Ford & GM Monthly Update

Every month Ford Motor Company (F) and General Motors (GM) provide their U.S. sales updates which include zero-emission, or ZE vehicles. It's important to monitor these trends both over the short-term and longer-term as time goes by to recognize progress for both companies, and/or any challenges or issues.

Ford

F finished 2024 selling just under 98,000 EVs in the U.S. Retail investors need to remember that F does not sell directly to consumers, but rather sells to dealerships so while they recognize revenue for each unit sale, there is still a lag-effect of time before each unit is purchased by a consumer.

The 35 percent increase in EV units was driven primarily by a 27 percent increase in Mustang Mach-Es totaling nearly 52,000 units, followed by a 38 percent increase F-150 Lightnings totaling approximately 33,500 units. E-transit units sold in the U.S. increased by 65 percent to approximately 12,600.

Below are monthly U.S. sales trends for each EV make.

Overall, F experienced solid growth in EV units sold in the U.S. Demand from dealerships for Mustang Mach-E sales seem to have improved as the ratio of stocks to deliveries has improved dramatically below the historical 3.7 average to less than 2 times. F has been a leader in pick-up truck sales through the F-150 Lightning, and continues to increase its E-transit sales.

EV sales performance has continued to weigh on the bottom line as the Ford Model e segment burned through $5.3 billion in income before income taxes, while generating just over $4 billion in sales. External sales revenue was down 43 percent over the first nine months of 2024 suggesting substantial price discounting, as concerns regarding EV demand has remained a sticking point for all OEMs.

GM

GM finished 2024 selling approximately 114,000 EVs in the U.S. Just like F, GM does not sell directly to consumers, but rather sells to dealerships.

GM outperformed F with a 50 percent increase in EV units sold in the U.S. GM has brought more makes to the table than F and there were key contradicting shifts from 2023 including a 330 percent increase for Hummer EV Pick-Up/SUVs (nearly 14,000), a 210 percent increase in LYRIQs (nearly 28,500) while Bolt EV/EUVs declined by 86 percent (nearly 8,600). GM's delivery van, the Brightdrop witnessed an increase in units delivered in the U.S. by over 200 percent. That being said the 1,530 units delivered are far below both F and Rivian Automotive, Inc. (RIVN).

Many of GM's other makes were produced and sold during 2024 only. Below are remaining results. It should be noted that while F's U.S. retail sales are disclosed monthly, GM's are provided on a quarterly basis.

The Equinox during 2024 became GM's top selling make with nearly 29,000 units sold just squeezing by LYRIQ sales. The Blazer EV was another make for GM that jumped substantially during 2024 to approximately 23,100 units sold. The Silverado and Sierra EVs witnessed units sold of approximately 7,400 and 1,400 respectively.

The most dramatic shift is the redesign of the Bolt EV that will include Ultium technology for an over 300 mile range. During Q4 of 2024 no Bolt EVs were sold in the U.S. and pricing has yet to be divulged although competitive peers include Nissan Leaf, Mini Cooper SE, Hyundai Kona Electric, and Kia Nero EV. During the Q4 conference call, GM will provide more guidance on units produced and sold for 2025.

GM does not break out its EV business by revenue, gross margin, operating income, or net income. At some point I expect that they will, notably as their units sold has eclipsed F through 2024. The next 10-K may divulge these details once filed. As F's revenues have dropped, it is important to see to the degree that GM has been discounting prices too for EV sales.

Key Takeaways

GM's stock price to operating cash flow per share valuation has dropped back to 3 times, in-line with pre-COVID levels. Like F, GM has also been facing flat to declining overall unit sales across operations. With pricing expected to continue to decline and/or weaken for automotive sales, revenue expectations over the coming years are also expected to slow strongly from the past couple of years performance.

This places increasing pressure on both GM and F as they navigate the EV transition and the challenges of scaling in a positive cash flow manner. GM has not succeeded with its Cruise segment and autonomous vehicle programs. To date, both companies have illustrated that they are not yet capable of rapidly scaling EV technology, nor making inroads into autonomous driving and technologies.

As such current stock prices for F and GM have retreated from previous peaks. GM's decline hasn't been as extreme as F's, but near-term prospects are no longer as robust and Wallstreet's influence to pump these legacy companies has run its course.