First quarter results are starting to roll in for American automakers, and General Motors is up first this morning with some good news. The company’s margins are good and people are still buying trucks. Even better, the company gets a nice big chunk of change back from the administration in the form of a tariff refund.
If you read The Morning Dump every day, as 2-out-of-10 doctors recommend, the story of the market continues to be that the buyers who can afford expensive nice, new vehicles don’t seem to be that bothered by high gas prices. At least not yet. That’s music to the ears of dealers. The persistent drumbeat of Carvana and CarMax coming for their customers, though, isn’t something dealers want to hear.
The big Chinese car show is ongoing and there’s a new list of five cars you could buy for the average price of an America car, which I think is a little misleading. That’s all heavy, so let’s end with a sweet Caterham.
A Bonus $500 Million Is Icing On The Cake For GM
When the Supreme Court struck down certain tariffs illegally enacted by the Trump administration, it didn’t impact most of the trade barriers that automakers (and, eventually, consumers) are facing. It did reverse some of them, though, and for GM that’s more cash on top of an otherwise good quarter, as CEO Mary Barra mentions in her latest shareholder letter:
In the first quarter of 2026, General Motors once again delivered strong financial performance, driven by our strategic product portfolio and disciplined execution by our teams, dealers, and suppliers.
Our EBIT-adjusted of $4.3 billion surpassed our expectations even after excluding a $500 million tariff adjustment following a recent U.S. Supreme Court decision. To reflect the flow-through of this adjustment, we are raising our full‑year EBIT‑adjusted guidance by $500 million, to a range of $13.5 billion to $15.5 billion.
We have solid momentum in our core operations: We maintained overall sales leadership in the U.S. and Canada. We led the U.S. industry in full-size pickup sales and share, with 42% of the market, and we were #1 in Fleet, including Commercial deliveries. In addition, we were #2 in EVs with growing market share, and #1 in Canada.
GM continues to be in decent shape, and may be even more profitable because of the drop in expensive, money-losing EV production. The market hasn’t reached the point where higher gas prices (which were up again to a peak yesterday) are stopping people from buying exactly the kind of large trucks that GM makes so well. The company also is spending less than the industry average on incentives.
Not everything is perfect. Buick is entirely reliant on imports, which means there’s a tariff cost to its most affordable models, which typically have thinner margins than full-size trucks and SUVs.
‘There’s A Whole New Generation Of People’ Who Have Only Done Digital Car Purchases, Warns Analyst
Both CarMax and Carvana represent serious competition for car dealerships as they’re rivals for both sales and inventory, and that’s before considering whatever Carvana is doing buying all of those Chrysler Dodge Jeep Ram rooftops.
A new survey from financial advisor group Stephens, Inc. shows that, unsurprisingly, dealers see both CarMax and Carvana as potential threats for the above reasons, but I think this comment from analyst Jeff Lick, via Car Dealership Guy, points out a longer term threat:
“If somebody shows up on the car lot, they’re there for a reason, and they’re willing to buy from a car lot. The bigger issue that some of the dealers have is that Carvana has created a whole complete process in your driveway system. So you may never see that person…There’s a whole new generation of people who might be 25 that all they’ve ever done is digital.”
I know plenty of people who have had good experiences with Carvana and never needed to walk into a dealership. Carmakers are working on a way to give this experience to customers, via dealers, but it’s possible there’s a generation that doesn’t like buying things in person and will extend that preference to cars as well.
The flipside of this is also a risk to dealers, as becoming so good at selling cars digitally makes it easier for automakers to reduce their dependence on them.
Here Are Five Cars You’d Probably Not Buy Instead Of Grand Highlander, That Would Also Be More Expensive If Ever Actually Sold In The United States
There’s a Reuters list today that’s being published in various outlets (you can read it without a subscription here at The Detroit News), and I don’t really love the framing of it, which is: “For the average price of one car in U.S., you could buy 5 new Chinese EVs.”
Well, no, you couldn’t. Not unless you live in China. In fairness, Reuters does say this in the piece:
Reuters compiled a list of the five best-selling electric vehicles in China that start under $12,000 using DCar data.
