GM Expects $3 to $4 Billion Tariff Hit in 2026

Automaker says tariffs will impact profits, as Trump threatens to restore 25% tariffs on South Korean imports

Jan. 28, 2026 at 3:39am

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General Motors CEO Mary Barra told Wall Street analysts that the company expects Trump administration tariffs will cost the automaker $3 billion to $4 billion in 2026. However, this figure could rise further if President Trump follows through on his threat to restore a 25% tariff on South Korean vehicle imports, up from the current 15% rate.

Why it matters

Tariffs have been a major challenge for automakers like GM, forcing them to absorb much of the increased costs rather than passing them on to consumers. This latest tariff threat from the Trump administration adds further uncertainty and financial pressure on GM as it navigates the transition to electric vehicles.

The details

GM had previously estimated tariffs would cost the company $4 billion to $5.5 billion in 2025, but that figure was reduced to $3.5 billion to $4 billion after the Trump administration lowered tariffs on South Korean imports. However, Trump has now threatened to restore the 25% tariff rate, which would impact GM's lower-priced models like the Chevrolet Trax and Trailblazer that are imported from South Korea. To offset the tariff costs, GM has been raising sticker prices and reducing incentives, with the base price of the Chevy Trax rising 9.3% for the 2026 model year.

  • In 2025, GM estimated tariffs would cost $4 billion to $5.5 billion.
  • In 2026, GM expects tariffs to cost $3 billion to $4 billion.
  • On Monday, January 27, 2026, President Trump threatened to restore a 25% tariff on South Korean vehicle imports.

The players

Mary Barra

CEO of General Motors.

Donald Trump

The former President of the United States who imposed tariffs on various imports, including vehicles.

Chevrolet Trax

A compact SUV model produced by General Motors that is imported from South Korea.

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What they’re saying

“We continue to believe in electric vehicles.”

— Mary Barra, CEO, General Motors

What’s next

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The takeaway

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