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# GM Sees About $2 Billion Cost Headwind In 2026 And Roughly $2 Billion In 2027 If Prices Stay Put
- URL: https://www.bullished.co/gm-sees-about-2-billion-cost-headwind-in-2026-and-roughly-2-billion-in-2027-if-prices-stay-13c16bb7/
- Published: 2026-10-20T14:06:07.000Z
- Updated: 2026-10-23T12:52:36.000Z
- Description: CEO Mary Barra said GM has not yet had time to find offsets, and 2027 guidance will come after the fourth quarter.
- Author: Matteo Parrino
- Tags: Earnings, GM, Industry: Consumer Discretionary

[General Motors](https://www.bullished.co/tag/gm/) now expects commodity, logistics and memory-chip inflation to cost it around $2 billion in 2026, CFO Paul Jacobson said on the company's third-quarter earnings call Tuesday. Chair and CEO Mary Barra said the team "really haven't had time" to look for offsets because the increases came in "just the last couple months."

## What the executives said about costs

Jacobson said on the call that inflation is adding about $400 million of incremental cost this calendar year, most of it landing in the fourth quarter. Spot prices for hot-rolled steel and copper are each up 10% to 15% since July, he said, and about 50% versus last year's average.

Through the first nine months the headwind was roughly $1.3 billion, including about $700 million in the third quarter, mostly commodities.

For 2027, Jacobson said that simply annualizing the increase since July would add $1 billion to $1.5 billion of adjusted EBIT (earnings before interest and taxes) headwind, for a total of roughly $2 billion. He called it too early to predict where prices land.

GM shares were down about 5% at $78.39 in Tuesday trading.

## What it changes for 2027

The growth goal stands, with the same condition attached. Barra said 2027 should be better than 2026, assuming demand holds and cost pressures moderate. Asked by a Goldman Sachs analyst what moderation means, Jacobson said that at current prices it "makes that more challenging heading into next year." GM is looking for "a little bit of moderation," he said, and added: "I don't think anything has changed."

Barra pointed to warranty savings, lower EV losses, software and services growth, and fixed-cost cuts. "We obviously have work to do and we plan to do it," she said. She declined to quantify the fixed-cost savings now.

Volume will not help. Barra said GM expects to build roughly the same number of trucks in 2027 as in 2026 during the changeover to new Silverado and Sierra pickups, with added capacity in 2028\. Price and mix are the levers, she said.

GM also raised its 2026 free cash flow outlook to $11.5 billion to $12.5 billion from $9.5 billion to $11.5 billion, and narrowed adjusted EBIT to $14.5 billion to $15.5 billion from $14 billion to $16 billion. It announced a new $20 billion multi-year buyback authorization.

## What to watch

Barra said GM will have more to say when it gives full-year 2027 guidance at the end of the fourth quarter, when she said she could quantify the fixed-cost savings.

Until then, Barra's own summary of the offsets is the one on the record: warranty, EVs, software, fixed costs, and work still to do.

### More on General Motors

- [GM's 10-Q Adds A $4.5 Billion Bank-Funded Facility For Suppliers' Parts Stockpiles](https://www.bullished.co/gms-10-q-adds-a-4-5-billion-bank-funded-facility-for-suppliers-parts-stockpiles-bc1b3c13/)
- [GM Authorizes New $20 Billion Buyback After Finishing $6.0 Billion Program, Narrows 2026 Profit Range](https://www.bullished.co/gm-authorizes-new-20-billion-buyback-after-finishing-6-0-billion-program-narrows-2026-704ab40a/)

[All General Motors (GM) coverage →](https://www.bullished.co/tag/gm/)