These small EVs aren’t available for sale in American showrooms – and may never be – but for about the price of an average new car in the U.S., a consumer in China could buy all five of these EVs.
If you can look past the tariff barriers, there’s also the reality that most Americans don’t want something this small. Some people do, and I’m extremely pro bringing back smaller, more affordable cars like the Honda Fit.
I think the biggest issue is that this article (and videos from influencers) gives people the impression that this is what these cars would cost if they came to the United States. China has provided a lot of incentives to Chinese automakers and there are too many in the market, leading to a brutal price war there.
A good data point is the BYD Seagull/Dolphin Mini, which is noted as having a starting price of $10,200. The Seagull is a great story and a well-packaged vehicle at a low price, but we can see what it costs to make it acceptable to a market similar to ours. The cost of the European-ized Segaull, which we drove last year, went from $10,000 to $26,000. In Mexico, it’s about $24,000.
When comparing apples to apples, it’s probably fairer to say you could buy two of these small cars for the price of one average car. At the same time, you could also get two Nissan Sentras or maybe even a pair of Traxes for the same price.
Check Out This Cool Miami-Themed Caterham
Fortunately for you, I’ve known the press people for the newly reinvigorated Caterham for decades now, so I get all the releases from the British carmaker. Fortunately for them, I’m a sucker for these cars, having last driven one on Hwy 33 in California.
There’s a new “Miami-themed one” that reflects the nearby GP circuit:
Motorsport fans attending the race will have the opportunity to see this lightweight, track-focused special edition from Caterham for the first time on Friday 1st May on Race Street, located in the West Campus of the Miami International Autodrome
The vehicle will be finished in a bespoke Aqua custom paint with a unique Miami Special Edition decal pack in Vibrant Pink and White. To finish the exterior design, the iconic Miami script and silhouette of the circuit features on the rear of the car.
The bespoke aesthetics continue throughout the interior with the Miami script embroidered on the headrests, and an individual numbered plaque located on the dashboard. The hand-built nature of a Caterham Seven means the cars also feature a second plaque in the engine bay, engraved with the names and signatures of the two builders who were responsible for hand assembling the car at the factory in the UK.
The company seems to be going out of its way to not say “Formula 1” as I’m guessing there’s no F1 deal. It’s fine, everyone knows what they mean. As with other Sevens, you get the 2.0-liter Ford Duratec, which is good for 210 horsepower and a run up to 60 mph in 3.8 seconds. If you’ve never tried it, 60 mph in a Seven feels like 300 mph in whatever you drove to work this morning.
Also, you get a free Cuban sandwich. That’s not in the press release. I’m just assuming.
What I’m Listening To While Writing TMD
That’s right, y’all, it’s “Brick House” by The Commodores.
The Big Question
What would you do with a $500 million refund?
Top graphic images: GM
Both of those come with the cost of fuel. If you were a household like mine, where one of those cars would be coming in purely as a local commuter, I’d take the vehicle I can run for $15/mo. worth of electricity.
Cause at that end of the market, ALL of the costs have to be factored in. The lack of fueling, oil changes, longer brake intervals, all play into a much more cost-effective choice.
I suspect lots of folks on the lower end of the market have nowhere to charge. We don’t where I live and we’re all over the place income wise.
Definitely a problem, but one that is changing slowly.
Meanwhile the NYT reports :
Gasoline prices in the United States rose on Tuesday to their highest level in four years as peace talks between the United States and Iran appeared at an impasse.
The average cost for a gallon of regular gasoline is $4.18, according to the AAA motor club. The price at the pump has not been that high since April 2022, shortly after Russia invaded Ukraine. Tuesday’s jump of 1.6 percent was the highest percentage increase in more than a month.
If I personally had $500M, not as a corporation getting a refund. I would spend the rest of my life traveling the world.
With 500 mil I’d build a larger nicer workshop behind my house, lifts, insulated, heated, lots of machining/fabrication equipment. Then I would spend my days building dumb stuff. Maybe I would try to buy up some additional land around me then leave it undeveloped,perhaps with some trails or something through it.
$500 mil? I’d buy more land around me, finish out my barn, then have someone else do all my maintenance and projects. Like LS swapping my c4.
