GM to take $6 billion charge after EV pullback

"GM, which had been the most ambitious among all U.S. automakers with plans to replace internal combustion engines, said in its filing with the Securities and Exchange Commission late Thursday that the $6 billion in charges includes non-cash impairments and other non-cash charges of about $1.8 billion as well as supplier commercial settlements, contract cancellation fees, and other charges of approximately $4.2 billion."

"The charges that will be recorded in the fourth quarter follow an announcement in October that the Detroit automaker would take a $1.6 billion charge for the same reason in the previous quarter, with automakers forced to reconsider ambitious plans to convert their fleets to electric power. The EV tax credit ended in September. The clean vehicle tax credit was worth $7,500 for new EVs and up to $4,000 for used ones."

Shares fell nearly 3% after GM said it will record about $6 billion in charges in the fourth quarter, including roughly $1.8 billion in non-cash impairments and about $4.2 billion in supplier settlements, contract cancellations and other charges. The charge follows a prior $1.6 billion hit and reflects weakening economics after the clean vehicle tax credit ended in September. GM previously committed large investments and factory conversions to electric vehicles with goals for majority EV production by 2035 and company-wide carbon neutrality five years later. Shifts in U.S. policy and Chinas rapid EV expansion have altered the competitive landscape.

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