Will GM Go Bankrupt Transitioning to EVs (Electric Vehicles)?

GM are making big noises in the EV game, with high ambitions, and have set big objectives. They have big plans in the electric vehicle industry. With an electric Hummer coming out soon, and lot of other models in the pipeline like the Cadillac Lyriq.

GM have been making EVs longer than most of the other legacy ICE autos, with their Chevrolet Bolt, which is the biggest selling EV that is not a Tesla. So with all that experience they have, do they have a chance of making it to transition to EVs?

We will explore what it will take for GM to successfully transition, and see if they can make, or if they will go bankrupt yet again. GM was once the world's largest auto maker, but it looks like they struggle to stay around much longer. EVs are clearly the future of automotive, but it doesnt seem to be in GM wheel house yet.

Aside from the not overly successful Bolt, GM really have very little to show in their range of electric vehicles, and nothing at all that comes remotely to anything Tesla offers.

It's going to be a tough ride for GM over the next few years, it will be exceedingly tough for them to stay solvent. And that is if the market stays strong. In a market downturn, then they have even less chance of survival.

But perhaps Uncle Sam will bail them out again. Or maybe the government will try and keep them going by helping out with tax credits to help them transition to EVs without going bankrupt. We will explore all this and more.

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This video is meant for entertainment purposes, not Tesla stock investment advice.

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[danielguillaume]

No company should get bailed out unless the CEO gets let go without any exit packages. If the taxpayers have to pay the head of the company has to pay.

[billtruttschel]

Don't forget that GM (and others) have the dealership problem. Dealers want their cut too. Customers are learning there is a better buying experience in Tesla.

[superfly]

It cracked me up when GM’s CEO dumped $25 millions of her GM stocks after it was pumped by CNBS, lol. These damn fools who investing in GM didn’t realize the debt of this company?

[prusikpeakdesign]

I enjoyed your video and agree with your analysis. The market IMO is grossly overestimating the ability of domestic ICE companies to profitability transition into the EV space.

[billymania]

I agree. It's hard to see how GM, Ford make it to the EV side cleanly. I predict bailouts.

[fredbloggs]

It sounds like GM are adopting the strategy against Tesla that was originally used against Ford a hundred years ago.

They think offering variety will beat the monotony of Tesla.

The problem they have is when Robotaxis come along because nobody cares what a taxi looks like.

In fact for taxis, people actually prefer them to all be the same.

[jlg]

I am not selling any Tesla stock. Any profits will be taxed and that could potentially be used to bailout legacy auto. #Notonecenttothem.

[andyonions]

I'm sure it's 30 new vehicles, not models...

[korswe]

GM needs all the help it can get. I do worry about Toyota more as Toyota is the most indebted auto company in the world. They need to at least maintain their current sales or their interest charges will harpoon them.

[dr-k]

NO Bailouts! That is what I want, it is high time everyone shows if they can swim, or they should SINK! Sandy Munro said the EV will be the dominant car by 2028... they were laughing at him when he said that over a year ago. He who laughs last, laughs best.

[chrisheath]

Apparently the Environment Minister (Allegra Stratton) in the UK is saying that EVs are not for her, and she's sticking with a 10 year old Golf.
That's a politician for you. They are still bailing out Buggy Whip companies in the UK...

[yggdrasil]

The irony is, GM could have completely dominated the EV sphere if they hadn't canned the EV1.

[leegumprecht]

I hope GM, Ford, and Fiat Chrysler all survive. The race is not between these companies and Tesla.It i's between the US and China

[WillNGo]

Keep in mind: It's more likely that the longer something has existed, the longer it is likely to exist. What did interactive CD-Roms do to book sales and which one is still around? So GM, Ford and Silantis (Chrysler et al) being 100 years old are likely to survive. I don't think their survival or disappearance would affect Tesla one way or the other. Secondly, it's easier to retool an ICE factory than it is to build a new business from the ground up. (Tesla did it! Amazing as it was unusual. And they could eventually make all the factories needed to supply the U.S. market demand for new vehicles.) These old companies have the organization and scale, so I think the odds are that they will convert to EVs and survive, and in 5-10 years the pressure they felt from Tesla will have been good for them. Sandy Munro says that they don't even need the Tesla prod - Europe (and China) are going EV so fast if they wait they're dead. (In the end Tesla will have been the best thing to happen for these sclerotic companies. Tesla kicked them in the pants, the Chinese and Europeans might've completely replaced them by the time they noticed.)
But then I also know that I'll be wrong about some things. My projections for Tesla, 10x in 5 years (not unusual or an outlier) may only be 8-9x but could be 15x. And will GM, Ford, Toyota, VW survive? I might be wrong; Tesla might simply be too far ahead, too efficient, make too much profit and have self-driving cars.
What's going to happen if you can buy a one or two week subscription of FSD? Everyone will want that option on their car just for long family trips. Maybe Tesla makes only $100/year from these people - but makes a $4000 profit selling them the EV that can do it.
So maybe I'm wrong about GM surviving. Maybe they won't survive. From the POV of the United States they employ a lot of people, one reason why they were bailed out. But the U.S. Government ended up losing $11.2 billion on the deal- so they're not likely to get bailed out again. (Even Trump was angry about it.) Chrysler got bailed out twice (1980 and 2008) and both times paid it all back and early.
And here's the most annoying question of all: Who's more likely to produce EVs brain dead GM or super smart, highly motivated New Zealand? One thing is clear don't buy GM's stock.

[JeanJacquesNantel]

Apart from the dealership, the research and development and the marketing expenses GM will have to support when manufacturing EVs, the company will also have to deal with many more old employees than Tesla; which means higher retirement costs. GM is doomed. This is the reason why Wall Street investors don't want to hear about it.

[rhmagalhaes]

I just wished you had this presented to Biden and his team. They would probably have the incentive gone up to 20k 🤣🤣🤣

[acmefixer]

Q: "Will GM go bankrupt transitioning to EVs?"

I would like to think that since GM has already been in the EV biz more than a decade, they above all others would have the most experience with such esoterica as all the intricacies as making the battery as cost efficient as possible since it's the most expensive part.

Admittedly they're nowhere as nimble as Tesla when it comes to assembly technology, but they've had a decade to get their act together and on the road. All this said, if they can't make it through the EV transition, it's difficult to see how any other legacy car makers could do any better.

Also we should consider alternatives to bankruptcy, namely merging with some other car maker similar to what Chrysler did.

[timyarrow]

For years now my thesis is that Ford, GM, Toyota, Stellantis' Jeep and Chrysler will be bankrupt or brand lines discontinued by 2030. All the reasons: lack of innovation, inability to transition, Osborne effect, dealerships, etc. To quote The Big Lebowski "The situation is totally fucked!"

[chucktx]

“Maybe they drive Cadillacs.” Yep. Maybe. I’ve just sold a ‘16 CTS & ordered a ‘21 Y. Next year, I’ll get rid of the ‘19 CTS and order an S. Bye Caddy.

[stockey]

With all the competition coming, Tesla will face bankruptcy the first, the evaluation of Tesla right now is ludicrous.