What Happened to General Motors (GM)?

General Motors (GM) has been in a period of significant transformation and recalibration, particularly from 2024 through early 2026, as it navigates the transition from traditional internal combustion engine (ICE) vehicles to an electrified future. This period has been marked by strategic shifts, financial adjustments, and a renewed focus on profitability and disciplined capital allocation.

A major turning point has been GM's electric vehicle (EV) strategy. Initially, GM had aggressive targets, aiming for a production capacity of 1 million EVs in North America by the end of 2025. However, by mid-2024, CEO Mary Barra indicated that the company would not meet this target due to slower-than-expected market demand for EVs. This led to a "return to realism" strategy, characterized by a pivot towards a demand-driven model that includes reintroducing plug-in hybrids (PHEVs) and maintaining a strong grip on the highly profitable truck and SUV markets. In late 2024, GM also announced it would no longer brand its EV architecture, battery, and cells with the "Ultium" name, though the technology itself continues to be fundamental to its EV lineup. This recalibration also involved significant restructuring charges, including approximately $1.1 billion for EV capacity realignment in Q1 2026, following $7.9 billion in 2025.

Another critical development was the complete shutdown of GM's majority-owned Cruise robotaxi business in December 2024. This decision came after a serious accident in San Francisco in late 2023, which led to the revocation of Cruise's testing permit and significant reputational damage. The robotaxi venture had been incurring substantial losses, reportedly around $600 million per quarter in 2023. Following the shutdown, GM redirected its autonomous driving efforts, integrating Cruise technical teams with GM's own to advance its Super Cruise advanced driver-assistance system and focus on personal autonomous vehicles. By May 2026, GM announced that nearly 90% of the code for its autonomous driving systems is being generated by AI, with plans to launch an "eyes-off driving" version of Super Cruise in the Cadillac Escalade IQ by 2028.

Financially, GM has shown resilience. For the full year 2024, GM reported net income attributable to shareholders of $6.0 billion and EBIT-adjusted of $14.9 billion. In Q1 2026, GM reported adjusted EPS of $3.70, significantly beating Street expectations, and total revenue of $43.6 billion. The company's profitability was largely fueled by strong gas truck sales and a $500 million benefit from a U.S. Supreme Court decision regarding certain tariffs. Consequently, GM raised its full-year 2026 EBIT-adjusted guidance to between $13.5 billion and $15.5 billion. Despite these positive financial results, the company has undertaken workforce reductions, including laying off 500-600 salaried employees in its IT department in May 2026 as part of a restructuring effort.

Labor relations also played a significant role, with the United Auto Workers (UAW) strike in late 2023 leading to a new four-year labor contract ratified in November 2023. This contract included substantial wage increases and other benefits, impacting GM's cost structure. Furthermore, GM faced legal challenges regarding data privacy. In May 2026, it agreed to pay $12.75 million to settle claims in California that it illegally sold driver data collected through its OnStar Smart Driver program, which was discontinued in 2024. This followed a similar agreement with the Federal Trade Commission in 2025.

As of May 2026, GM is investing over $6 billion in its U.S. manufacturing operations for 2025 and 2026, focusing on propulsion systems and metal casting to support next-generation full-size trucks and SUVs, indicating a balanced approach between ICE and EV production. The company remains confident in its 2026 outlook, leveraging its broad portfolio and digital strategy.