Market-darling money investor and manager Cathie Wood, leader of Ark Investments and a bull on Tesla, gives a bad forecast for other automakers General Motors and Ford.
“It will be very hard for the companies to deal with during the upcoming five to 10 years,” Wood said to Barron’s.
“And we believe they will not be alive in their current situation. They could be in combination with somebody else, or they might go bankrupt.”
Other investors supposedly disagree. GM stock has grown by 11% in the previous month, and Ford has went up by 27% thanks to optimism about their power to compete with Tesla. That firm’s shares went higher by 29% in the previous month.
GM recently sold at $64.74, up by 0.2%; Ford was at $20.06, up by 0.5%; and Tesla was at $1,114.50, up by 2%.
As for Tesla, if it is “the first to be successful within autonomous cars in the United States, we are starting to believe that not only will the company take that biggest share of the EV market, we think that it might take 20% or 25% per share of the overall vehicle market in five years,” Wood said.
She predicts the company will reach $3,000 in 2025.
Going back to GM, Morningstar investment manager David Whiston is a bull. He gives fair value to the stock at $68.
“General Motors products are some of the best design and quality in decades,” he said last month. “A competitive lineup in every segment, combined with smaller costs, says that GM will start realizing the scale to meet its size.”
These predictions come at a time when companies in the vehicle market are struggling to get the supplies they need to build vehicles thanks to the ongoing supply chain problems. Even with these shortages, companies like Tesla continue to thrive and challenge much older and established companies like GM and Ford.
Author: Steven Sinclaire