GM Q3 2025 letter to shareholders
2025-10-21
To our shareholders,
As we reflect on the third quarter of 2025, I want to begin by expressing my sincere appreciation for the dedication and hard work of the entire GM team, including our employees, dealers, and suppliers. Their unwavering focus on our customers and ability to navigate an evolving regulatory and policy environment has been truly outstanding.
Performing well in a dynamic environment
Thanks to the collective efforts of our team, and our compelling vehicle portfolio, GM delivered another very good quarter of earnings and free cash flow. In the U.S., we achieved our highest third-quarter market share since 2017 with strong margins, and our restructured China business was profitable once again. Based on our performance, we are raising our full-year guidance, underscoring our confidence in the company’s trajectory.
Investing in American manufacturing and innovation
I also want to thank the President and his team for the important tariff updates they made on Friday. The MSRP offset program will help make U.S.-produced vehicles more competitive over the next five years, and GM is very well positioned as we invest to increase our already significant domestic sourcing and manufacturing footprint.
Earlier this year, we announced $4 billion in capital investments to onshore production at plants in Tennessee, Kansas, and Michigan over the next two years.
Once these investments come online, we plan to produce more than two million vehicles per year in the United States. We are also investing close to $1 billion to build a new generation of advanced, fuel-efficient V8 engines in New York. Importantly, we are maintaining our capital discipline while adding this production and creating new jobs.
Adapting to an evolving regulatory landscape
Over the past several years, our portfolio and capacity plans have been shaped by steadily increasing regulatory stringency for fuel economy and emissions. To meet these requirements, we aggressively expanded our electric vehicle capacity.
However, with the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned. That is why we are reassessing our EV capacity and manufacturing footprint, which resulted in a special charge in the third quarter, and we expect future charges. By acting swiftly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond.
As I have said, electric vehicles remain our North Star, and I am proud of the way our portfolio of Cadillac, Chevrolet and GMC EVs have connected with customers. We believe their performance will improve, even in a smaller market. At the same time, we will continue to invest in new battery chemistries, form factors, and architectural improvements to drive profitability.
Balancing EV and ICE investments
I’m equally confident in our ICE strategy. It’s clear that ICE volumes will remain higher for longer. We lead the industry today, and we are increasingly well positioned to meet strong, sustained demand.
For example, we are onshoring production of the Chevrolet Blazer, developing a next-generation Cadillac CT5 and redesigning and extending the Cadillac XT5. When Orion Assembly comes back online in early 2027, it will produce the Cadillac Escalade and then add our next-generation full-size, light duty pickup trucks.
Accelerating software and services growth
Looking ahead, our top priority is to restore North America to our historical 8–10% EBIT-adjusted margins. We are focused on driving EV profitability, maintaining production and pricing discipline, managing fixed costs, and further reducing tariff exposure. Cross-functional teams are also working to address warranty expenses by tackling root causes internally, with suppliers, and at dealerships.
Our software and services business is also expanding rapidly. Deferred revenue from OnStar, Super Cruise, and other offerings grew 14% from the second quarter to almost $5 billion, supported by a base of 11 million OnStar subscribers, including over 500,000 Super Cruise customers. We expect robust, double-digit revenue growth from OnStar and Super Cruise through the end of the decade, with gross margins of approximately 70%.
We are also making significant progress on our autonomous vehicle strategy and our next-generation software-defined vehicle platform, which will deliver smarter, more personalized vehicles, reduce complexity, improve stability, and unlock new revenue streams.
Looking forward
As we have demonstrated, GM’s commitment to building great vehicles, delivering exceptional customer experiences, and creating lasting value is unchanged. Looking forward, we believe our investments in advanced technologies, manufacturing, and talent will build on our solid foundation, and make GM even more innovative, resilient, and capable of leading through change.
Thank you for your continued support. I look forward to updating you on our progress in the quarters ahead.
Mary Barra
Mary Barra is chair and CEO of General Motors.
