(Reuters) – General Motors (GM) will take a charge of $1.6 billion (1.38 billion euros) in the third quarter linked to the reorientation of its electric vehicle (EV) projects and weakening demand after the expiration of key financial aid in the United States, the American manufacturer said on Tuesday.
“As a result of recent U.S. government policy changes, including ending certain consumer tax incentives for EV purchases and reducing the stringency of emissions regulations, we expect the rate of EV adoption to slow,” GM said in a statement Tuesday.
US President Donald Trump notably removed the key support for the auto industry from the $7,500 federal tax credit granted for EVs.
The charges include a $1.2 billion non-cash writedown related to EV capacity adjustments and $400 million for contract cancellation fees and trade settlements.
In New York, GM shares fell 2.5% in pre-market trading.
(Writing by Utkarsh Shetti in Bangalore; Augustin Turpin, edited by Kate Entringer)
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