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Key Automotive Industry Updates
The U.S. administration is extending tariff relief as costs trend lower, with General Motors reducing its tariff cost estimate from $4.5 billion to between $3.5 billion and $4 billion. Ford has similarly halved its estimate from $2 billion to $1 billion. These changes come amidst fluctuating demand in the electric vehicle (EV) market, particularly as many consumers rushed to buy before the expiration of a $7,500 federal tax credit in September.
Tesla’s current valuation stands at $1.4 trillion, significantly exceeding that of General Motors and Ford combined, driven by potential in AI and robotics. It has a price-to-earnings ratio of 294. Meanwhile, Rivian reported a surprising gross profit of $24 million against expectations of a $38.6 million loss, while Lucid reported an adjusted loss of $2.65 per share, missing revenue expectations.
Despite challenges ahead for EV makers, the broader automotive industry is showing signs of resilience with both GM and Ford benefiting from lower-than-expected tariff costs.
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