we're joined by dan Ives, managing director of equity
Research over at Wedbush Securities. Great to have you
on this morning GM has some pretty lofty goals in
this presentation saying that it wants to overtake Tesla as
the top seller of E. V. S.
What do you think? Is that realistic? Yeah
, we've been here at the G. M.
And or staying today. There are presentations as well
. If you take a step back GM and what
marriage really doing is transforming this company into potentially V
powerhouse over the next decade. Now, I continue
to believe Tasso is gonna, you know, have
that massive lead in E. V. S.
But this is a$5 trillion green tidal wave and
I think that's something that GM is focused on.
I view this as sort of a rereading stock that
continues to sort of be underestimated in terms of what
they're doing on T. V. S. I
think this was really marrying the team come out swinging
in terms of putting those financial targets around it.
Gm saying that it wants to be viewed more like
a tech stock GM valued at 79 billion. Tesla's
valued at 750 billion. Do you think that things
will start to even out, Look, I mean
, I I've never viewed over the last decade.
Tesla is an automotive company of um is is a
disruptive technology player and to that point, I think
what you're seeing with GM is that you're gonna start
to see that E. V piece. I think
conversion about 20% of the cousin based by 2026 plus
the services in the software piece, that's gonna be
a massive part of the re rating in GM which
is why we think$85 is sort of the fair
value as they start to get a little more that
re rating and I think it's on your stone to
see with ford, you're seeing with GM you saw
with VW as more of these automotive players are going
to start to be I think respected because of that
IV push that's the key given all that and important
how important the chips are in terms of making all
of these, not only E V but in terms
of the technology being viewed as a tech company,
do you think that the chip shortages going to hamper
any of of these plans for GM Yeah, if
you look for GM clear the chip shortage and the
bolt issue bolts been a bit of a black guy
, you've seen it in stock but when we look
past 6 to 9 months from now, you know
, I don't really view this is something that's going
to deter the Tv pushed 30 models that they'll have
and ultimately, you know, 30 billion they'll be
spending. Now I think GM similar what Tesco is
doing is going to want more control over their chips
and I think that's something that you can see in
some strategic partnerships are even starting to maybe potentially build
their own ships down the road. But I don't
view this as really impacting the screen tied away that
GM is going after because if you look at it
given their distribution of vertical integration of software services,
the idea, this is the renaissance of growth in
Detroit. Meanwhile, Tesla is going to be having
its investor day today. What are you expecting to
hear from Elon musk? Yeah, not surprised that
that's in Austin because being awesome, That's the big
build out gigafactory, which you know, it is
a huge part of the strategic focus of testing.
I think that's gonna be a big part today.
Is that in terms of what's happened with Austin that
bill down and the opening of that over the next
call it a month or two? The bruin build
out, which I think ultimately steady start producing cars
over the next month right now. You saw by
the chip deliveries? Tesla does not have a demand
issue would supply. That is the issue here and
they're going to expand capacity. That's going to be
a focus there. But of course with musk,
there'll always be some fireworks and right now I think
Tesla continues to be in a Teflon like position of
strength despite the chip shortage, what do you make
of what's happening in china right now? And do
you think that that could impact Tesla at all because
they have been so successful with that shanghai factory,
but china as you know, has been just really
taking aim at a wide range of industries in the
country. Do you expect that that will have an
impact on Tesla at all? Yeah, and that's
always been a worry for for not just Tessa Apple
. Really the$2 have had massive success in China
. If you look at Tasso Giga that's that's the
hearts and long to their success and we think about
40% demands will be coming at China for Tessa going
into next year. But I do believe that they've
started playing nice in the sandbox with Big Brother in
Beijing the safety issues. The pr issues I think
must have gotten the message. They'll hand hold them
through this, remember for china they love having tassel
in the country. It's it's almost a feather in
their cap as well being the innovator that musk is
. So I think they'll be able to balance that
. It's always a risk. But I believe we're
starting to demand And some of those black clouds lift
in china from Tesla's perspectives. What about lucid motors
? Do you think they're going to pose a threat
to Tesla at all? I loosened the special company
. Uh, and I think anyone that's seen those
cars that have come out, I mean they're I
think they're going to be a formidable competitor but it
goes back to, you know, this is the
biggest transformation to the auto industry since 1950s. I
mean in the US. Only 2% of autos or
TVs when that goes to 10% by 2025, 20%
by 2030 loose, it's going to be a big
player there along with four GM and others and I
think it speaks to this green tidal wave that we're
seeing take hold in the US which has really happened
globally with China leading the way. Do you think
Apple is eventually going to get into this space and
make its own car? Well, it's what we
believe Apple comes out of the car in 2024 we've
talked about that now we think that the ultimate partner
uh, and and they're not gonna miss, I
produced their own cars, we believe VW's the likely
partner there because Apple is not going to miss out
on this. It's all about modernization from their perspective
and we look down the road, you're starting to
see a convergence of technology and automotive. But I
do believe in Cupertino an Apple car. It's not
a matter of if it's a matter of when we
believe 2024 along with a partner that we expect to
be announced, you know, relatively soon, How
important is this infrastructure package that? I mean it's
anyone's guess what's actually going to pass but how important
is that in terms of building out the infrastructure around
charging stations in terms of this IV push, it's
the carrot and the stick because we could talk about
EVs Going from 3% penetration 10-20. You need the
infrastructure charging stations, there's only 100,000 charging stations in
the us today. You need 500,000 by the end
of the decade. For that to ultimately, you
know, come to fruition, you also need to
have a change in the grid system because the E
V. Is what we're seeing to supply chain.
The infrastructure that's like tax credits and the foundational pieces
here. You can talk green tidal wave all you
on the bell way. But if you don't put
the money where the mouth is, then Eve,
in terms of the fundamental shift is not going to
happen. Like we see that's why it's so important
and it's a big focus of the Bad Administration.
All right, dan Ives, thank you so much
. Managing Director of Equity Research at Wedbush Securities,
really appreciate your time this morning.