GM will lose market share in push for electric lineup

DETROIT — General Motors is risking its U.S. market share in a long-term play to offer an all-electric vehicle lineup.

But it is the smart play for GM’s future, experts say, especially if federal fuel economy regulations increase or gasoline prices drive higher.

That was a conclusion laid out Thursday by John Murphy, senior automotive analyst at BofA Securities, during a presentation of its annual Car Wars report.

“You have the gap period of time where you can ride the wave of your profitable products for a few years, so (shifting to electric powertrains) won’t impact GM for the next two years,” Murphy said. “But that means GM has to kick it off in the time where they are in a period of strength.”

That period is now, Murphy said, noting that GM is in a wealthy position because of high volume sales of profitable pickups and SUVs in the past few years. The investment

GM has said it will offer 20 electric vehicles by 2023. It has been aggressively investing billions to get there.

GM reported its firstquarter net profit plummeted 86.7%, but that was still a profit. GM’s $294 million net profit squarely beat both its crosstown rivals who reported billions in quarterly losses amid falling consumer demand as the coronavirus pandemic took hold.

Most importantly, GM ended the quarter with $33.4 billion in automotive liquidity. It’s sinking $2.2 billion into retooling its DetroitHamtramck Assembly plant to make a 1,000-horsepower electric Hummer pickup next year, a commercial electric van and several other electric SUVs.