I’d still grow my own tomatoes and peppers, though.
$500M? 3M would not only pay off all debt, but also achieve all basic life dreams. I could build the shop I want, build a stable, take care of my parents, etc.
The rest? I would start by buying up all the empty fields in the small town I live in that go up for sale and then leasing them cheaply to anyone wanting to work the land. If no one wants to work it, then I would just hay those fields. Keep them functional, but also keep developers from buying them and building more gigantic vacation homes that most folks around me don’t want.
Probably invest a good chunk as well. If I can net 8% average per year on $200M, thats gonna do me great.
I think the typical calculation is you can spend 4% of an investment (trust) each year and not have to reduce the principle and also beat inflation. So that $200M should net you $8M every year until its time to pay estate tax. I could get by just fine on $8M a year.
Close, but not exactly. A 4% withdrawal rate has meant you would not run out of money in any 30 year period in history, not that you would necessarily never touch your principle (although in many cases you would end up with more than you started with). 3 or 3.5% is generally considered safer over longer timeframes.
Further reading for my fellow finance nerds: https://www.investopedia.com/terms/f/four-percent-rule.asp
Dammit! you mean I can only live on $5M per year? How am I gonna manage that! I NEED that $8M 😀
Private jets don’t grow on trees, after all. 😀
Revert a good portion of the land back to a biodiverse natural ecosystem too. Helps the farms as a bonus.
My Seven clone doesn’t have a windscreen, but makes up for it with 150 additional horsepowers. Feels like time travel.
Any chance that GM will be refunding consumers that bought higher priced vehicle due to the tariffs, I suspect people would be pleased to get a check back for a couple of grand or whatever. That way they can more easily afford to put gas in their new trucks…
Your adorable.
No you’re adorable. I’m a pedant.
No, you’re a comma shy. I’M a pedant!
What’s with all this talk of adorable pendants? Is it cause Mother’s Day is coming?
I’m from the UK, Mother’s day has already passed. It isn’t actually for ‘your’ mother. Well it wasn’t, it has morphed into that.
From Google.
Mother’s Day in the UK (Mothering Sunday) 2026 is on Sunday, 15 March 2026. As a traditional religious holiday celebrated on the fourth Sunday of Lent, this date falls three weeks before Easter Sunday. It is an annual occasion to celebrate maternal bonds with cards, gifts, and family gatherings. [1, 2, 3, 4, 5, 6]
Key Details for Mother’s Day 2026:
Unlike the United States, which celebrates Mother’s Day on the second Sunday in May, the UK date changes annually based on the lunar calendar. [1]
Impressive sourcing!
This might be a double reply as the first one vanished.
I’m from the UK, Mother’s Day has already passed. It’s also not technically for ‘your’ mother, it’s for the Church. Not to say it hasn’t morphed into it being for ‘your’ Mum in the UK or ‘all’ Mom’s in the USA.
From Google.
Mother’s Day in the UK (Mothering Sunday) 2026 is on Sunday, 15 March 2026. As a traditional religious holiday celebrated on the fourth Sunday of Lent, this date falls three weeks before Easter Sunday. It is an annual occasion to celebrate maternal bonds with cards, gifts, and family gatherings.
Key Details for Mother’s Day 2026:
Date: Sunday, March 15, 2026.Significance: Historically known as Mothering Sunday, the day stems from a 16th-century tradition where people returned to their “mother church”.Activities: Common traditions include church attendance, family meals, giving cards, flowers, and gifts.Unlike the United States, which celebrates Mother’s Day on the second Sunday in May, the UK date changes annually based on the lunar calendar.
Ah, I’m Canadian, and apparently we adopted the US celebration (according to wiki)
Either way, Hallmark gets another chunk of change.
We do home made cards and gifts, because screw capitalism! Also, screw the church. I left them behind decades ago.
If you change your Siri voice to an Australian accent it will think it is Australian and give you the wrong dates for holidays … I missed Mother’s day once that way but my wife didn’t believe me.
I’m glad I don’t use those types of services, then.
Yep, I get British holidays, since I use the British voice. Reminds me of an old girlfriend…I messed up that one.
