Good morning, and welcome to the General Motors Company Second Quarter 2025 Earnings Conference Call. During the opening remarks, all participants will be in a listen-only mode. After the opening remarks, we will conduct a question and answer session. We are asking analysts to limit their questions to one and a brief follow-up. As a reminder, this conference call is being recorded Tuesday, July 22, 2025. I would now like to turn the call over to Ashish Kohli, GMC Vice President of Investor Relations.

Thanks, Amanda, and good morning, everyone. We appreciate you joining us as we review GM's financial results for the second quarter of 2025. Our conference call materials were issued this morning and are available on GM's Investor Relations website. We are also broadcasting this call via webcast. Joining us today are Mary Barra, GM's Chair and CEO, and Paul Jacobson, GM's Executive Vice President and CFO. Susan Sheffield, President and CEO of GM Financial, will also be joining us for the Q&A portion of the call. On today's call, management will make forward-looking statements about our expectations. These statements are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include the factors identified in our filings with the SEC. Please review the Safe Harbor statement on the first page of our presentation as the content of our call will be governed by this language. And with that, I'm delighted to turn the call over to Mary. Thank you, Ashish, and good morning, everyone.

Today, we reported another quarter of earnings that highlights the core strengths of General Motors. They include the appeal of our vehicles, customer loyalty to our brands, the growing value of technologies like OnStar and Super Cruise, as well as the creativity and resiliency of our global team. I am grateful for everyone's contributions. Our employees, our dealers, and our suppliers. In the US and around the world, we have demonstrated consistent execution of our production and go-to-market strategies. We do have opportunities from a quality perspective at both the supplier and the GM level, which Paul will talk more about in his remarks, but we are fundamentally very strong and resilient. As we discussed today, we have delivered strong underlying operating performance and we are positioning the business for a profitable long-term future as we adapt to new trade and tax policies and a rapidly evolving tech landscape. Our clear priorities are to grow our already expansive US manufacturing footprint and domestic supply chain, further strengthen our international business, and continue to innovate in batteries, software, and autonomous technology. In China, we have been working closely with our JV partner to improve sales, inventory management, costs, and profitability. The performance of our new energy vehicles has been especially strong, and in Q2, we reported our second consecutive quarter of year-over-year sales growth. We were the only foreign OEM to gain share, and we reported positive equity income. In the US, the industry saw a spike in demand during the quarter due to tariff-related sales pull-ahead, especially in April and May. Then in June and July, demand returned to levels that are in line with our full-year outlook of 16 million units. Throughout the first and second quarters, GM outperformed the market in total, fleet, and retail market share year-over-year.…

Thanks, Mary, and good morning, everyone. Appreciate you taking the time to join us. The team continues to execute well on our disciplined strategy which leverages our leading product portfolio and emphasizes prudent inventory management to support stable pricing while delivering consistent performance. Our agility and responsiveness to evolving consumer preferences and regulatory demands remain key strengths that set us apart. For the first half, total company revenue was a record $91 billion driven by strong demand, stable vehicle pricing, and continued growth at GM Financial. North America revenue was also a first-half record at nearly $77 billion up slightly year over year. We maintained production levels in line with our full-year plan as early quarter sales acceleration normalized. This measured approach combined with strong sales that outpaced the industry reduced U.S. Dealer inventory to 526,000 units down nearly 10% year over year almost 12% compared to the end of 2024. EBIT adjusted was $3 billion for the quarter, inclusive of a net tariff impact of approximately $1.1 billion with minimal mitigation offsets. As we've previously mentioned, mitigation efforts will take time to yield results. Limiting their effect on the second quarter. However, we're still tracking to offset at least 30% of the $4 billion to $5 billion full-year 2025 tariff impact through strategic actions such as manufacturing adjustments, targeted cost initiatives, and consistent pricing. Looking at our sales performance, GM's U.S. Market share reached 17.3% in the first half of the year, marking a consistent upward trend and a 1.2 percentage point increase year over year. More than double the gain of our closest competitor. As Mary mentioned, continued growth across a number of SUV segments was a key driver with the Chevrolet Equinox standing out as its total sales rose more than 20% compared to the same period…

As a reminder to analysts, we are asking that you limit your question to Our first question comes from the line of Mike Ward with Research. Your line is open.

