12:03 PM EDT, 09/24/2025 (MT Newswires) -- General Motors ( GM ) North America can restore its 8% to 10% margin target range as early as 2026 despite tariff headwinds, UBS Securities said in a note Wednesday.

The company had announced a 300 basis points impact on its margin target, but UBS said potential tariff relief from South Korea and Mexico, easing regulatory credit costs and a richer sales mix of full-size pickups and SUVs could drive margins back to a range of 8% to 10%. Additional fixed-cost savings and modest price increases are also expected to add to profitability, the firm added.

UBS said the regulatory backdrop could be a "positive catalyst" with a final emission ruling expected in late 2025 or early 2026 that would reduce the need to sell lower margin "compliance" vehicles.

Expanded full-size SUV capacity could add $1.5 billion to $2 billion in EBIT once fully scaled, the note said.

The brokerage added the company could potentially benefit from US rate cuts and capex cycles, while stronger free cash flow provides potential for capital returns. The company will likely repurchase about $4 billion of shares in 2026, according to the note.

UBS upgraded General Motors ( GM ) to buy from neutral, and raised its price target to $81 from $56.

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