British investment bank and financial services company Barclays has adjusting its stance on the U.S. auto industry, shifting its rating from “neutral” to “negative” in the wake of mounting pressure from new import tariffs imposed by the Trump administration. Barclay also revised its GM stock rating, lowering it from “overweight” to “equal weight,” while slashing GM’s price target from $70 per share to $40 per share. The revisions follow similar downgrades from other financial institutions as the auto industry comes to grips with a barrage of changes and constant shifts in trade policy.
Barclays pointed to tariffs on automobiles, steel, and aluminum as key factors in undermining automakers’ profitability and constraining the capacity for innovation and investment. With regard to GM specifically, a central concern is The General’s production strategy. Nearly half of GM’s U.S. vehicle sales consist of models assembled outside the country, including several of its more affordable electric vehicles, which are manufactured in Mexico, thus heightening GM’s vulnerability to tariffs on imported goods and potentially eroding margins while complicating pricing strategies.
Meanwhile, Barclays gave Ford a slightly more favorable outlook, arguing that Ford is less exposed to tariff-related headwinds as a larger share of its production is based inside the U.S.
Just last week, financial services firm UBS announced that it had downgraded its GM stock rating from “Buy” to “Hold,” stating that the recent automotive tariffs could increase annual costs by upwards of $5 billion. UBS also cut its GM stock price target from $64 to $51. Meanwhile, Goldman Sachs maintained a “Buy” rating for General Motors, but cut its stock price target from $73 to $63. Other legacy automakers were also hit last week, with Goldman Sachs downgrading its Ford stock rating from “Buy” to “Hold,” while cutting its Ford stock target price from $11 per share to $9 per share.
Earlier this week, President Trump said he was open to helping automakers reeling from the new tariff announcements, however, details on what that relief may look like remains vague.
Comments
Great news.
Mediocre leadership leads to mediocre stock prices.
That’s a foregone conclusion.
And why is Ford in a more favorable position? Because they have more US production. The solution is there.
Less emphasis on EVs?
GM also sells a lot more vehicles, internationally than Ford. In 2023 the number was GM had 1.8MM more global sales than Ford
the umpa lumpa is going to bed dreaming…DID I DO THAT!
Trump seems hellbent on destroying the US Auto Industry and new car market. The Mad King is truly insane and has zero understanding of how the world actually works.
Even if Trump somehow manages to keep the auto tariff madness going through the midterms next November, it will be far cheaper for automakers to muddle through the next 18 months than to try to move production of low-cost cars to the US. The democrats will win the midterms and take the tariff keys away from senile Grandpa Trump. The cost of relocating factories along with remarkably high UAW labor and benefit costs make long-term entry-level vehicle production in the US a non-starter.
High labour + benifit costs???? How do you explain this ? ( I worked for G. M. In Ontario Canada.) New contract Sept.1983. ( Not YOUR 51 st state.) Auto analysts (experts ) Said total labour+benefits costs in a North American vehicle built in Canada was Up from 8 % to now 10%. Now that Canadian auto workers union separated from U.A.W.. union. And are now the Canadian Auto workers Union. Yes everyone kept ( like you )” YAKING” Bad auto workers there fault. You don*t realize more income more taxes. This helps to pay for subsidies poorer people get. Yes BAD GREEDY AUTO WORKERS there earnings are tax free. Are your eyes brown.? Because you are full something not grey matter?? Why SOTUNY YUK YUK YUK.