Thanks. Good morning, everyone. Paul, I wonder if you could walk through the accounting for the $600 million you called out on the delta with the EVs Hey. Good morning, Mike. So think you're referring to the lower of cost or market adjustment? Exactly. Yeah. Yeah. So as a reminder, you know, with the sell inventory that we have we are required to mark any potential losses on that inventory and take it to the that reflects finished goods, etcetera. And as we work towards EBIT profitability, over time, that'll start to come down. But as we are seeing adjustments in the market, as we are looking at expectations on pricing as well as production and demand, we made an adjustment to that reflecting what we think is future pressure on EV sales in going forward related to that inventory. That number will we expect, ultimately get better as inventory comes down and we see more stability in pricing. But think about it as more of timing. From that standpoint. And, you know, we expect that it'll get better over time. And just as it relates to tariffs, you're taking as the world sits today and you talked about the input $4 to $5 billion mitigation, What would be the best case scenario? We get a settlement with US Canada, Mexico, Korea, What would the impact look like over the right now, like, for this year? If the world changed tomorrow, and it went back the other way? And then what do you have strategically that help you from a performance standpoint as you as you go forward with your the $4 billion investment.

Yeah. Michael, it really I mean, obviously, our tariff impact would be lower if the tariffs with Mexico, Canada, and Korea were lower. So, you know, that would have an immediate impact, you know, have to look at how much lower it's going to be to know what the total impact there would be. Right. But, yeah, that would have a immediate because as Paul said earlier today, we have continued to bring the vehicles in from Korea because they're contribution margin positive and they're in very much in demand. I mean, customers love those vehicles. Yeah. We've made some short term shifts of production into our US footprint. I think what's gonna happen though, as we've always said, we feel we'll be able to offset 30% A lot of that will come in later this year as well as we'll continue to make improvements across the board as we get into next year. In 18 months from now, the capacity, the $4 billion that we talked about that capacity will come online and then that will have another step function improvement. And in some cases, the capacity we're adding is also for unmet demand. So it's a win-win from that perspective. So, you know, we're on a think, a positive trajectory as we look into later this year into next year and clearly into 2027. We'll be substantially better. And to your original question, when we see what the final agreements are between these key countries for us, you know, then we'll be able to size that as well.

But you're prepared for the worst case scenario, so there there potential for some upside the way we look at it.

I think that's a fair comment. I think that's a fair comment. I don't wanna predict what were the cases. Right. But I think with what we know today, I think that's what we've that's what we've used. So I think there's potential.

Yeah. I don't think anybody can predict what's gonna happen. So thank you very much. Thank you. Thanks, Mike.

Thank you. Our next question comes from Dan Levy with Barclays. Your line is open.

Hi, good morning. Thanks for taking the questions. I wanna start first with a question on pricing. And appreciate the commentary that the reason price in the North America EBIT bridge was negative on fleet, but we did see pretty solid third party data. So retail was tracking up decently based on the third party data. Retail is about majority of your sales. Maybe you could just double click on the dynamics there. And, you know, as far as the second half goes, how do we reconcile the assumption of pricing sort of held where it is versus the notion that as others run out of pre-tariff inventory and inventory is now more expensive, others may now need to raise prices.

Hey. Good morning, Dan. Thanks for that. And you know, not not surprised by the question. You know, I think a couple of things. Number one, as we talk about fleet, it's largely a a comp issue too because remember what we're lapping is fleet deals that were done under significantly tighter inventory than even where we are today at at our tight levels. So, you know, we think that's that's some normalization. I mean, we're still comfortable with our pricing assumption of, you know, up a half to to one percent for the year going forward. We had the the strength in the first quarter. We have tougher comps really through the middle of the year, but as we launch our model year 2026, vehicles with, you know, our our sort of regular pricing strategy that we've encountered. We we still see that working quite well. So I think there's a little bit of noise in the quarter here. That we will work through, but nothing has changed about the full year. You know, what there's a there's a lot of talk about out there about what people are going to do with they're not going to do is, as we've said before, we're pursuing our own sort of commercial path, one that is really centered around the us. So so despite having lower incentives significantly lower incentives than the industry average, we're still picking up share. So, you know, I think to the extent that you know, we see pricing change, we're gonna continue to look at it you know, according to where we see the demand for our products, which remains strong, and I

Okay. Great. Thank you. That's helpful. Second question is just about the EV strategy going forward, and appreciate the commentary about you wanna give consumers choice, but I now that, the tax credit is on its way out and there's changes in the regulatory schemes, I I know we've been a a broad lineup across price points, but the the profitability has been challenged. And I think these changes indicate profitability is probably gonna get a little trickier. So especially given you're you're losing some of the scale benefits, which was supposed to drive profit. So how do we look at you know, the the the depth or the breadth of your EV lineup going forward and the price points at which you're offering vehicles I when it seems like it's just gonna be much tougher to get profitability at the more lower price point. Is it that we just see higher price points, and that's the strategy?

