Hello Tesla Truck and Take Care Ford and GM Stock

https://trendyup2date.blogspot.com/2019/11/hello-tesla-truck-and-take-care-ford.htmlTake care Ford and GM Stock as the Tesla “cyberpunk” pickup truck is coming. That much is very clear to investors following the space. Tesla’s reveal event happening Thursday evening in Los Angeles is a big deal for car people.It’s not clear what the truck will look like or how it will perform.

That isn’t all that’s opaque. The effect of Tesla’s truck ambitions on existing U.S. truck giants Ford Motor and General Motors is also difficult to call.
“Citi data suggests Ford has more headline risk than GM,” Citigroup analyst Itay Michaeli wrote in a Thursday research report. “If Tesla’s pickup impresses, Ford is competitively more exposed to share-loss risk than GM, with materially higher earnings exposure.”

It is obvious that Ford (ticker: F) is a bigger truck maker than General Motors (GM) and a large portion of its profits come from trucks. But Michaeli goes deeper in his research note. Ford sells more trucks with selling prices greater than $60,000. The Tesla (TSLA) truck will likely be positioned for the higher end of truck buyers based on its existing models and the high cost of batteries powering electric vehicles.

Michaeli is a traditional car analyst. He has an opinion on all three stocks. His rating on Ford aligns with his views regarding Tesla risk. Michaeli rates Ford shares the equivalent of Hold and has a $9 price target for the stock. He rates GM shares the equivalent of Buy with a $68 price target.

Of course, GM and Ford won’t go quietly into the night. Both have electric trucks planned, expected to launch in 2021 or 2022. Ford has also invested in electric pickup truck start-up Rivian which plans to launch its first model in late 2020. Rivian will likely beat Tesla to the market based on prior times between launch events and commercial sales.

”General Motors understands truck buyers. And we also understand people who are new coming into the truck market that view it as a lifestyle vehicle,” GM CEO Mary Barra said at the investor conference being held before the L.A. Auto Show. “We understand both customers very, very well. It will be a very capable truck.” She said the GM electric truck would be on sale in the Fall of 2021.

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