Electric Vehicles And Battery Production Will Fuel Future Success

Analysts have lifted GM’s price target to $58.28 thanks to resilience in U.S. auto demand, effective cost management, easing EV regulations, and ongoing buybacks, though concerns linger over competition, potential loss of IRA benefits, and weaker 2025 outlook.

Analyst Commentary

• Bullish analysts highlight resilience in U.S. auto demand and production despite tariffs, with GM effectively offsetting cost pressures and maintaining strong consumer pricing.
• Easing U.S. electric vehicle regulations and strategic efforts to narrow EV losses position GM favorably, alongside an attractive valuation and ongoing stock buybacks.
• Bullish analysts expect GM’s upcoming new model launches and improved market position in EVs to drive incremental growth, with production relocation and logistics measures helping to soften tariff impacts.
• Trade policy changes, including the U.S.-Japan deal, present mixed implications: while bullish analysts see potential for further favorable trade agreements, bearish analysts note increased competition from Japanese automakers and persistent tariff disadvantages for GM exports from Korea, Canada, and Mexico.
• Bearish analysts express concern over a weaker outlook for the second half of 2025, lower vehicle volumes, tougher pricing comps post-new launches, loss of IRA benefits, and uncertainty around GM’s ability to sustain pricing and margins.

What's in the News

• Amazon is testing GM's BrightDrop electric vans as part of efforts to hit 100,000 electric delivery vehicles by 2030, intensifying competition with Rivian, Ford, Mercedes-Benz, and Stellantis (Bloomberg).
• GM will halt production of two electric Cadillac SUVs in Tennessee during December and cut output through mid-2026 due to weaker EV demand, making workforce adjustments as needed (Reuters).
• GM is renewing its driverless vehicle push by rehiring former Cruise employees, initially focusing on autonomous cars for personal use before pursuing full self-driving capabilities (Bloomberg).
• GM has signed multi-year fixed-price steel supply contracts with Cleveland-Cliffs, insulating against potential inflation amid ongoing tariff uncertainties (Bloomberg).
• GM will source batteries from China's CATL for its next-gen Bolt EVs for about two years until domestic manufacturing by LG Energy Solution ramps up, despite ongoing U.S.-China trade frictions (Wall Street Journal).

Valuation Changes

Summary of Valuation Changes for General Motors

• The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $57.20 to $58.28.
• The Consensus Revenue Growth forecasts for General Motors has risen slightly from -0.4% per annum to -0.4% per annum.
• The Future P/E for General Motors remained effectively unchanged, moving only marginally from 7.73x to 7.85x.