Investors are still coming to grips with a rollercoaster week following President Trump’s on-again-off-again tariff announcements. Car makers were among the most heavily impacted, including GM. Despite a broader market uptick following President Trump’s announcement of a temporary tariff pause, General Motors is now facing renewed investor caution in light of a 25-percent tax on vehicles assembled outside the U.S.
General Motors stock rose by 7.7 percent following the announcement that some of the new tariffs would be lower than announced initially, with stock values for other major automakers like Ford, Tesla, and Toyota rising as well. However, that surge may prove short-lived.
While the Trump administration’s tariff delay and reduction announcements sparked a stock market rally on Wednesday, the new automotive tariffs remain intact, and are expected to extend to vehicle components next month. Given roughly half of all new vehicles sold in the U.S. are imported, the financial impact is likely to be significant.
Per a report by Barrons, UBS analyst Joseph Spak downgraded GM stock from “Buy” to “Hold,” citing mounting concerns over automotive tariffs that could increase annual costs by as much as $5 billion. Spak also slashed his stock price target for General Motors from $64 to $51.
The downgrade aligns with a broader trend on Wall Street as analysts recalibrate expectations for legacy automakers. Goldman Sachs analyst Mark Delaney downgraded Ford from “Buy” to “Hold” and its target price cut from $11 to $9, citing weak consumer demand and tariff concerns. Delaney kept a “Buy” rating for General Motors, but cut the price target from $73 to $63.
Across the sector, “Buy” ratings have declined, with only 20 percent of analysts maintaining a “Buy” recommendation for Ford. General Motors fares better with a 55-percent “Buy” rating, but that figure has trended downward amid growing macroeconomic pressures. The average GM price target is set at $58.50.
Comments
Should be “sell”.
Meh, it’s all manipulated BS anyway.
General Motors’ heavy dependence on Chinese production and technology has made it particularly vulnerable to Chinese tariffs, reflecting strategic choices that favored short-term benefits over long-term stability and national interests.
The leadership at GM, including certain union representatives, has faced criticism for prioritizing personal interests over the welfare of the company, its shareholders, and the broader national economy. Their decisions have not consistently honored the legacy and responsibilities tied to GM’s historic role.
The Trump administration should compel GM to immediately sever ties with SAIC and FAW to mitigate risks and realign the company with national interests.
As the largest private shareholder, Mary Barra’s practice of selling shares shortly after they vest raises concerns about her commitment to GM’s long-term vision. Questions persist about whether her leadership is best suited to navigate GM through its current challenges.