General Motors (GM) has been criticized by investors for failing to provide a clear strategy for profitability in the electric vehicle (EV) market, with analysts warning that the company’s incremental changes are not enough.
In its Q2 earnings call, CEO Mary Barra faced skepticism from Morgan Stanley analyst Adam Jonas, who compared GM to Tesla and asked how the company plans to be profitable when players like Tesla appear unable to do so. Piper Sandler echoed this sentiment, saying that GM’s current approach amounts to “tinkering around on the edges” rather than a bold strategic change.
The bank warned clients that unless GM can come up with a more comprehensive plan for its future, its stock price will remain stuck at a multiple of five times next year’s forecast earnings. This is compared to Tesla, which is valued at 140 times its estimated 2026 earnings due to its efforts in artificial intelligence and humanoid robotics.
GM’s shares have been under pressure since the company’s IPO in 2010, with investors failing to see significant returns relative to the broader market. The bank suggests that GM needs to adopt a more visionary approach to EVs, similar to Tesla’s, in order to justify a higher valuation.
In contrast, Tesla is expanding its AI-powered robotaxi fleet and exploring new geographic markets, which has contributed to its high valuation. GM, on the other hand, has focused primarily on improving efficiency at its factories rather than developing a comprehensive EV strategy.
Source: https://fortune.com/2025/07/23/gm-q2-earnings-mary-barra-morgan-stanley-tesla