Potential $14 billion tariff exposure for GM due to new 25% duty on vehicle imports.

From Yahoo Finance: 2025-04-13 08:45:00

President Trump’s 90-day pause on reciprocal tariffs brings relief to most countries with a new 10% tariff on goods. Automakers, however, face a 25% duty on vehicle imports and an additional 25% tariff on automotive parts next month. General Motors could be forced to alter its successful share buyback strategy.

General Motors has been aggressively buying back shares, impacting its stock price. Recently, GM approved a 25% dividend increase and a $6 billion share repurchase program. Despite this, GM faces a potential $14 billion tariff exposure due to its heavy reliance on imported vehicles and parts.

JPMorgan analyst Ryan Brinkman estimates GM imports $56 billion worth of vehicles annually from Mexico and Canada, with a potential $10 billion tariff. With a significant reliance on imports and parts, GM’s stock price could suffer. Brinkman lowered his price target for GM to $53 per share.

The looming impact of tariffs poses a tough choice for GM. The company may need to pause share buybacks to conserve cash, or continue the accelerated purchase program. Investors should be cautious, as tariff developments can quickly change. GM will likely focus on returning value to shareholders despite challenges.



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