Well, I I think we're you know, we have a very strategic EV portfolio when you look at luxury trucks and then the affordable vehicles like the the Blazer and the Equinox EVs. And so we think we're covering the market very well. Before we even had IRA and the $7,500 tax credit and and some of the other portions of that, there still was demand for EVs. And we think as charging grows, and one of the things we highlighted because we are continuing very capital efficiently through partnerships to make sure we continue to expand the EV charging network. I also think there's an opportunity for EVs for those that have a two car family that have a garage that they can charge You know, it makes a lot of sense to have that one of those two vehicles be an EV. So I think as we get through this period and we we go through the potential pull ahead and before the September first, where the consumer tax credit goes away, then we get to fourth quarter, we'll probably see a little result of that pull ahead. We get into 2026, so I think we'll start to understand what real EV demand is. What we have been saying is the what we're investing going forward is largely focused on improving our EV profitability. The announcements we've made from a battery perspective, with LMR and LFP, some of the work that we're doing as we move forward to have a lighter architecture is more aerodynamic that allow us to use a smaller battery. So we're very focused in this period of time to drive not just get to variable profit profitability, but get profitability and then, you know, to continue to improve so we have appropriate and strong margins from our EVs as well. And then we're very well positioned in the market for later in this decade into next decade and we truly offer consumers choice. So we think we've got the foundation with the EV platform that we have that allows us to go, you know, from a very small vehicle all the way up to a super truck like the Hummer. We think that's an advantage for us. We think there is going to be an EV market that will grow over time, albeit it'll start lower and potentially grow more slowly. But we're well positioned to do that. And, you know, right now, we're seeing growth in both ICE and EV from a share perspective with, as Paul mentioned, very

And there's a clear path to grow to get profitability on the affordable EV?

I'm sorry.

Hear the beginning of your question.

There's a there's a clear path to get the profitability on the affordable EVs.

Well, you know, that that is what we're working on from from all aspects. And, definitely, the battery technology changes. And you know, as we grow with affordable, which is in the heart of the market, that gets us the scale benefits as well. So we are focused on each and every vehicle getting to profitability and we're not going to stop until they do. Great. Thank you.

Thank you. Our next question comes from Ryan Brinkman with JPMorgan. Your line is open.

Great. Thanks for taking my question. I wanted to ask on the impact of tariffs on your earnings power as we move beyond this year? Now earlier you'd called out $4 to $5 billion of tariff impact over the course of 2Q through 4Q 2025. So annualizing to maybe $5.3 to $6.7 billion. The goal of mitigating at least 30% of the impact this year. But that was before the various investments in US manufacturing announced during the quarter. How should we think about these footprint actions impacting net tariff costs going forward? You know, what degree of tariff cost mitigation beyond the 30% target for this year do you think you might be able to accomplish after these investments come online in 18 months time.

Yeah. Good morning, Ryan. I'll I'll take that one. Thanks for the question. You know, We have we highlighted that up to $4 billion to $5 billion about $2 billion of it is Korea. And as Mary mentioned in in their comments and recent question that you know, obviously, the trade deals with Mexico, Canada, and Korea are gonna be important. We're not speculating on what those are going to look like. Going forward, but, you know, there is a there there is a possibility, and I don't a likelihood, if you will, that that ultimately, a a tariff rate gets set at a lower level, which would ultimately bring that impact down. As far as the other aspects of the tariffs, you know, we talked about the $4 billion which will bring us when all that is implemented to producing over 2 million vehicles here in the US. That will take care of part of a large part of the of the other remaining tariffs that are out there. We're still working through supply chain and and other indirect tariffs, but we're not speculating on what it'll be. But I expect that that it is likely lower than the the the current run rate of what you would see just as things shake out. Remember, we're only 90 days into this. As to the 30%, I mean, these are these are shifts in the in sort of the general operation of the business that we don't necessarily think go away. If if tariffs are reduced. So, you know, I think we've got a longer term plan to be able to mitigate a substantial part of this. You know, we're we're obviously looking for things to normalize around these trade deals that will get done. And we we we expect that'll happen. But, you know, it's it's too soon to extrapolate that as a run rate into the future.

