After allowing Tesla (TSLA) to dominate the electronic vehicle (EV) market for the past decade – one of the Detroit big boys has decided they’re going to try and muscle in on Elon Musk – as General Motors (GM) just announced that it will be going ALL electric by 2040.
Is this a good thing?
Will the competition breathe new life into the auto industry?
Or will this move turn American car buyers off?
There are a lot of ways this thing can go…
So let’s take a look at a few scenarios, shall we?
With everything that’s been going on in the markets over the past week with the whole Reddit short squeezes on hedge funds…
People have missed a lot of news that would generally have turned a lot of heads.
The news that GM will be going all electric over the next 15-20 years us BEYOND blockbuster news – yet this announcement has barely made a blip on the market’s radar.
Maybe it’ll take a few days to sink in…
Or maybe when the whole Gamestop (GME) Reddit push story has faded – people are going to remember that one of the major auto companies just dropped a bombshell on its industry, the markets and the country as a whole.
Shifting away from gas-powered vehicles was inevitable…
Sure, we understand that there would be an adjustment period – but the fact remains – the attitude toward fossil fuels has changed dramatically over the past 40 years – and to have not seen this evolution coming would have been very shortsighted.
However, just like with all things in life, it comes down to timing.
Is this the right time to make the move away from combustion engines?
Or is GM bowing to the social pressures of a politically-charged atmosphere where being “woke” often gets you paid?
It’s hard to tell.
To be honest, it seems a bit… forced.
As a consumer and a car enthusiast – I love watching the evolution of the auto industry…
But as an investor, I’d rather see the market make the decision than have the decision made from emotions – and I’ve got to say – this decision sounds more emotional than market savvy.
Don’t get me wrong…
I thought this move was coming – however the EV market doesn’t have the support you’d like to see to for a company the size and history of GM to make a move like this.
EV sales still account for less than 1% of all cars sold…
That’s not a lot.
And while the big boys of the industry seem to be floundering – the fact remains that gas-powered vehicles are still king.
However, while these former kings watch their stock dwindle in value, they also see Tesla soaring to new heights on an almost daily basis.
They see Elon Musk becoming the richest man in the world and wonder why they’re still living in 8 bedroom mansions instead 18 bedrooms…
So, they want to play catchup as I believe they think the reason for Tesla’s success is the car – instead of the man who created it and a bunch of other successful ventures – which I think is a huge mistake on their part.
General Motors CEO, Mary Barra, says the move was part of the company’s strategy to cut into Tesla’s domination of the EV market and to change the company’s image of the American muscle car-creating machine it used to be.
She said, “General Motors is joining governments and companies around the globe working to establish a safer, greener and better world. We encourage others to follow suit and make a significant impact on our industry and on the economy as a whole.”
Not that the Gorilla doesn’t want a cleaner environment – but the timing has to be right…
And I don’t think the timing is right for GM to do this.
How do I know this? Because when the rumors started swirling last week that this move was coming – the stock dipped.
There is very little excitement behind this – and that’s not good for GM.
Either way, stay tuned, folks…
The future of GM is going to play out before us – and it’ll be interesting to see whether it brings them into the 21st Century – or is the proverbial nail in its coffin.
Regardless, GorillaTrades subscribers will be some of the first to know if that changes…
And we’d love for you to be there and get the opportunity to profit with them – so that’s why I’m asking you to become a subscriber today.
However, I get that some investors like to blaze their own trail – and I admire that – but if you ever feel like you want a little extra boost in your trading…
GorillaTrades is always here for you.
We want to wish GM good luck!
A rising tide lifts all ships and we sure wouldn’t mind seeing the horizon from a higher vantage point.
“I think that cars today are almost the exact equivalent of the great Gothic cathedrals: I mean the supreme creation of an era, conceived with passion by unknown artists, and consumed in image if not in usage by a whole population which appropriates them as a purely magical object.” — Roland Barthes