General Motors announced this Thursday that it will take an accounting write-down of US$6 billion to dismantle some investments in electric vehicles, in the most recent announcement of the automaker’s retreat in the area after falling demand amid Donald Trump’s government policies.
The impact stems from the reduction in production of electric cars compared to planned and the consequences on the supply chain, GM said. Weeks earlier, Ford Motor made a similar announcement. but much bigger.
The bulk of GM’s writedown — a $4.2 billion cash charge — is related to cancellations of contracts and agreements with suppliers, which had planned much higher production volumes.
GM said the writedown will not affect its current lineup of about a dozen electric models in the United States. “We plan to continue to make these models available to consumers,” the company said.
Many U.S. automakers, including Ford, have been reducing production of electrified models since the middle of last year. Electric vehicle sales plummeted after the Sept. 30 elimination of a $7,500 federal credit for electric vehicle buyers.
In December, Ford said it will write down $19.5 billion over several quarters as it canceled several electric vehicle programs, including the electric version of the F-150 pickup truck, as well as another electric pickup truck and an electric van.
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GM, the largest U.S. automaker by sales, has made one of the biggest bets on electric vehicles among global automakers, promising at one point to phase out combustion-powered cars and trucks by 2035.
While GM has not publicly backtracked on its 2035 target, analysts have sharply cut the industry’s electric vehicle sales forecast for the next decade in the U.S., GM’s largest and most profitable market. GM Chief Executive Mary Barra said the company will respond to customer demand.
The automaker began reducing some investments related to electric vehicles last year. This month, GM halted production of batteries for electric vehicles at two plants for six months and reduced production to one shift at an electric vehicle-only plant in Detroit.
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The company also abandoned plans for another Michigan plant that was slated to produce electric vehicles and will instead assemble the Cadillac Escalade utility vehicle and pickup trucks.
GM’s electric vehicle sales fell 43% in the fourth quarter after the North American incentive ended. Sales reached record highs in the previous threemonths as customers rushed to buy electrified vehicles before the incentive ended.
Automotive data provider Edmunds expects electric vehicles to represent about 6% of total U.S. vehicle sales in 2026, up from 7.4% in 2025.
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Ford’s decision, in which the company essentially eliminated its entire planned second generation of electric vehicles, resulted in a much larger accounting impact. Ford Chief Executive Jim Farley said it was a painful but necessary move as the market cooled.
Ford is now pinning its electric vehicle hopes on an all-new architecture that will allow it to produce more affordable models, starting with a $30,000 electric pickup truck in 2027.