Very helpful. Thank you.

Thank you.

Our next question comes from Joe Spak with UBS. Your line is open.

Thanks. Good morning. Paul, just maybe turning back to of the tariff comments, and I understand you know, it it a lot has changed. But you did mention that you expected the biggest headwind to be in the second quarter, and now it seems like the third quarter. So maybe you could just sort of help us understand what you know, large buckets, what sort of changed within that. It it seems like in the slide you're missing indirect tariffs, which is maybe commodities and or maybe there's something with the mitigation efforts. Just any any color you have there. Yeah. Yeah. Thanks, Joe. You you you got it. It's it's really on a lot of the indirect items that, you know, we were when we came out with the overall tariff guidance, we we were estimating the timing on when some of that would hit. So, you know, I would expect that we would have more expense potentially in the third quarter, but we're still tracking on that $4 to $5 despite all the changes that we've seen going forward. So you know, it might be slightly higher in the third quarter, and that's that's kind of what we're thinking right now. On the cash side, we actually expect that that cash impact you know, potentially to be lower. We're still, you know, didn't get the full benefit of the MSRP offset just because of the timing. So that'll materialize in the second half of the year. On the cash side. But from an expense side, just think slightly higher in 3Q, but still on track for the $4 billion to $5 billion for the year.

Okay. And then and then just turning back to EVs and and and, you know, regulatory policy, but maybe from a little bit of a different angle, You you know, I know in in your K, you disclosed that last year you expensed a billion dollars for credits. Was wondering if you'd let us it doesn't sound like you expect much sort of change to this year, but I was wondering if you could let us know how much you are counting on that expense to be this year. And is it fair to assume you have a if we're comparing 2026 to 2024, you have a potential $1 billion tailwind. From credits.

Yeah. Joe, it gets it gets really complicated really fast as you might imagine with the different regulatory schemes. But what's what's in there is CAFE, GHG, state regulations, etcetera. So what we know today is, you know, the the the CAFE penalties under the one big beautiful bill were were zeroed out. So we did have some, balance sheet purchased credits that were there this year, but we also have some expenses that we had that already booked. That's gonna basically be a wash for us. So I don't expect any material adjustments from Cathay. GHG obviously has not been fully answered. We we we have comments from the administration and, you know, in the one beautiful one big beautiful bill, you know, there are changes to future compliance, but we're still working through that across the board. So I think 2025 is a little bit of a transition year as we as we understand what the future landscape is going to be and what how that's going to affect the credits and the liabilities that are on the balance sheet year. But going forward, we do expect to be more, I guess, a lower expense rate for compliance in the future.

And just I would add to that, it also gives us the opportunity to sell EV vehicles excuse me, ICE vehicles for longer and under or appreciate the profitability of those vehicles while we're, you know, month by month, quarter by quarter, year by year in improving our EV profitability. So I think it's a huge opportunity.

Thank you.

Thanks, Joe.

Thank you. Our next question comes from Eytan McKelley with TD Cowen. Your line is open.

Great. Thank you. Good morning, everyone. Just first on the guidance, just given still the wide range second half of the year, $3.5 billion to $6 billion I'm just curious what some of the factors that that could materialize that could cause you to be at the low versus high end of that range and whether you have a current bias within the range currently?

So thanks, Itay. You know, as as we, you know, have continued to practice as we generally use midpoint convention as how we're thinking about things. The reason to not change is obviously there's there's still things working out. We don't want a lot of volatility in our guidance from that standpoint. But as we as we look at the landscape, some of the things that that could help us are, you know, getting some of the offsets as we've talked about. Potentially overperforming on that. Some of the challenges are, you know, higher tariff rates for longer. But but overall, you know, we're we're we're aiming for the mid point, and that's that's the way we we we try to shoot straight. Across the guidance. So as the year progresses, you know, we'll have an opportunity to tighten that range as we know more.

Great. That's helpful. And then just as a follow-up, just with with wholesale volume declining on seasonality and you've gained some nice market share. Your inventory is in good shape going into second half the year. Any thoughts on where, you know, US dealer inventory could end the year roughly?

