Yahoo Finance·2025-12-17 19:24Core Insights - Detroit auto giants, particularly GM, are reporting strong profits from their internal combustion engine (ICE) operations despite losses in electric vehicle (EV) sectors [1][5] - GM expects adjusted pre-tax profits between $12 billion and $13 billion in 2025, with adjusted earnings per share (EPS) guidance raised to between $9.75 and $10.50 [1] - Ford has announced a significant $19.5 billion charge related to its EV strategy, halting production of the all-electric F-150 and shifting focus to hybrids and extended-range electric vehicles (EREVs) [2] Financial Performance - GM's financial performance has been impressive, with a 49% rise in stock value over the past year, outperforming Ford [7] - Ford and GM have gained 38% and 53% in stock value respectively this year, despite challenges from tariffs [5] - GM's share count has decreased by 15% year-over-year due to aggressive share repurchases, which are expected to continue [7][8] Market Dynamics - The U.S. automotive industry is experiencing a shift due to the phasing out of the EV tax credit and changes in fuel economy standards [4] - Tesla's CEO anticipates "a few rough quarters" ahead for EV adoption rates, indicating broader challenges in the EV market [3] - Morgan Stanley upgraded GM based on its capital discipline while downgrading Rivian and Tesla amid industry challenges [9] Future Outlook - GM's forward price-to-earnings (P/E) multiple is currently at 7.8x, with expected earnings growth of 12.7% next year, resulting in a PEG multiple of 0.92x [10] - While significant gains like those seen in the past may not recur in 2026, GM is expected to continue benefiting from its legacy ICE business [11]