GENERAL MOTORS

Analysis of General Motors share price

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The German and French companies are not the only ones in the automobile manufacturing industry on the stock markets. In fact, some American companies are increasingly popular such as the General Motors Group which we will examine in this article. Through this article you will learn detailed explanations relating to this company’s activities as well as a technical analysis of its share price over the last ten years.

Latest news

General Motors: Quarterly earnings beat expectations despite chip shortage

21/05/2021 - 07h26

The automotive sector is currently facing a shortage of chips, which has impacted the quarterly turnover of General Motors. However, the company's profits were well above expectations.

Elements that can influence the price of this asset:

Analysis N°1

A rise in demand relating to its own vehicles and which would be favourable overall to the General Motors Company which is one of the pioneers in this sector.

Analysis N°2

In the same way, the purchasing power of households in the countries where this group sells its products will strongly influence the future volume of sales.

Analysis N°3

We would also closely follow any rise in demand from developing countries where this company is positioned.

Analysis N°4

Of course, the price of fuel and therefore the price of crude oil should be followed attentively due to its influence on the sales of new vehicles.

Analysis N°5

We would also follow with interest the competition and the newly launched vehicle models of other automobile manufacturers.

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General presentation of General Motors

The American group General Motors is specialised in the manufacturing and sale of automobiles. More precisely its turnover is achieved as follows:

  • The sale of vehicles represents 96.9% of this company’s turnover through its various brands including Buick, Chevrolet, Cadillac, GMC, Opel, Vauxhall, Holden, Daewoo and Isuzu in North America as well as Pacific Asia, the Middle East and Africa as well as Europe.
  • 3.1% of the turnover is from the supply of financial services.

It should be noted that over 61.6% of the turnover of the General Motors Company is generated in the United States.

Analysis of General Motors share price
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The major competitors of General Motors

General Motors is currently one of the largest automobile manufacturers worldwide and is in fourth position of the worldwide classification in terms of turnover. It is therefore extremely important to know the competition in this activity sector before starting to speculate on the General Motors share price on the stock markets. To assist you we have classified all the top international automobile manufacturers according to their turnover:

Toyota 

This company is currently leader in this sector worldwide.

Volkswagen 

Toyota is closely followed by Volkswagen in second position.

Hyundai

The Hyundai group is in third position.

General Motors

In fourth position.

Ford 

The American group Ford is in fifth position.

Nissan

This company is placed sixth in this classification.

Fiat

The Fiat Company holds seventh place.

Honda

In eighth position.

Suzuki

This company is in ninth position.

Renault and PSA

Finally, Renault and PSA share tenth position of this classification.

The major partners of General Motors

General Motors regularly enters strategic partnerships with different competitors or companies from other varied activity sectors to develop its position on the markets. Here are some examples of this company’s recently implemented partnerships and alliances.

BMW 

In 2011 the General Motors Group became associated with BMW for the joint development of fuel cell vehicles.

Lyft 

In 2016, the General Motors Group became a partner of the Lyft start up, the direct competitor of Uber, which provides vehicle rental for chauffeur drivers.

NASA

Still in 2016, General Motors collaborated with NASA for the preparation of the motorised glove which is used on the International Space Station.

PSA 

In 2017, the French group PSA approved the acquisition of the Opel subsidiary of General Motors for the amount of 1.3 billion Euros.

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The factors in favour of a rise in the General Motors share price:

Firstly, the General Motors Group exercises its activities on an international level as it actually sells its vehicles in more than 35 different countries through the different brands it holds in its portfolio. It is thereby efficiently protected against geo-economic risks. The group notably benefits from a strategically advantageous position on the Chinese and Indian markets as well as from its historically strong position in the United States and Europe.

Another point we should highlight is that General Motors is the international leader in its activity sector in terms of the amount of annual sales and in fact is way ahead of the vast majority of other automobile manufacturers.

General Motors can also count on its significant work force that enables it to respond to any changes in demand as it employs over 200,000 people around the world. These employees work in no less than 400 manufacturing and sales centres.

Among the brands owned by General Motors we note certain high performing, popular and top of the range brands associated with high quality vehicles. These brands include Cadillac, GMC, Chevrolet and Buick.

Still relating to this group’s advantages we note that General Motors holds a market share that is particularly significant in the United States, one of the largest worldwide, which guarantees this company a major demand for its vehicles.

General Motors also relies on its success in the participation of certain automobile sports events which contribute to its brand image in the eyes of car sports fans. Still relating to the marketing strategy of General Motors we observe a strong advertising presence on the television channels, as well as online publicity and other media.

The factors in favour of a drop in the General Motors share price:

Firstly, although General Motors benefits from a significant leading position in its activity sector we also note that the general competition in the automobile manufacturing industry is intense and tends to increase over time. This strong competition can lead to a loss in margins and limits the market share and perspectives relating to the growth of this group.

To conclude, the General Motors Group has in the past suffered from a tarnished brand image due to the problems with certain vehicles that still negatively affect this company’s sales as clients tend to turn towards brands they consider to be more reliable and that have not received negative media attention.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.
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