on electric-vehicle demand. After returning to office, Donald Trump rolled back emissions rules introduced under Joe Biden, cut EV tax credits, and challenged state efforts to phase out petrol-powered cars. The changes contributed to a drop in EV demand across North America in 2025. General Motors, which had spent heavily in pursuit of an emissions-free lineup by 2035, is now reworking its strategy. Chief executive Mary Barra said the company is responding to what customers are willing to buy. While plans are being adjusted, GM said no models have been scrapped or factories closed, and electric vehicles under its Chevrolet, GMC and Cadillac brands will continue to be sold.
Industry‑Wide EV Reckoning
The pullback from electric vehicles is not limited to General Motors. Ford disclosed in December that it would take a $19.5 billion write-down after reworking its EV plans, underscoring how much of the industry expanded too fast while betting on government mandates and subsidies. Although electric-car sales continue to rise globally, momentum has slowed in the United States. GM says it is sticking with its long-term EV ambitions, even as recent charges reduce the value of some assets and reflect restructuring costs. The hit to cash flow will largely come from payments to suppliers. Both automakers are set to report fourth-quarter earnings next week.
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