What Does the Orion Assembly Pivot Mean for General Motors' EV Plans?
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General Motors Company’s GM product portfolio and manufacturing strategy have been shaped by steadily tightening fuel economy and emissions standards over the past several years. In anticipation of a rapid shift toward electric vehicles, the company invested heavily in expanding EV capacity across its plants and supply chain.However, the landscape has shifted. With regulatory frameworks evolving and federal consumer incentives coming to an end, GM expects near-term EV adoption to fall short of earlier expectations. This change has led to underutilized EV capacity and higher variable costs, which prompted the automaker to reassess several major initiatives.One of the most significant outcomes of this reassessment is GM’s decision to transition the Orion Assembly plant from EV production back to internal combustion engine vehicles. The company has also agreed to sell its joint venture-owned battery cell plant in Michigan to LG Energy Solution. These moves contributed to a $1.6 billion special charge recorded in the third quarter, with $1.2 billion tied to noncash impairments. Most of these impairments stem from the Orion transition, reduced battery module assembly capacity, the discontinuation of next-generation hydrogen fuel cell development and the write-off of CAFE credits and related liabilities.Another major shift involves GM’s BrightDrop initiative, the company’s electric delivery and logistics subsidiary. GM has decided to halt BrightDrop production at CAMI Assembly while it evaluates the facility for future opportunities. Combined with regulatory changes and reduced fleet incentives, the business environment for BrightDrop has become increasingly difficult.GM expects to record an additional charge in the fourth quarter related to BrightDrop actions. Still, the automaker believes these swift and decisive adjustments will meaningfully reduce EV-related losses by 2026 and strengthen the company’s long-term positioning as the market stabilizes. F flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.GM’s Price Performance, Valuation and EstimatesGeneral Motors has outperformed the Zacks Automotive-Domestic industry and its peers, Ford Motor Company F and Tesla, Inc. TSLA, year to date. GM’s shares have gained 42.8% compared with the industry’s growth of 16.2%. Shares of Ford have risen 31.6%, while shares of Tesla have gained 12.7% in the same period. Image Source: Zacks Investment Research From a valuation perspective, GM appears undervalued compared to the industry. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.39, lower than the industry’s 3.42. Ford is trading at a forward P/S ratio of 0.32, while Tesla is trading at 14.29.Image Source: Zacks Investment Research The Zacks Consensus Estimate for GM’s 2025 and 2026 EPS has moved up 12 cents and 31 cents, respectively, in the past 30 days. Image Source: Zacks Investment ResearchZacks Naming Top 10 Stocks for 2026Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%.Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks
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