GM stock jumps over electric and self-driving vehicles plan

General Motors Co.' s plans to launch 20 all-electric vehicles by 2023, combined with a new report that says the company is “well ahead” of its competitors when it comes to commercial autonomous vehicle deployment, have left some investors feeling bullish about the U.S. automaker.

GM announced Monday that it will introduce two new electric vehicles in the next 18 months, the first of at least 20 battery electric or hydrogen fuel cell electric vehicles that it plans on launching by 2023.

“General Motors believes in an all- electric future,” product development chief Mark Reuss said in a statement. “Although that future won’t happen overnight, GM is committed to driving increased usage and acceptance of electric vehicles through compromise solutions that meet our customers’ needs.”

The two new GM electric vehicles in the next year-anda-half will likely be SUV’s or a sportier car designed to compete with Tesla’s upcoming model 3 Sedan, Reuss said at a news conference at the GM technical centre north of Detroit.

“More than anything, this is trying to prove to Wall Street that they do have a plan when it comes to electric vehicles and that they have the goods to back it up,” said Michelle Krebs, a Detroitbased executive analyst with Autotrader. “And it appears they’ve done a decent job of convincing them.”

On Monday, GM’s stock — which has jumped nearly 20 per cent since the beginning of the year — surged 4.5 per cent and hit a record high. It closed at US$ 42.12 on the New York Stock Exchange, an increase of 3.95 per cent.

At the same time, an analyst’s research note released Sunday indicating that GM is ahead of the competition when it comes to the commercial deployment of autonomous vehicles may have helped boost investor confidence in the company’s technological development plans.

According to a note by Deutsche Bank Markets Research analyst Rod Lache, GM says its AV program is “on track for a critical milestone” and that the company “will be safely driving passengers in complex urban environments without a human backup driver within the next few quarters, well ahead of competitors.”

“That business built off of this platform will ramp up much faster than is widely expected and will be material, even to a company of GM’s size,” Lache wrote in his report.

After discussions with GM management, Lache said the company suggested l arge- s c al e c ommercial operations for an AV program that would compete with services such as Lyft and Uber could begin as early as 2020.

The report noted that GM’s weaker access to capital and cost of capital resulting from the company’s lower valuation could serve as a disadvantage.

Nonetheless, Lache reiterated his buy rating, with a price target of US$51.