Trade the General Motors share!
GENERAL MOTORS

Analysis before buying or selling General Motors shares

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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.

Elements to consider before selling or buying General Motors shares

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

If you want to implement an effective strategy for your investments in General Motors shares, you will need to carry out good analysis of this stock. One of the most important things is of course to know the company and its activities and sources of income. Here is a complete overview of the company.

The General Motors Company group is an American company in the automotive sector. More specifically, the group specialises in the manufacture and sale of motor vehicles.

In order to better understand the activities of the General Motors group, they can be divided into different divisions according to the share of turnover they generate, as follows:

  • The sale of automobiles is of course the largest part of the General Motors Group's business and its main source of income with more than 89.4% of turnover. The company sold more than 6.3 million vehicles in 2021, including passenger cars and trucks with the Buick, Chevrolet, Cadillac, GMC, Holden, Baojun, Jiefang and Wuling brands.
  • Finally, the rest of the group's turnover comes from financial services, which generate 10.6% of turnover through the subsidiary GM Financial. This activity is mainly carried out in the United States for 87.3% and internationally for 12.7%.

Geographically, the General Motors group's revenues are mainly generated in the United States, a market which generates more than 82.3% of turnover.

It should also be noted that General Motors was the leading manufacturer in the United States between 1931 and 2020. It was then overtaken by the Japanese group Toyota in 2021, which achieved more than 2.3 million vehicle sales compared to only 2.2 million for General Motors.

Analysis before buying or selling General Motors shares
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The major competitors of General Motors

To find out how the growth of the Pandora Group is likely to develop in the more or less long term, you also need to carry out a detailed analysis of the competition in this sector. We therefore propose that you discover in detail who the main adversaries of this company are:

Toyota 

First of all, the Toyota Motor Corporation group is a Japanese car manufacturer but also the world's leading car manufacturer in terms of financial performance ahead of Volkswagen and Daimler. It also has one of the highest stock market valuations in the world for this sector, all businesses combined. It should be noted that Toyota is also the basis of an innovative production system of the same name, which gave rise to the concept of Toyotism.

Ford 

Still among the major competitors of General Motors, we find the Ford group, an American car manufacturer based in Detroit, Michigan. For a long time, the group occupied the second place in the world car manufacturing market just after General Motors before being dethroned by Toyota, then by Volkswagen and finally by the Stellantis group, recently formed in 2021. Ford now employs nearly 350,000 people.

Tesla Inc 

  Also to be followed is the Tesla Group, formerly known as Tesla Motors, which is a car manufacturer specialising in electric and hybrid vehicles. It is based in California's Silicon Valley and is named after Nikola Tesla, the American inventor and engineer. The current head of the group is none other than Elon Musk, who has turned it into an innovative car manufacturer for the general public.  The company aims to accelerate the global transition to a sustainable energy pattern, in particular by boosting the competitiveness of electrically powered cars. With its innovative performance and on-board technologies, the brand easily differentiates itself from the competition.

Stellantis

Finally, you should also look at the Stellantis group, which is a brand new multinational in the automotive sector since it was created on 16 January 2021 following the merger between the PSA and Fiat Chrysler groups. Stellantis is responsible for the operation and marketing of 14 car brands, 5 of which come from PSA with Citroën, DS Automobiles, Opel, Peugeot and Vauxhall and 9 brands from FCA with Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Jeep, Lancia, Maserati and RAM.

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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Positive factors for General Motors shares
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.

Negative factors for General Motors shares
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 or a solicitation to buy or sell an asset.

Frequently Asked Questions

Who are the main shareholders of the General Motors Group today?

Currently, General Motors Group's capital is composed of several large private shareholders including Capital Research & Management World with 7.83%, The Vanguard Group with 7.06%, Eagle Capital Management with 7.01%, Berkshire Hathaway with 5.06%, Harris Associates with 4.23%, SSgA Funds Management with 4.09%, BlackRock Fund Advisors with 2.25%, Invesco Advisers with 2.06%, Capital Research & Management Global with 1.69% and Eagle Capital Management with 1.42%.

What are the different brands currently owned by the General Motors Group?

The General Motors group owns several major car brands, most of which are American or Chinese. For example, it owns the Buick brand in the United States, the CAMI Automotive brand in the United States and the other American brands Chevrolet, Cadillac, GMC and Onstar. In China, it owns the Baajun, Wuling and Faw Jiefang brands.

Which subsidiaries does the General Motors group own 100%?

As part of its strategy of positioning itself on the international market, the General Motors Group has acquired several subsidiaries which it still owns and operates today. These include Holden, Buick, CAMI Automotive, Chevrolet, Cadillac, GMC, OnStar, Baojun and Wuling. It is of course likely to acquire other companies in the months and years to come.

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