Detroit is weird right now. If you listen to the headlines, you’d think the sky was falling on the "Big Three"—General Motors, Ford, and Stellantis. People love to talk about how they’re falling behind Tesla or getting crushed by Chinese brands like BYD. But when you look at the actual 2025 numbers that just rolled in this January, the reality is a lot messier and, frankly, more interesting than the "death of Detroit" narrative.
Honestly, 2026 is shaping up to be a year of the Great Pivot.
Last year, General Motors actually reclaimed the top spot in the U.S. market, moving about 2.85 million vehicles. Ford wasn't far behind, having its best year since 2019. But there's a catch. The "EV revolution" everyone promised? It hit a massive wall the second those federal tax credits expired last September. Now, the Big Three auto players are scrambling to rewrite their playbooks, and it's turning into a fight for survival that looks a lot like the old-school internal combustion days.
The EV Hangover and the Hybrid Surge
We’ve got to talk about the elephant in the room: EVs. For three years, Detroit poured billions into battery plants. Then, on September 30th, the $7,500 tax credit vanished. The result? Pure EV sales cratered. Ford’s electric sales plummeted over 50% in the final quarter of 2025.
But here’s what most people miss. While everyone was watching EVs fail, hybrids quietly became the industry's new gold mine.
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Ford moved over 228,000 hybrids last year. That’s a record for them. They’re basically realizing that Americans don’t want to be tethered to a charging station yet, but they do want to save a few bucks at the pump. Even Stellantis, which has been struggling lately, saw a massive 93% jump in Gladiator sales toward the end of the year.
It’s a weird middle ground.
- GM is leaning into its massive SUVs (think Tahoe and Suburban) to keep the lights on.
- Ford is betting the farm on the Maverick and the F-150 hybrid.
- Stellantis is actually killing off its plug-in hybrids (PHEVs) for the 2026 model year because customers found them too glitchy and expensive.
The Tariff War Nobody Is Ready For
If you think car prices are high now, wait. The Trump administration’s 25% tariff on finished cars—regardless of where they're made—is starting to bleed through. Ford’s CEO Jim Farley didn’t mince words recently, calling the situation "chaos." Ford took an $800 million hit from tariffs in just one quarter.
GM's CFO, Paul Jacobson, warned that the full-year impact could hit $5 billion. That is a staggering amount of money.
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Where does that money come from? Usually, your wallet. However, the Big Three auto giants are in a tight spot. They can’t just raise prices by 15% overnight because nobody would buy the cars. Instead, they’re cutting shifts. GM already slashed production in Ontario, and Stellantis has been idling plants in Windsor and Brampton. They’re trying to "adjust" their way out of a multi-billion dollar hole without scaring off the average buyer who's already struggling with 7% interest rates.
Why Stellantis Is the Wild Card
While GM and Ford are mostly holding steady, Stellantis is in the middle of a literal "fall from grace," as some analysts at Piper Sandler put it. Their U.S. sales were down 3% last year. If you’ve been to a Jeep dealer lately, you’ve probably seen the rows of unsold Grand Cherokees. Inventory levels for Jeep and Ram are sitting at 80+ days, while Toyota is sold out in 30.
They’ve had massive management turnover and even stopped production on some of their most iconic models to "reset." But don't count them out. They just formed a joint venture with a Chinese company called Leapmotor to try and bring cheaper tech into their European models. It’s a "if you can’t beat ‘em, join ‘em" strategy that has the rest of Detroit watching very closely.
The UAW Factor: 2026 Is the Next Big Test
Remember the "Stand Up" strikes? The massive raises the UAW won in 2023 are finally hitting the balance sheets in full force this year. Labor costs are up significantly, and the Big Three are trying to automate everything they can to offset it.
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We’re seeing a huge shift toward AI-driven development. Instead of taking five years to design a new truck, they’re using generative algorithms to do it in months. It sounds like sci-fi, but it’s the only way they can keep margins high enough to pay those new union wages.
Actionable Insights for the 2026 Car Market
If you’re looking at the Big Three auto brands right now, whether as a buyer or an investor, the landscape has changed. Here is how you should actually navigate it:
- Wait for the Inventory Glut: Jeep and Ram have some of the highest inventories in the country. If you're looking for a deal, that's where the "incentive" wars will start first. Avoid buying at MSRP right now.
- Watch the Hybrid Resale Value: Pure EVs are depreciating like a rock since the tax credits ended. Hybrids, however, are holding their value remarkably well. If you’re buying a Ford or GM vehicle this year, the hybrid version is likely the smarter long-term financial play.
- Monitor the 2026 "Small Car" Returns: Ford and GM are both hinting at a return to smaller, profitable vehicles because high prices are finally breaking the consumer. We’re likely to see a "race to the bottom" in pricing for entry-level models by late 2026.
- Diversify Away from Pure EV Exposure: If you’re an investor, the companies with a balanced "Multi-Power" strategy (gas, hybrid, and EV) are outperforming the EV-only players. GM's stock has consistently outpaced the S&P 500 because they didn't abandon gas engines too early.
The Big Three auto companies aren't dying; they're just finally admitting that the transition to a new era is going to take a lot longer—and cost a lot more—than they told Wall Street two years ago. It's a return to pragmatism, led by the humble hybrid and the high-margin pickup truck.