The title of this post was motivated by a financial piece about GM in Seeking Alpha written by Aaron Butler. In the article, Butler describes GM as “the fastest horse in the auto race.” In addition to GM’s financial performance versus competitors during COVID-19, Butler highlights the company’s strides in what he calls Auto 2.0. For me, Auto 2.0 is synonymous with TaaS (transportation as a service). The centerpiece of Auto 2.0 for GM is their Cruise subsidiary. Between moving people, moving things, data insights, and experiences, GM sees the market for Auto 2.0 as a $8 trillion opportunity. As I’ve stated before, much of Tesla’s value seems to be based on Auto 2.0, which is warranted. But GM’s investments in Auto 2.0 through Cruise is being “zeroed out” as Butler described. And that’s a mistake. Tesla, Alphabet’s Waymo subsidiary and yes, GM, will all be major players in Auto 2.0. Not “if,” just “when.”
I also discussed the business case for GM recently in this Medium article.