General Motors (NYSE:GM), one of the world’s oldest and largest automakers, is supercharging the automotive race with newer partnerships and investments. Yesterday, GM announced a pact with rival electric vehicle (EV) maker Tesla (NASDAQ:TSLA) that would allow GM EV drivers to use Tesla’s supercharger network. At the same time, GM announced an investment of over $500 million in the Texas plant to produce next-gen internal combustion engines (ICE)-based full-size sport utility vehicles (SUVs). Following the news, GM stock rose more than 3.8% in extended trading on June 8.
GM Leverages Tesla’s Superchargers
General Motors CEO Mary Barra and Tesla CEO Elon Musk announced the deal on Twitter Spaces yesterday, which seems like a win-win for both companies. As per the pact, GM’s EV drivers will start accessing 12,000 of Tesla’s supercharger networks across North America starting next year. Drivers will have to purchase an adapter and use it alongside GM’s EV charging app to use Tesla’s charging stations. On May 26, Ford Motor (NYSE:F) announced a similar partnership with Tesla.
Beginning in 2025, GM will start installing NACS (North American Charging Standard) charging ports in its EVs that are compatible with Tesla instead of the current ones. The partnership with Tesla will help save roughly $400 million of GM’s investments in building EV charging networks, Barra stated in an interview on CNBC yesterday.
GM Strengthens Manufacturing of ICE Autos
General Motors is also continuing to strengthen its portfolio of ICE autos across the board. The Arlington, Texas facility is set to receive a $500 million investment, which will be used towards new tooling and equipment in the stamping and assembly lines. The plant manufactures GM’s full range of full-size SUVs, such as the Chevrolet Tahoe and Suburban.
The company faces stringent norms relating to environmental protection in California and elsewhere. The management is also meeting with lawmakers to draw a roadmap to meet the strict emission requirements as well as discuss strategies and investments for autonomous vehicles.
Is GM Stock Expected to Go Up?
Recently, Citi analyst Itay Michaeli reiterated a Buy rating on GM stock with a price target of $85 (138% upside potential). Michaeli believes the company is well poised for the new technology-driven AI cars compared to its peer, Ford, and considers GM his top pick.
On TipRanks, the average General Motors stock prediction of $47 implies the stock has room to grow by 31% from current levels. Meanwhile, out of the top six analysts who recently rated GM stock, five assigned a Buy rating and one rated it a Hold. Year-to-date, GM stock has gained 6.5%.