Tariffs weigh on GM profits; Office attendance hits new high; Consumer credit access improves

Trade tariffs sliced about $1.1 billion from General Motors' profits for its latest quarter, and the toll could go as high as $5 billion for the full year, executives of the largest U.S. automaker said Tuesday. Detroit-based GM reported second quarter revenue of $47 billion and net income of $1.9 billion.

Overall numbers beat analysts’ expectations, though profits declined about 35% from a year earlier. On a conference call with analysts, company leaders said GM is taking steps to reduce its exposure to recently imposed tariffs that included 25% levies on imported vehicles and auto parts, and others affecting materials such as steel and aluminum.

Responses include GM’s June announcement of plans to invest $4 billion in its U.S. assembly plants through 2027, adding 300,000 units of capacity for high-margin pickup trucks, SUVs and crossover vehicles.

“This will help us satisfy unmet customer demand, greatly reduce our tariff exposure, and capture upside opportunities as we launch new models,” CEO Mary Barra said in a letter to shareholders Tuesday. “The capacity begins coming online in just 18 months, after which we project building more than 2 million vehicles in the U.S. each year as we scale.”

Data firm Cox Automotive said Tuesday that U.S. retail sales of new and used vehicles are rising so far in July from the month-earlier pace, “signaling renewed consumer momentum” aided by auto loan rates easing from 25-year highs. Government data showed June auto sales rising 1.2% from the prior month, topping the 0.6% increase for all U.S. retail sales. 

Office traffic rebounded strongly from a summer lull, with average attendance for 10 tracked U.S. regions reaching a new peak of 54.9% of the pre-pandemic level for the week ended July 16, well above the 49.4% average for the prior week, according to the latest Kastle Systems data.

The prior high in five years of tracking was 54.5%, reached in the week ended March 5, based on anonymous keycard data from the security technology firm’s office property clients. With the exception of holiday weeks, average weekly attendance has consistently posted above 51% this year as employers ratchet up in-office work requirements.

The latest numbers showed Texas cities again leading for attendance, with Austin at 66.6% and Dallas at 61%. Houston tied with Chicago at 60.6%, followed by New York at 55.9% and Washington, D.C., at 53.4%. 

Consumers’ access to auto loans, mortgage refinancing and other types of credit showed signs of easing in June after several months of tightening by lenders, according to the latest national survey from the Federal Reserve Bank of New York.

Based on data compiled every four months, the regional Fed said the average rejection rate for auto loans was 6.7% in June, down from 14% in February. The rejection rate for home mortgage refinancings was 14.6% in June, dropping sharply from 41.8% in February.

Fed researchers said the share of survey respondents reporting they did not apply for any credit, because they doubted they would be approved, was at 7.2% in June, down from a peak of 8.5% in February but still well above the June 2024 level of 5.5%. There were slight gains in average likelihood of applying for a new credit card, auto loan, new mortgage or mortgage refinancing over the next 12 months, as interest rates remained elevated by historical standards.