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The boss of the company has announced that the carmaker is committed to fighting for EV market share until, the company is the number one player in North America.

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For those of you who do not know, GM, back in 2012 was the biggest player in EVs in North America. Its car, Chevrolet Volts, sold 23, 000 units, nearly a double of what its nearest competitor sold at the time, an 18% of the EV market share in North America. 

Tesla started its glory back in 2019, when it started selling Model 3, and turn GM from the being the king of the EV market, into an underdog. Tesla broke all the records at that time and some estimates suggest, that its market share rose as much as 80% in the first half of 2020.

There’s no doubt that EVs will dominate the car market in the future, and GM, according to its chief executive, Ms Barra, will increase its EV research and development to $27 Billion. The company has a very ambitious plan, as it expects to sell 1m EV in 2025. 

There’s no doubt that ice carmakers like GM will try to get as much as possible EV market share, in following years. They need to do it, to survive, while the same time still operating the “ice” business. Is a tricky business, because you need to continue operating the losing business, to keep the cash flow coming through the doors, and reinvest (whatever it's left) it back into the EVs.

Plus, GM will be selling those EVs mostly at a loss, to keep the price low, and increase its market share. The reason is that batteries are still expensive. 

At this time of writing, Tesla has the upper hand, in battery pricing and quality, while the rest of the market sacrifice both to increase market share. At some point, profits mush show up, in the financial statements. 

The catch-up game, GM is trying to play with Tesla, it reminds me when Amazon was building its Amazon Web Services, and it took the competition (if I remember well about 7 years to catch up), and now is dominating the market.

GM is not doom to fail, but indeed it has a long way to go. 

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Buying a company who’s trying to turn itself around, is tricky. Those who do will give investors amazing returns, but those who fail to turn their business around will be doomed. If you’re looking to buy GM, you need to pay close attention to the management team, and their past experiences, and determine based on what you find if they will be able to turn it into a success story or not. Plus, have in mind, that will take years before it happens, so expect some turbulence along the way.

Indeed, nothing is guaranteed. 

Thank you for reading, and let me know your thoughts in the comments below!