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General Motors said on Tuesday it would take a $1.6 billion charge in the third quarter as it reshapes its electric vehicle strategy following the scrapping of a key federal incentive, a move likely to dampen demand. U.S. carmakers have delayed or canceled new EV models and battery plants and pared other investments, citing weaker-than-expected demand. The market faces further strain after the Trump administration removed a $7,500 federal tax credit for EVs, a key support for the industry. EV adoption rate to slow “Following recent U.S. Government policy changes, including the termination of certain consumer tax incentives for EV purchases and the reduction in the stringency of emissions regulations, we expect the adoption rate of EVs to slow,” GM said in a filing on Tuesday. Shares of the Detroit, Michigan-based automaker were down 2.5% in premarket trading. The stock has been up about 4.5% this year. Some auto industry executives, including Ford CEO Jim Farley, have warned that EV sales will drop significantly in the absence of the tax credit. However, some, including the CEO of Hyundai Motor North America, have said that the EV market remains resilient. Both GM and crosstown rival Ford had launched a program that would have allowed dealers to offer a $7,500 tax credit on EV leases after the federal subsidy expired, before walking back on those plans. The changes will not affect GM’s current portfolio of its Chevrolet, GMC, and Cadillac EVs that are in production. The Detroit automaker warned of the possibility of further charges as a result of the reassessment of its capacity and manufacturing footprint, which it said was still ongoing. The charges comprise a $1.2 billion non-cash impairment related to EV capacity adjustments and $400 million for contract-cancellation fees and commercial settlements. The charges will be recorded as adjustments to the automakers non-GAAP results for the third quarter scheduled for early next week. Utkarsh Shetti, Reuters
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E-Commerce
Wind and solar power have been under attack during Donald Trumps second term as president. He has called renewable energy a joke, canceled wind and solar projects, and taken actions to prop up coal and other fossil fuels as a way to secure the countrys energy independence. But the U.S. will struggle to have enough energy without wind and solarespecially as the tech sectors growing use of AI demands more poweraccording to Chuka Umunna, JPMorgan Chase & Cos global head of sustainable solutions, who spoke with Bloomberg Television on Tuesday. The comments came as JPMorgan announced an initiative to invest $1.5 trillion toward security and resilience that includes investments for solar, battery storage, nuclear, and efforts to modernize the energy grid. The Trump administration has expressed support for expanding geothermal as well as nuclear energy. But Umunna said those wont be enough to help the country meet its energy demands, and succeed when it comes to AIwe will still need wind and solar as well. Its difficult to conceive of a situation in which they wont need to tap into those sources of energy, he said. We need more energy from all sources. Nuclear in particular takes years to come on stream, Umunna noted. Projects take an average of seven years, though the U.S. Government Accountability Office says nuclear power plants take 10 to 12 years to plan, license, and build. It can also take up to seven years to build new gas-fired turbines. Wind and solar, in contrast, are among the fastest (and cheapest) new sources of energy to build, with many projects taking just 12 to 18 months. Trump has also pushed his fossil fuel energy agenda as a way for the country to solve its energy emergency and achieve energy independence. But according to Umunna, renewables will actually help the country be more self-sufficient. The debate about sustainability, and whether or not to deploy renewable energy, is no longer a binary, he said: It involves complex issues of geopolitics and [economic] competitiveness as well. When it comes to green economy stocks, which have seen strong recent gains, investors see an advantage not only from the sustainability angle, but also around sovereignty, the strategic autonomy thematic, he added. JPMorgan has identified 150 stocks that benefit from both. JPMorgans Security and Resiliency Initiative is a 10-year plan to finance industries it says are crucial to economic security. It will invest in four main buckets: supply chain and advanced manufacturing; defense and aerospace; energy independence and resilience; and frontier and strategic technologies (including AI and quantum computing).
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E-Commerce
Johnson & Johnson on Tuesday raised its 2025 sales forecast after reporting quarterly earnings that topped Wall Street expectations, and announced plans to spin off its orthopedics business into a standalone company. The healthcare conglomerate now expects product revenue of $93.5 billion to $93.9 billion, about $300 million higher than its prior forecast and above analysts’ expectations of $93.4 billion, according to LSEG data. Alongside the upbeat forecast, J&J said it plans to separate its orthopedics business into a standalone company named DePuy Synthes within the next 18 to 24 months, marking its second major spinoff since 2023. J&J’s orthopedics unit, which makes hip, knee, and shoulder implants, surgical instruments, and other products, generated around $9.2 billion last year, or about 10% of total revenue. J&J in 2023 announced a two-year restructuring program for its orthopedics business, saying it planned to exit certain markets and stop selling some products, after having recently spun off its $15 billion consumer unit into Kenvue. The company said it planned to focus on high-growth, high-margin areas as part of its separation plans, such as oncology, immunology, neuroscience, surgery, vision care, and cardiovascular. J&J Chief Financial Officer Joe Wolk said the company was exploring multiple paths for the separation, with a primary focus on a tax-free spin-off, but remained open to other options. While the orthopedics business was profitable, Wolk said J&J believes the next phase of innovation in orthopedics was “beyond our scope and probably in better hands somewhere else.” Shares of the New Jersey-based healthcare giant rose nearly 2% in premarket trading. FORECAST RAISE, PROFIT BEAT Third-quarter sales of $23.99 billion edged past Wall Street expectations of $23.75 billion, according to LSEG data. The drugs and medical device maker posted adjusted earnings of $2.80 per share versus analyst expectations of $2.76. The company’s pharmaceuticals sales jumped 6.8% from a year ago to $15.56 billion, slightly outpacing analysts’ estimates of $15.42 billion. J&J saw gains from its oncology products, including blood cancer treatment Darzalex, which brought in third-quarter sales of $3.67 billion, about in line with forecasts of $3.62 billion. Its medical device sales also rose 6.8% to $8.43 billion, mainly driven by electrophysiology products. Patrick Wingrove, Reuters
Category:
E-Commerce
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