Automotive
The worldwide auto industry is taking a direct hit from recent tariffs, and the financial fallout is now becoming painfully clear. Two of the industry’s biggest players, Stellantis and General Motors, have revealed substantial losses in recent weeks — with billions wiped off balance sheets on account of shifting trade policies and provide chain pressures. And unfortunately for automakers and consumers alike, the damage may only be starting.
Stellantis Stalls Amid Tariff Shock and Slumping Sales
Stellantis, the parent company behind Jeep, Ram, Dodge, and Chrysler, just dropped some sobering news. The corporate reported a staggering $2.68 billion net loss for the primary half of 2025, directly blaming the impact of newly implemented tariffs and a troublesome sales climate, particularly in North America.
Shipments fell 6 percent globally in Q2, with North American deliveries plummeting by 25 percent — a lack of roughly 109,000 vehicles. That sort of volume drop is difficult to soak up, especially as the corporate struggles with what it calls “product transition aspects” and weaker fleet sales. Stellantis says $300 million of the loss got here directly from tariffs, but that’s only one piece of a bigger storm of canceled production, rising industrial costs, and unfavorable foreign exchange rates.
Recent CEO Antonio Filosa, who took over the reins in May, now faces the daunting task of steadying the ship. Though he stays optimistic and insists Stellantis has what it takes to bounce back, the brand’s U.S. foothold has clearly been shaken. Brilliant spots remain in international markets — with notable sales growth within the Middle East, Africa, and South America — but it’ll take far more than that to counterbalance the hit in its most profitable region.
GM Hit Hard, Too — And Bracing for More
While GM’s second-quarter results looked solid at first glance, a deeper dive reveals the toll tariffs are taking. The Detroit giant posted a $1.1 billion year-over-year revenue loss for Q2, with executives pointing squarely to tariffs because the important wrongdoer. And the bleeding won’t stop there. GM says it expects a $4 to $5 billion impact in total by 12 months’s end.
An enormous portion of that comes from Korean imports. GM builds several high-volume crossovers — just like the Trailblazer, Trax, Encore GX, and Envista — in Korea, and recent trade penalties are significantly raising costs for those vehicles. The corporate is scrambling to melt the blow by adjusting production strategies and shifting some manufacturing, which they hope could reduce tariff-related losses by as much as 30 percent. But as GM CFO Paul Jacobson noted, these fixes will take time to yield results.
Still, not all was doom and gloom on the earnings call. Due to a sales spike in April and May — when buyers rushed to dealerships to beat anticipated price hikes — GM posted record revenue of $91 billion for the primary half of 2025. SUVs led the surge, with the Chevrolet Equinox seeing a 20 percent year-over-year sales jump.
The EV story is more mixed. While Chevrolet became the second-best-selling EV brand within the U.S. last quarter, and Cadillac moved into fifth place, GM also acknowledged that the lack of federal EV incentives is beginning to bite. CEO Mary Barra reaffirmed the corporate’s long-term EV commitment, saying GM is concentrated on scaling electric vehicle production to match the profitability of its gas-powered offerings — but she made it clear the trail forward might be about adaptability.
Industry-Wide Impacts Mount
Stellantis and GM aren’t the one ones feeling the pinch. Automakers across the board are grappling with the unpredictable reality of a brand new trade environment, where tariffs can swing profitability overnight. As tensions rise between major economies, especially over EVs and battery components, more manufacturers could also be forced to make uncomfortable decisions — from shifting production to cutting costs, pausing model rollouts, or raising prices.
The ripple effect is already being felt by suppliers, dealers, and ultimately, consumers. Vehicles built overseas or reliant on foreign parts are more likely to change into dearer. Inventory levels could tighten again in some regions. And with the U.S. election season heating up, trade policy may change into much more volatile in the approaching months.
In brief, 2025 is shaping as much as be a defining 12 months for the worldwide auto industry — not only due to EV transition or changing consumer habits, but due to reemergence of tariffs as a core financial threat. Whether automakers can adjust fast enough stays to be seen.
For now, all eyes are on Stellantis and GM as they navigate the storm. The subsequent few quarters might be critical, and we’ll be following closely here at Automotive Addicts as this high-stakes battle between trade policy and profitability continues to play out.
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Lloyd Tobias is a seasoned automotive journalist and passionate enthusiast with over 15 years of experience immersed on this planet of cars. Whether it’s exploring the newest advancements in automotive technology or keeping a detailed pulse on breaking industry news, Lloyd brings a pointy perspective and a deep appreciation for all things automotive. His writing blends technical insight with real-world enthusiasm, making his contributions each informative and fascinating for readers who share his love for the drive. When he’s not behind the keyboard or under the hood, Lloyd enjoys test driving the latest models and staying ahead of the curve in an ever-evolving automotive landscape.
This Article First Appeared At www.automotiveaddicts.com
