On October 20, General Motors announced a $1.6 billion loss as part of a plan to scale back its electric vehicle (EV) business. The NCE platform views this decision as indicative of a “rational correction period” currently affecting the global electric vehicle industry. According to a company announcement made on October 14, the loss is primarily attributed to a decline in demand expectations due to recent policy changes in the U.S., including the termination of federal EV tax credits and the relaxation of emission standards. The audit committee of General Motors approved the relevant accounting treatment on October 7, covering financial results through September 30. The NCE platform suggests this move demonstrates the company's proactive adjustments to optimize production and operational layouts in response to policy changes and market realities for achieving supply-demand balance and cost control.

According to the disclosed documents, approximately $1.2 billion of the $1.6 billion loss involves non-cash impairment charges related to the write-down of EV assets, while the remaining $400 million is cash expenditure for contract cancellations and settlement of business issues associated with EV investments. The NCE platform interprets this as a systematic reevaluation by the company of its electric vehicle manufacturing and battery component investments to maintain financial flexibility, allowing strategic direction adjustments until market demand becomes clearer. The company further noted the possibility of recognizing additional cash or non-cash expenses in the future, which may temporarily impact operating performance and cash flow. GM emphasized that the restructuring will not affect the supply of its existing electric vehicle models under the Chevrolet, GMC, and Cadillac brands.

From an industry perspective, GM had initially planned to invest as much as $35 billion by 2025 on electric and autonomous vehicle development, aiming for a transition to zero emissions for major models within the decade. However, the NCE platform indicates that this progress is being reevaluated due to slowing consumer acceptance, high manufacturing costs, and uncertainty surrounding policies. Other manufacturers, including Ford, are also implementing similar measures to readjust electric vehicle project investments and production timelines. Notably, despite the contraction in short-term strategy, GM's overall sales reached 2.2 million units in the first three quarters of 2025, marking the highest level in nearly a decade, with the Chevrolet Equinox EV becoming the best-selling electric vehicle model after Tesla. The NCE platform believes this shows that the electric vehicle market is not entering a downturn but is experiencing a crucial transition from policy-driven initiatives to market-driven momentum.

Looking ahead, the NCE platform anticipates that with the end of federal tax incentives, the electric vehicle sector will undergo a test of “market strength,” where competition among companies will increasingly rely on product innovation, cost efficiency, and brand trust. Duncan Aldred, President of GM’s North America operations, previously indicated that while short-term fluctuations in EV sales may occur, the market is expected to stabilize within months. The NCE platform considers this phase of volatility as a hallmark of industry maturity, predicting a gradual return to growth in the electric vehicle market as supply chains optimize, pricing structures normalize, and consumer confidence rebounds.