Well, I mean, we we we remain committed to our 50 to 60 day target at the at the end of the year. You know, that obviously fluctuates with changes in demand, but clearly the vehicle counts as we highlighted in our comments was down pretty significantly year over year. You know, we we have responded, I think, the right way with some component availability into our customer care and after sales group. To address some of the more specific warranty issues to make sure customers are getting their vehicles back faster. That was a very calculated measure that impacted our wholesales. To be honest, and something that, you know, I think ultimately we can we can that we'll have an ability to potentially improve our wholesale But nothing has changed from that target of wanting to get to that 50 to 60 day target range.

Perfect. That's all very helpful. Thank you.

Thanks, Zita.

Thank you. Our next question comes from Adam Jonas with Morgan Stanley. Your line is open.

Thanks, everybody. And Mary, about fifteen or twenty years ago, GM was leading the industry in humanoid robot development, working together with NASA. On Robonaut one and then Robonaut two deploying an upper body humanoid on the International Space Station in 2011. Fast forward to today, and most of your key competitors have a humanoid program. And many, myself included, think that this market's ten times larger than cars at least. So when can investors learn more about GM's robotics chops in your in house in your in house robot facilities? Mary, as an engineer, I I'm sure you must be super excited about the opportunity to show investors where GM can dominate here. And, Mary, I I actually think that this is good for the UAW. Because we need American human muscle to develop build, and service these robots. So when are we gonna learn more?

Well, Adam, thanks. I actually didn't work directly on that project, but it was in the area I was responsible for. So I know the NASA partnership you're talking about very well. You know, also we have a very long and rich history with GMF. Excuse me. GM Robotics, GM Fun Ups. Sorry. And we still have a very, very strong partnership. So we have a a core capability in the company for sure. There's also partnerships that we're looking at and strategic relations that we have. But as we look at automation overall, you know, our first look is we want to not only lead from a from what happens from a robotics perspective, because remember, a lot of things that we leverage robotics for are areas where there's safety challenges to do the work. If there's ergo challenges, we have a very robust ergonomics program in this company to make sure people don't get hurt doing their jobs. And then just difficult or very, you know, dirty tasks that frankly, no one wants to do and I don't blame them. And so there's a lot to do there. There's also work to do to get rid of a lot of the indirect. But we've also done a lot of work from a winning with simplicity perspective, and we've talked about that for the last few years. But first has been focused on what was I'll say some of the low hanging fruit to simplify how we go to market from a trip level perspective, free flow options, etcetera. But now we're really getting into part design where the parts are are just simpler parts or or a part that integrates and does more functions. So there's tremendous work going on across the company to lead to manufacturing efficiency. And then, like I said, as we as we go forward, we're gonna continue to capitalize on core knowledge that we have in this company to make sure we're driving efficiency. I'm also very proud of the fact that, you know, way back when when assembly lines and all the equipment in a plant was controlled by wires and relays, we did training programs partnering with the low the local community colleges to train our workforce to be able to leverage how we run automation today, you know, from a computer perspective we have an active training program that we right now where we're training more and more electricians and technicians as we have more complexity in our plants, And so we're going to continue to do that. Something I'm very proud of. And I do agree there's huge opportunity for our workforce as we look to what technology has to offer to improve the jobs But overall, we're focused on what's gonna drive manufacturing optimization of

That's great, Mary. That sounds like stay tuned and bless you for investing in those important areas in our country. Just as a follow-up, on EV profitability. I want to return to that. Tesla is still seen as the benchmark in Western EVs. By many. Maybe you're now the new benchmark. Or the new emerging benchmark. But in Western EVs, they're still the big the big dog. But if you remove ZEV credits, which is probably appropriate, and downstream retail, they're loss making. I mean, they're worse than Reno. Their margins are worse than Stellantis. They would they would really love to have your GMI margins as so so add this to Elon's it seems to be also exiting the auto and clearly pulling capital out of the business and doubling down on AI and autonomy and robotaxis. So how does GM expect to be profitable with EVs when players like Tesla are apparently cannot. I was just wondering what you'd highlight as your your differentiation in terms of how you configure the vehicles or your scale or or something about, you know, working with the working with the the Koreans and your and your in house work something. What when you benchmark Tesla, why are they loss making and you feel that you can be profitable? Thanks.

