Car manufacturers haven't exactly been a source of alpha this year, thanks to volatile auto tariffs, parts shortages, the end of EV tax credits, and a general malaise among U.S. consumers.
You might expect car company earnings to suffer in this environment.
But Q3 earnings results tell a different story.
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General Motors Co.
GM (NYSE:GM) reported its Q3 earnings last week and surprised analysts with the magnitude of its top and bottom-line beat. The company reported earnings per share (EPS) of $2.80, which surpassed expectations by more than 22%. Revenue also came in 8% above expectations, and executives raised full-year adjusted EPS guidance to a range of $9.75 to $10.50. The company also noted offsets that reduced its tariff burden more than analysts had projected. GM shares rocketed upward 15% following the news release.
Smashing expectations in Q3 sent the stock into the stratosphere, but sharp investors likely noticed momentum building since early summer. Once the worst of the Trump tariffs were lifted in April, GM shares began steadily regaining the momentum they had at the end of 2024. The stock traded above the 50-day and 200-day simple moving averages (SMAs) consistently through September, and it is now making new 18-month highs. One area of concern is the Relative Strength Index (RSI), which is flashing a bright Overbought signal. Fundamental and technical tailwinds are in place for GM, but the stock is up 30% over the last three months, and a brief pullback wouldn't be surprising at these levels.
Ford Motor Co.
Ford (NYSE:F) also reported Q3 earnings last week, posting its biggest top and bottom line beat since Q3 2023. EPS came in nearly 22% above projections at $0.45, and quarterly revenue topped $47 billion for the first time in the company's history. Reduced tariff headwinds were a major profit driver; the company's expected burden is now "only" $1 billion for the full 2025 fiscal year. Ford doesn't announce guidance, but this was the third consecutive double beat for the automaker and tariff headwinds continue to be expertly navigated.
Ford shares have been on an upward trajectory since April, but bullish momentum became plainly evident by the end of June when the 50-day SMA crossed the 200-day SMA to form a Golden Cross. Since this signal, the 50-day SMA has acted as a strong support level, but the Q3 earnings news could be a ‘blow off top' where investors begin to take profits. The stock is now up more than 30% YTD, including a 10% advance in the last 30 days alone. However, the outsized rally has triggered an RSI alert, which now reads Overbought. Like GM, the rally in F shares may be getting overextended.
Honda Motor Co.
Honda Motors (NYSE:HMC) has faced a wide range of tariff troubles in 2025. But now that Japan is out of the Trump administration's crosshairs, the company's consistent performance and affordable valuation have investors taking notice. During the company's fiscal Q1 2026 earnings release on August 6, executives raised full-year revenue guidance expectations on a pair of fundamental tailwinds: reduced tariff exposure and a strengthening yen. The stock still trades at just 11 times earnings and pays a 4.5% dividend yield, but shares are still basically flat over the last 12 months.
Is this the calm before a storm of upward momentum? HMC shares appeared to be on the verge of a breakout when a Golden Cross triggered a brief summer rally, but the bullish momentum fizzled by the end of September. The share price took out the 50-day SMA, but bounced off the 200-day SMA following an Oversold signal from the RSI. The 50-day SMA is now the area to watch; the stock will likely need to push above this level before a sustained rally can begin.
Toyota Motor Corp.
Another beneficiary of reduced tariffs on Japanese imports has been Toyota (NYSE:TM), which sold more than 11 million vehicles in fiscal 2025. Toyota and Lexus are two of the most popular brands in the United States, representing about 14% of total U.S. vehicle sales. That's a lot of revenue at risk from tariffs, which is why any reduction in import taxes is seen as a huge boon for the massive automaker. With the strictest tariffs reduced, Toyota has put together four straight months of U.S. production growth, including an 11% advance in September.
From a technical perspective, a breakout in TM shares appears imminent. Despite bearish MACD action, a Golden Cross occurred in September, creating a conflicting technical picture. However, the bullish momentum prevailed; the stock bounced off the 200-day SMA, then broke back above the 50-day SMA, setting a new 2025 high. The stock is now above $200 per share for the first time since April 2024, and now the MACD has joined in on the bullish signalling.
Stellantis N.V.
Europe-based Stellantis (NYSE:STLA) has been one of the biggest trade-war victims, due to the complex manufacturing process for its popular U.S. models like Jeep, Dodge, and Ram. Created through the merger of Chrysler and Fiat, Stellantis has a global reach, but its North American operations account for 26% of total sales, making the region paramount to the company's success. Thankfully, Americans are addicted to SUVs and trucks, and Stellantis this month announced that North American sales grew 6% YOY in Q3. Chrysler model sales grew 45% during the period, while Ram sales rose 26%.
Stellantis's stock has been one of the worst-performing auto manufacturers in 2025, down more than 16% YTD. However, now that sales growth has returned, so has bullish momentum. The 50-day SMA has been a tough resistance level for STLA to crack, but the price pushed through it in October, boosted by a bullish MACD crossover. The next obstacle for STLA shares will be a retest of support at the 200-day SMA; if this level holds, the bullish momentum should continue to swell.
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