GM Leapfrogs Ford As Electric Vehicle Self-Driving Investment Plans Soar 75% By Investors Business Daily
General Motors (GM) again increased spending plans on electric cars and autonomous vehicles, surpassing Ford’s (F) own aggressive investments. GM stock rose.
GM said Wednesday it will now invest $35 billion to develop EVs and AVs through 2025. That’s a 30% increase from its most recent forecast for $27 billion set last November, and a 75% increase from an initial forecast of $20 billion set in March 2020.
By comparison, Ford in May announced plans to spend $30 billion on EVs and AVs through 2025, up from a prior view for $22 billion.
But Ford’s investments include years prior to 2020, while GM’s spending is for 2020 through 2025.
GM automaker also announced that it plans to build two more battery plants in the U.S. by mid-decade. Two other battery plants are already under construction in Tennessee and Ohio.
“We are investing aggressively in a comprehensive and highly integrated plan to make sure that GM leads in all aspects of the transformation to a more sustainable future,” GM CEO Mary Barra said in a statement Wednesday.
In addition to electric cars, GM’s working to develop batteries, fuel-cell technology and self-driving electric vehicles.
On Tuesday, GM announced that it will supply batteries and fuel cells to Wabtec (WAB), which is working on the first electric locomotive. And its Cruise majority-owned subsidiary revealed that 100 preproduction self-driving electric vehicles are being assembled for testing purposes.
By 2025, General Motors plans to sell more than a million electric cars around the world annually. By 2035, it plans to only produce electric vehicles.
GM accelerated its EV shift after President Biden signed a series of executive orders pushing a climate-friendly agenda early this year.
GM now expects adjusted earnings before taxes of $8.5 billion-$9.5 billion in the first half of 2021, up from an earlier view for $5.5 billion, due to strong demand for its SUVs and trucks. It had already guided higher earlier this month but gave specific numbers Wednesday, saying it remains cautious for the full year.
GM Stock
Shares rose 1.6% to 61.76 in Wednesday’s stock market, off session highs. GM stock eyes a 63.54 cup-shaped buy point, according to MarketSmith chart analysis. Investors could use 64.40 as a high handle entry.
Ford stock, on the IBD Leaderboard, edged up 0.1% to 15.02. It’s extended after clearing a cup-without-handle 13.72 buy point. A pullback to the rising 21-day line could offer a new entry.
On Wednesday, Ford announced that its Lincoln brand will electrify its lineup by 2030, meaning the vehicles will all fully electric or hybrid electric. Lincoln’s first all-electric vehicle will debut next year, as the brand turns 100 years old.
By 2030, Ford expects 40% of its global EV volumes to be all-electric.
Auto giants are racing to catch up with Tesla (TSLA), the global EV leader. Besides GM, Volkswagen (VWAGY), the world’s no. 2 automaker by sales, plans to go all-electric. It has set a 2026 target date.
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