To our shareholders,
As we reflect on the third quarter of 2025, I want to begin by expressing my sincere appreciation for the dedication and hard work of the entire GM team, including our employees, dealers, and suppliers. Their unwavering focus on our customers and ability to navigate an evolving regulatory and policy environment has been truly outstanding.
Performing well in a dynamic environment
Thanks to the collective efforts of our team, and our compelling vehicle portfolio, GM delivered another very good quarter of earnings and free cash flow. In the U.S., we achieved our highest third-quarter market share since 2017 with strong margins, and our restructured China business was profitable once again. Based on our performance, we are raising our full-year guidance, underscoring our confidence in the company’s trajectory.
Investing in American manufacturing and innovation
I also want to thank the President and his team for the important tariff updates they made on Friday. The MSRP offset program will help make U.S.-produced vehicles more competitive over the next five years, and GM is very well positioned as we invest to increase our already significant domestic sourcing and manufacturing footprint.
Earlier this year, we announced $4 billion in capital investments to onshore production at plants in Tennessee, Kansas, and Michigan over the next two years.
Once these investments come online, we plan to produce more than two million vehicles per year in the United States. We are also investing close to $1 billion to build a new generation of advanced, fuel-efficient V8 engines in New York. Importantly, we are maintaining our capital discipline while adding this production and creating new jobs.
Adapting to an evolving regulatory landscape
Over the past several years, our portfolio and capacity plans have been shaped by steadily increasing regulatory stringency for fuel economy and emissions. To meet these requirements, we aggressively expanded our electric vehicle capacity.
However, with the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned. That is why we are reassessing our EV capacity and manufacturing footprint, which resulted in a special charge in the third quarter, and we expect future charges. By acting swiftly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond.
As I have said, electric vehicles remain our North Star, and I am proud of the way our portfolio of Cadillac, Chevrolet and GMC EVs have connected with customers. We believe their performance will improve, even in a smaller market. At the same time, we will continue to invest in new battery chemistries, form factors, and architectural improvements to drive profitability.
Balancing EV and ICE investments
I’m equally confident in our ICE strategy. It’s clear that ICE volumes will remain higher for longer. We lead the industry today, and we are increasingly well positioned to meet strong, sustained demand.
For example, we are onshoring production of the Chevrolet Blazer, developing a next-generation Cadillac CT5 and redesigning and extending the Cadillac XT5. When Orion Assembly comes back online in early 2027, it will produce the Cadillac Escalade and then add our next-generation full-size, light duty pickup trucks.
Accelerating software and services growth
Looking ahead, our top priority is to restore North America to our historical 8–10% EBIT-adjusted margins. We are focused on driving EV profitability, maintaining production and pricing discipline, managing fixed costs, and further reducing tariff exposure. Cross-functional teams are also working to address warranty expenses by tackling root causes internally, with suppliers, and at dealerships.
Our software and services business is also expanding rapidly. Deferred revenue from OnStar, Super Cruise, and other offerings grew 14% from the second quarter to almost $5 billion, supported by a base of 11 million OnStar subscribers, including over 500,000 Super Cruise customers. We expect robust, double-digit revenue growth from OnStar and Super Cruise through the end of the decade, with gross margins of approximately 70%.
We are also making significant progress on our autonomous vehicle strategy and our next-generation software-defined vehicle platform, which will deliver smarter, more personalized vehicles, reduce complexity, improve stability, and unlock new revenue streams.
Looking forward
As we have demonstrated, GM’s commitment to building great vehicles, delivering exceptional customer experiences, and creating lasting value is unchanged. Looking forward, we believe our investments in advanced technologies, manufacturing, and talent will build on our solid foundation, and make GM even more innovative, resilient, and capable of leading through change.
Thank you for your continued support. I look forward to updating you on our progress in the quarters ahead.
Mary Barra
Mary Barra is chair and CEO of General Motors.
