Morgan Stanley says it prefers General Motors (NYSE:GM) over Ford (NYSE:F).
Analyst Adam Jonas on General Motors: “GM is moving ‘all in’ on EVs. No hybrids. No Europe. Allocating $27bn towards EV investment by 2025 with a plan to launch 30 EV models by 2025. GM expects cost parity of ICE & EV by mid decade with 1 million EVs by 2025 and EV costs down 60% by mid-decade. GM has a head start vs. other legacy OEMs in the race for EVs at scale and a clear strategy to get there.”
On Ford : “We think Ford has the sense of urgency on EVs, but the strategy is still not fully clear to us. The business remains saddled in Europe (which we value at negative $9bn) and is sub-scale in China vs. other major OEMs. We believe it can ultimately transition to EVs and can leverage strong fleet/commercial positions (F-150, Transit van) but faces substantial headwinds on high margin ICE products that face de-adoption.”
GM is forecast to grow its top line at 1.4% through 2030 while Ford is seen showing -1.1% growth for the same time period. GM is also given the edge on profitability, EV strategy, geographic exposure and on the risk-reward profiles of the two Detroit automakers.