Why is that M in I’m capitalized?
For EMPHASIS, dammit!
Fine: “I’m.”
Dammit.
It stands for Mondial
Mr Worldwide, here. (or, should I say, Monsieur Mondail)
I thought that was Adrian?
Brexiteers would have conniptions for using French; I think he should adopt the title.
At first I was annoyed at myself for missing the comma, however, seeing the replies it’s generated, I’m glad I did.
Thanks for the clarification.
What I was going to say. Also my conspiracy on this is these tariffs were just a way to inflate prices knowing that these companies would get a refund but these already inflated prices will stay and just create a bigger divided between the working class and the rich.
There’s definitely some truth in what you said.
Keeping us divided is better for them, as we are focusing on ripping each other apart, not looking at what our government overlords are doing. Anyone want to open a daycare or hospice?
Listen to “If I had a million dollars” by the Barenaked Ladies 500 times to figure what to do with the money
Buy up all remaining nice Reliant automobiles?
If I had 500 million dollars
Well, I’d buy all my Autopian friends a K-car
A nice reliant automobile
Haven’t you always wanted a monkey?
… and Dejon ketchups.
Pa off mine, my mom’s, my girlfriend’s, and her mom’s bills. Buy myself a fun new car and then make sure no animal rescue ever had to beg for cash ever again.
I’m 58 and would probably do just fine with 1mil after the bills are paid.
Counterpoint – malls are starting to see a resurgence, precisely because the young un’s are tired of doing everything digitally. https://www.usatoday.com/story/money/2026/03/26/gen-z-retail-shopping-malls-resurgence/89233505007/
My 18 yo goes to malls all the time.
Mine does it also. But of course the mall is now an apartment complex.
We are about equal distance from two. One is fancier and the other is closer to her boyfriend
I feel like this plays more into the lack of 3rd spaces for kids to exist more than it does into shopping patterns.
What are “malls?”
–my teenagers, probably
“A mall? What do you think this is, Boise, Idaho?”
Teen Takeover!!!!
Curious to see the Carvana outcome. They bought a dealer a town away from me and all of the stock new and used disappeared pretty fast. A couple of security vehicles hanging out was about it in the main lot. I know someone who worked at the Stellantis dealer as a lead mechanic. I haven’t had a chance to talk to him recently, but I know he went to AZ for “training”
Since GM (and other manufacturers) track individual purchasers for warranty and recall purposes, it would take very little effort to determine those purchases affected by tariffs, assign a tariff fee if it doesn’t already exist, and send refund checks to the owners. Ha! Who am I kidding! They will make up more excuses than a fart in church on how they can’t do it.
If I had $500 million, I’d start a microcar company. I’d sell them as 3-wheeled vehicles to get around regulations. The base model would be an unmotorized velomobile, the top-tier model an AWD race car, with a street-legal 750W/28 mph class 3 ebike and an e-moto version in-between those two extremes, all sharing the same platform and parts to keep per-unit costs down and allow the owner to upgrade it as they see fit over time.
You could buy your kid the unmotorized “bicycle” version at a young age, and they could even turn it into their first car as they near adulthood.
“What would you do with a $500 million refund?”
Like others here, I’d use it so I would do the stuff I want to do and less of the stuff I don’t want to do.
As a starting point, get some house renos done, keep some money aside for my kids to help with schooling and post-schooling stuff and a bunch of little things.
The bulk of the money would be invested in relatively safe/stable investments that generate income. Even if I only make 5% interest/yield, that’s $25 million per year of income… which is plenty to live on while also having plenty left to help those around me.
Now let’s get back to reality… that $500 million will most likely go into GM’s coffers and help line the pockets of upper level execs and board members who don’t really need the extra money… but they’ll get it because they want it… and they call the shots.
And some of that $500 million will go to lobbyists who continue to lobby against BEVs and the ZEV mandates.
And some of the money will be for making political donations to the Trump and the Republicans in spite of the fact that both are bad for GM and the auto industry.
Tbq:
Step 1: pay off mortgage.
Step 2: renovations, including new garage roof, house wiring, converting back porch into carport, and HVAC.
