Fourth-quarter writedowns tied to EV strategy reset
General Motors said Thursday it will record $7.1 billion in special charges for the fourth quarter of last year, reflecting a pullback in its electric vehicle strategy and restructuring actions in China.
In a regulatory filing, the Detroit automaker said roughly $6 billion of the charges relate to changes in its EV plans amid weakening demand. An additional $1.1 billion, including about $500 million in cash costs, is linked mainly to a previously announced overhaul of a joint venture in China.
The charges will reduce reported net income but will be excluded from adjusted financial results. The move follows GM’s October announcement that it was reassessing its EV roadmap, which resulted in an initial $1.6 billion charge in the third quarter.
Comparison with peers and cost structure focus
The writedowns come shortly after Ford Motor said in December it expects to take around $19.5 billion in special charges tied to a restructuring of business priorities and a retreat from some all-electric vehicle investments.
GM Chief Financial Officer Paul Jacobson said previously that while the company continues to see a long-term future for electric vehicles, structural changes are needed to lower production costs and improve competitiveness.
Automakers typically exclude one-time or special items from adjusted earnings to provide investors with a clearer view of ongoing operations.
Cash and non-cash impacts detailed
GM said the fourth-quarter EV impairments include approximately $1.8 billion in non-cash charges. The remaining $4.2 billion relates to supplier settlements, contract cancellation fees and other items that will result in cash outflows when paid.
The company expects additional EV-related charges in 2026, tied to continued negotiations with suppliers, though it said these are likely to be significantly lower than the impairments recorded in 2025.
Regulatory and market pressures
GM also warned it could face further charges related to emissions credits, depending on proposed changes to greenhouse gas standards under the Trump administration.
The automaker was among the earliest to commit heavily to EVs, at one point planning to invest $30 billion across new models and battery capacity. However, U.S. EV sales have slowed after the federal government ended a $7,500 tax credit for buyers earlier than expected in September.
Market reaction and outlook
Shares of GM closed Thursday at $85.13, up nearly 4% on the day. The stock gained more than 50% in 2025, outperforming other major publicly traded automakers.
GM is scheduled to report its fourth-quarter earnings on January 27.