Well, I think, you know, one of the things I'm very proud of it I'm not gonna comment on Tesla because there there's a lot there, and I as you know, I don't usually comment competitors. But I think when I looked specifically at General Motors, one of the reasons our EVs are doing so well from a customer perspective is they're true to our brands, whether it's Chevrolet, whether it's Cadillac, whether it's GMC, Hummer, and and GMC. Also, beautifully designed vehicles that have the range and the performance that customers are looking for, whether you're talking about a truck or all the the, technology and safety. We you know, we put into an Equinox. We're that's what we're known for, and and that beautiful design with also efficiency. As Paul said in his opening remarks, we still believe we have tremendous opportunity to as as we did our first DB platform to to make changes to that to drive more efficiency from a from a weight perspective, from a simplification perspective. The same is true for batteries, and we're investing in future technologies that are gonna allow us to take significant cost out and then we will get scale. And one of the things I'm really excited about with how we grow have been growing our share quarter after quarter is the support that we have from our dealers who now really understand EVs, they understand what the customer's looking for, like I said, I think we can improve that scale when we think about two two family two car families. That have a an opportunity to have one of those vehicles in the garage b EV, even before the the charging infrastructure's built. It's gonna be it's gonna be beautifully designed products, with brands, people, truck, trust. Remember, we have the highest loyalty. Going to be having the right technology on the vehicle, getting that scale, and then the engineering solution. So I'm very very bullish on where we're gonna be on EVs as we continue to move forward in the next couple of years.

And Adam, I'll just add too. I think the other asset that we have is, you know, a lot is made about Tesla's simplicity and and and their scale and clearly, you know, within a couple of narrow segments. They do have that and they realize some good advantages and hats off to them. It also leaves them overexposed to, you know, a a demand set that has been highly volatile. When you look at what we've done in Spring Hill and what we've announced that we're going to do in Fairfax, we're increasingly building flex flexibility into our operation, into our manufacturing plants that as we go through this period of transition, however long it might be, where where customers are adopting EVs at a slower or faster rate that is gonna change year to year you know, for the for the foreseeable future. That built in flexibility for us to switch between ED and ice and make sure that we meet customers where they are is an inherent advantage that we have because we can absorb some of the cost of that manufacturing facility with more ice production if EV demand goes down. So that flexibility is gonna be important for us as we as we go through the next several years, and I think it's gonna be helpful on that journey.

Thanks, Paul. Thanks, Mary. Thanks, Adam.

Thank you. Our next question comes from Tom Narayan with RBC Capital Markets. Your line is open.

Hey. Thanks for taking the question. I wanted to little do a little more maybe drilling down on the on the Korea operation you guys have. I know it's a a substantial part of the the tariff amount, obviously. I know we we all hope for a resolution there, but you know, the the cost dynamics there are are better, I believe, than if you were to produce those vehicles in the US. Just curious in in, like, a worst case scenario situation where we're at this the current status quo and that continues prospectively, How do you think about the the Korean business? Is is the better economics there sufficient that you could continue working with the same kind of production, same capacity, or would you make changes there? And then I have a follow-up. Thanks.

Yeah. Tom, you know, we really have to see where this levels out. I mean, we've had the operation in Korea for a very, very long time. It's a very efficient operation. That we're very proud of, but we've got to evaluate when we have some certainty with what the tariff will be. So I'm not gonna speculate. Obviously, we've talked about it with the different choices that we have. But I'm not gonna speculate right now until we know where the the agreement between Korea and the United States lands. But it it's a it's a operation we've had for a long time that's very efficient and high quality. Again, as I mentioned, you know, right now, the vehicles that we produce there, they're in high demand. And they sell our contribution margin positive. So I think we're in a a a we're in the right place where we are right now until we get more certainty, and then we'll have more to say about it.

Got it. And then as you think about you know, outside the US, you know, China looks like it was maybe a surprise positively, your performance there, despite all the negativity we hear in the press with the domestics there. But then the flip side in Europe, you're hearing a lot of kinda negativity from large OEMs this week with all the competition there. How do you think about these two markets for GM? Is you know, is it is it better just to kinda hunker down and and stay, you know, more focused in the US where you guys are so dominant? Or do you see opportunities, especially with the EV side, you know, battery cost coming down in the future, presents a great opportunity for you guys to to kind of expand further in those two markets. Thanks.

