Once upon a time, during the post-WWII Eisenhower administration, CEO Charles Wilson of General Motors (NYSE: GM) was nominated for Secretary of Defense. During confirmation hearings before a Senate Committee in 1952, Wilson responded to a question about conflicts of interest by Senator Robert Hendrickson as follows: “For years I thought that what was good for our country was good for General Motors, and vice versa.”

Detroit-headquartered GM’s ascent to the pinnacle of US manufacturing clout and excellence during that period made Chevrolet and Buick household names, with Cadillac hailed as the Holy Grail of luxury cars. General Motors’ supremacy has since been supplanted by rivals, both foreign and domestic, but the company continues to maintain a global presence in the automotive industry.

Headwinds

The Fed’s interest rate hikes and the escalation of inflation that began in 2021 severely impacted car-loans industry-wide. According to USAToday, car loans were at 3.86% in 2021, and the average five-year rate at present is 7.82%, based on a 700 FICO score. The average rate for used car buyer financing with deep subprime credit — someone with a credit score in the range of 300 to 500 — was as high as 21.57%, according to data from Experian. Unique to General Motors were the following legal, financial,  and compliance landmines:

• General Motors settled a class action lawsuit claiming that GM’s Duramax diesel engines contained faulty fuel pumps. The suit alleges GM knowingly sold defective transmissions between 2015 and 2019 in roughly 800,000 Cadillac, Chevy and GMC models
• The Texas Attorney General announced a suit against General Motors over allegations of illegal collection and sales of driver data to insurance companies. 
• GM has had to cut over 1,000 software jobs and cut back operations in China and Ecuador as EV transitions still experience hurdles.
• Recent missed earnings targets have caused downgrades from UBS and other Wall Street analysts.

Nevertheless, investors are much more concerned with future stock performance over the next 1, 5, to 10 years. While most Wall Street analysts will calculate 12-month forward projections, it’s clear that nobody has a consistent crystal ball, and plenty of unforeseen circumstances can render even near term projections irrelevant. 24/7 Wall Street aims to present some farther-looking insights based on GM’s own numbers, along with business and market development information that may be of help to our readers’ own research.

Key Points In This Article

• GM has reduced battery costs, launched EV new models, and scaled production, GM expects its EV segment to be in the black with models like the Hummer EV, Chevy Silverado EV, and Cadillac Lyriq already on the market. 
• The Ultium Drive system and battery plants in Ohio, Tennessee, and Lansing are key to its e-mobility ambitions. Additional battery production investment for vertical integration is a key component of GM’s strategy
• As consumer trends are demanding lower-priced vehicles, CEO Mary Barra’s announcement of new hybrids to join its Corvette E-Ray model is in process and expected for release in 2027.
• Robotaxis: GM’s Cruise plans to potentially start charging fares by early 2025. A strategic partnership with Uber Technologies (NYSE: UBER) is set for 2025, wherein Uber will offer Cruise robotaxis on its platform. 

Recent GM Stock News and Updates

11/7/2024

Today General Motors announced plans to discontinue production of the gas-powered Cadillac XT4 in January 2025. The company is shifting its focus toward electric vehicles and will invest $390 million in its Kansas assembly plant to produce the next-generation Chevrolet Bolt EV. In addition, GM will cease production of the Chevrolet Malibu in the upcoming weeks.

11/6/2024

General Motors’ shares increased today following the election of U.S. President Donald Trump.

11/5/2024

General Motors announced another recall, this time for the 107 Bolt EV and EUV due to a fire risk. The recall includes models from 2020-2022 due to a potential failure in the installation of advanced diagnostic software, which could result in a fire risk when charged to full or near-full capacity.

11/4/2024

General Motors is recalling over 50,000 vehicles in Canada due to a faulty transmission control valve. This issue can cause harsh shifting and in severe cases, rear wheel lockup, increasing the risk of accidents.

11/1/2024

General Motors saw a notable increase in short interest during October. As of October 15th, the number of shares sold short rose by 6.8%, reaching 32.76 million shares. This translates to a days-to-cover ratio of 2.4 days, indicating that it would take roughly 2.4 days to cover all short positions given the average daily trading volume. Approximately 3% of GM’s outstanding shares are currently short sold.

10/31/2024

The U.S. Department of Energy has awarded General Motors an $8 million grant to improve its electric vehicle battery recycling. The funding is intended to aid GM as the company develops more efficient recycling methods for EV batteries.

10/29/2024

A recent statewide poll shows that Michigan citizens are split on the issue of federal subsidies for General Motors. The poll was conducted to gauge public opinion on the company’s plan to retool a Cadillac sedan plant in Lansing for future electric vehicle production.

10/28/2024

GM Defense has finished building the first batch of armored SUVs for the U.S. State Department’s Diplomatic Security Service (DSS). These heavy-duty SUVs are designed to protect high-ranking officials during their travels.

10/25/2024

Bernstein has raised its price target for General Motors from $53 to $55 while maintaining a “Market Perform” rating.