Step 3: full professional restomod on The Bug.
Step 4: trade FR-S for GR86
Step 5: put everything else into the 401k and retire at 40.
Step 6. Pay the taxes. Oh wait. Your a half a billionaire. Nevermind. No taxes for you.
NoNoNo, I live in a blue state, the taxes are coming whether I like it or not. I guess I could offset it by making large contributions to the local museums and NPR/PBS stations.
To be fair, its already qualified as a Refund. So any taxes are already taken care of according the question being asked.
From the Carvana story
So you may never see that person
This is the key part of the new model. The mask is off, young people recognize that most sales interactions involve someone trying to steal as much of your money as possible, and you have to exert effort to fight back (see also the crime that is dynamic pricing). Few people enjoy that experience.
Anything that can be done to reduce the feeling or remorse from a perceived theft will improve buyer experiences and increase the number of eyeballs on your product.
The thing about dynamic pricing though is that it is very hard, expensive, and rare in physical stores; and very easy, cheap, and abundant online.
Here is an interesting idea that I will not pursue so I hope someone else does: Vibe code an AI program that can detect and spoof dynamic pricing rigs and present a persona to the dynamic pricer that will result in getting the lowest price the system offers.
Dynamic pricing is the digital equivalent of the 4-box.
$500 million refund? I’d stop working and actually do things I’d prefer to be doing. Fix up my house but not move. Pay off some debt of those closest to me. Get more involved with my kids activities. You know, enjoy life.
You probably mean as someone who runs GM though so what I’d do is cut every customer who bought a new vehicle from us during these stupid as fuck tariffs a check for at least for however much the difference was.
Bring back Voltec you cowards (GM).
With their embedded Google Automotive OS, the car could know when is about to exit the highway ahead of time and charge the battery enough for the remaining of the drive in Electric mode.
$500 million? Leave the rat race, build my dream house (Not a mansion), and a huge garage to stock with cars. Said garage bays would be larger than the crap my current house has to I could open my car doors withing dinging the one squeezed in next to it.
If I were GM, I’d probably invest it in additional quality control for my new line of V8s and full size trucks/SUVs coming out soon, considering those are existential stakes for the company.
If it were me personally, I don’t know, maybe buy some more cars?
As I am bad at capitalism, I would not use the $500M to pay executive salaries, dividends or any other of those things. Probably raise wages of the people who actually work for a living and focus on improving quality.
Will be interesting legal discussion with regards to the tariff refunds if/when companies from outside of the USA start to demand money either of the US Gov’t, or domestic US companies that passed on tariff charges to their exported product.
Tesla really lost their lead in Canada?
Who could guess that a CEO wading into the current toxic divisive political swamp wasn’t a good look, afterall.
Nintendo sued the US government a couple of weeks ago over tariff payment recovery.
Good.
Pizza party
That’s gonna be some amazing pizza.
Well, it might cover every single GM plant and office building around the USA
A battleship full of shrimp!
Isn’t that already called the “Trump Class Battleship”?
It’s super cool that many (not all) companies raised prices due to tariffs, will likely keep their prices high(er), and then will get refunds based on the tariffs that caused the prices to be raised in the first place. While us consumers get…nothing. 🙂
You get to enjoy that higher pricepoint to which you’re now accustomed.
Count your blessings.
It’s been true with lumber for far longer that price only creeps up for end-consumers with the addition of tariffs.
Frito-Lay jacked up prices and shrinkflationed their product in the post covid inflation storm, then took it in the shorts and had to cut prices by up to 15% recently to lure customers back. Apparently it worked but I won’t buy their chips any more. The small gathering size (formerly party size) are still nearing $6. Healthier living through demand destruction.
I think this is maybe the first example of the folks who always thought they could play Trump to their advantage actually succeeding. Trump has forever been an advocate of protectionist tariffs. It’s maybe one of the only things he truly believes in. And the advisors went ahead and encouraged him to go crazy with a plan that everyone with 3 brain cells knew was going to be illegal. Add a compliant judiciary that refused an emergency injunction (no permanent harm—easy to undo they said) and you have another gov sponsored transfer of wealth, just like the “loans” in the first term.