Well, I think from a China perspective, now that, you know, we announced the restructuring last year and it's on track, very proud of the fact that the team has is gaining share. I think we're the only foreign OEM or foreign brands to be able to gain share positive equity income. And I think there's an opportunity You know, there's with what we know today from the geopolitical situation, the relationship between the two companies, countries, I think there's an opportunity for Cadillac and Buick to be strong there. You know, Buick has a rich history there and the brand means something to the Chinese consumer and Cadillac is viewed as as, you know, luxury and a great choice. I mean, one of the vehicles we have there is the GLA which has been a very, very successful product. And now that we have it out, from a new energy vehicle perspective, it's doing quite well. So I think with what we know today, we can have a smaller but strong business that can grow in China And I think that's something that we're gonna be continuing to focus on. I'm really proud of the team there. And then from a Europe perspective, I think there's a lot of changes that are happening in Europe right now from a regulatory perspective, from what's happening, you know, from a competition perspective, especially from the Chinese. I think over time that will settle out. We're we think we have an opportunity in that market. Very proud of the fact that the Lyric was named German luxury car of the year last year, first American brand ever receive that honor. So I think we have especially our EVs that can do very well in the European market. But I think there's some stabilization that has to happen of what are the what is the policy situation across Europe that will inform the next step we take. And then you didn't mention South America, and I think we have huge opportunity from a South America perspective. We have very strong brands there, very strong dealer base, and I think there's opportunity there as well as in the Middle East.

Got it. Thank you.

Thank you. Our last question will come from the line of Emmanuel Rosner with Wolfe Research. Your line is open.

Great. Thanks for taking my questions. Wanted to ask you about the share buyback program. So it's good to see GM back in the market buying some on the open market. Can you get give us any sense of you know, how much you're hoping or planning to buy in the in in the second half? I believe you still have $4 billion plus maybe on the on the authorization. So is the goal to complete that this year, or would it be an amount less than that?

So, Emmanuel, good morning. Thanks for thanks for the question. First of all, we never left the market. As you know, we were covering with the accelerated share repurchase in the second quarter. So that's been consistent. While we paused open market repurchases, we have said that we're back now, and we began repurchasing in early July. No comment specifically on how much we're going to do. We obviously wouldn't wouldn't telegraph that. But you're right, we had as of the end of quarter $4.3 billion remaining on that authorization. And as we've said, we're sticking with our free cash flow guide and you would expect that seasonally there's going to be more cash generation in the second half versus what we did according to that guide when you look at the midpoint. So I'll just leave it at that. But, you know, we're we're gonna maintain that consistent application of our capital allocation policy.

Okay. Great. And then second topic I was hoping to ask you, follow-up about is you know, a follow-up on your EV strategy as a result of some of these US regulation changes. I I appreciate all the efforts that you highlighted towards flexible manufacturing and the ability to really respond to consumer demand, Is there any also an opportunity or appetite at GM to try and reduce the overall capital intensity of the business. Obviously, your CapEx remains very, very you know, stable and steady. Just curious if with this, you know, lower EV market, predicted as well essentially easier rules to follow, If there is any appetite there to actually just say, well, maybe down the line at some point, we don't need to spend as much on a go forward basis. As an overall company.

Well, Emmanuel, I think, you know, from a capital perspective, you know, feel very comfortable with with where we are at the ten to eleven, and then we've announced that, you know, with the footprint changes that we we'll we'll go to ten to twelve over the next couple of years, but still very much in line with affordability and and and balanced capital allocation and capital levels that on an inflation adjusted basis are similar to what we did in 2018 with much better cash flow performance So when you look at EVs, I wouldn't say that we're gonna be spending significantly less. What I would say is the composition of the investment is changing where we have been out expanding the portfolio and and making sure that we can meet customers where they are Our capital is now focused on where can we structurally in our that we've made on the battery technology, and the teams are hard at work at at looking at other things such as aero and materials. So you know, I think there's a path there and and one that we feel very comfortable with.

Great. Thanks for the color.

Yeah. Thanks, Emmanuel.

Thank you. I'd now like to turn the call over to Mary Barra for her closing comments.

Thank you. And I want to thank everybody for your attention and for your questions. We really do appreciate the dialogue. But I hope you step back and see that we are well positioned for the future. We have a lot of momentum with customers as we adapt to the changing markets, trade and tax policy, and we are demonstrating leadership in ICE, EV's, software, AV, and other important technologies for the future of mobility. Underscores my belief that GM will emerge from this transition period even stronger financially and with clear momentum and that we will be uniquely differentiated from our competitors with strength of our ICE business, the strength of our EV business, and the progress that I know we're gonna be making from a technology perspective. So thanks, everybody. I hope you have a great day, and be safe.

Thank you. That concludes today's conference. Thank you for participating. You may disconnect at this time.