5 to 10 year Review

Mary Barra took over as General Motors’ CEO in 2014. Since that time, she has presided over a number of highs and lows for the company, including:

• A 2014 general recall of faulty ignition switches that were linked to over 124 deaths and a $1.5 billion settlement.
• A 2016 $500 million investment in Uber rideshare rival Lyft (NASDAQ: LYFT).
• The 2016 launch of the Chevrolet Bolt EV, which also serves as a prototype for the Cruise robotaxi.
• GM’s 2017 sale of Opel-Vauxhall to PSA Groupe SA resulted in a $6.2 billion hit and a $7.3 billion tax asset write-down, resulting in a loss. Ironically, shedding the European operations, which lost over $1 billion in 2015 and 2016, was hailed by shareholders, resulting in a stock price boost.
• In 2021, GM scored a deal with LG Chem Ltd. to supply enough cathode materials to build 5 million EVs.
• Between 2022 and 2023, GM’s EV production ramped up to deliver over 400,000 vehicles. 

Fiscal Year	Price	Revenues	Net Income
2015	$34.01	$135.725B	$9.687B
2016	$34.84	$149.184B	$9.427B
2017	$40.99	$145.588B	(-$3.864B)
2018	$33.45	$147.049B	$8.014B
2019	$36.60	$137.237B	$6.732B
2020	$41.64	$122.485B	$6.427B
2021	$58.63	$127.004B	$10.019B
2022	$33.64	$156.735B	$9.934B
2023	$35.92	$171.842B	$10.127B
2024 TTM	$47.76	$178.093B	$11.078B

Key Drivers for GM’s Future

• General Motors is decidedly “all-in” on EVs, unlike rival Ford, which announced some EV production cutbacks. GM’s larger international network will help to boost this segment in upcoming years.
• GM’s arrangement with Uber to supply Cruise robotaxis should start generating another revenue stream commencing in 2026. 
• General Motors’ Advanced Driver Assistance Systems, a project under its R&D department’s AI development, is tentatively projected to kickstart sometime in 2028. 
• Multiple outstanding lawsuits can impact GM’s progress towards the latter part of 2024 going into 2025. 
• GM’s battery technology R&D is anticipated to create greater efficiencies, storage capabilities, and longer running times between charges in the future. 

Stock Prediction for 2025

The consensus rating from 27 Wall Street analysts is “outperform”. The average price target in 12 months is $54.00, which is roughly down -2.40% from the price at the time of this writing. 24/7 Wall Street’s 12-month projection for General Motors’ price is General Motors’ price is $44.30, which would be (-19.92%). We believe that this is a conservative estimate based on the Texas and illegal data harvesting and transmission class action suits, which can likely drag the stock price down throughout 2025, despite other GM gains. Additionally, the current EV mandate from Washington, DC may no longer be in effect, based on the results of this November’s presidential election. 

GM’s Next 5 Years’ Outlook

General Motors’ Cruise autonomous vehicle technology has undergone a number of growing pains. After a 2023 San Francisco incident involving a Cruise vehicle that resulted in a pedestrian critical injury, Cruise halted production and issued a Cruise recall. Relaunching in Arizona, in Q1 2024, GM pumped an additional $850 million into Cruise for resumption in Texas. Cruise robotaxis are scheduled to supply Uber later on in 2025, and implementation to generate revenue is anticipated by 2026. 24/7 Wall Street projects GM stock to rise in 2026 to $45.25, which would equate to an approximate 2.14% gain year-over-year.

Stronger EV sales with new models added to its line of Hummer EV, Chevy Silverado EV, and Cadillac Lyriq top sellers, along with the release of additional hybrids to meet demand for 2027 should help GM reach our projected stock price of $48.30, a 6.74% gain year-over-year.

General Motors’ proprietary battery manufacturing in MI, OH, and TN will likely augment the completion of its investment in Lithium Americas Corp in Canada. By owning a stake in LAC, GM should have an assured supply of lithium for its Ultium Drive batteries. The cathode supply deal with LG Chem should round out supply chain security for the Ultium platform, which should also proliferate its Ultium 360 charging platform throughout 2028. Our 2028 GM stock price projection is $49.50, a 2.48% gain year-over-year gain. 

2029 should begin to see revenues begin to manifest from General Motors’ autonomous driver assistance systems (ADAS), which are based on the same technology developed for Cruise. This is a hands-free driving system installed in privately owned vehicles, which can ostensibly reduce collisions and other vehicular accidents caused by driver-operator error. Dubbed “Super Cruise”, the GM’s ADAS still requires the driver to be attentive to traffic and road conditions, unlike the Cruise robotaxis, which are designed for urban environments, and more congested traffic situations. GM cars equipped with ADAS should sell well, as auto insurance premiums should ostensibly see commensurate reductions from lower collision risks.  Our 2029 GM stock price projection is $51.35, a 3.75% gain year-over-year.

GM Stock in 2030

General Motors’ R&D work in artificial intelligence extends beyond its ADAS and Cruise robotaxi projects. Applying AI to streamline design and manufacturing efficiencies, GM will be able to utilize AI for better marketing and sales. By expanding data collection and applications for ride-sharing, logistics, urban mobility solutions, and customer satisfaction preferences, GM can customize vehicle models and features for increased demographic targeted appeal. 24/7 Wall Street’s price target for 2030 is $53.90. This would be a 5% gain over 2029 and would mark a -2.51% 5-year cumulative loss.

Year	EPS	Projected Price
2025	7.67	$44.30
2026	8.35	$45.25
2027	8.52	$48.30
2028	8.75	$49.50
2029	9.94	$51.35
2030	10.17	$53.90

 

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