General Motors Co. (NYSE: GM) and CEO Mary Barra took a terrible beating in the pages of The Wall Street Journal recently in an article titled “Mary Barra Spent a Decade Transforming GM. It Hasn’t Been Enough.” The largest U.S. car company has failed to transform into an EV giant or a leader in driverless technology. GM needed to do these things to be viewed as a competitor to Tesla Inc. (NASDAQ: TSLA), which has a market cap of $806 billion. GM’s is $49 billion.

The spread in market caps is not the only sign of GM’s trouble. Its stock is up 6% to $36 this year. The S&P 500 is up 23%. Tesla’s shares are 106% higher to $254 in that time.

What Happened to General Motors?

Four years ago, Barra said GM would shovel $35 billion into an electric vehicle transformation. What has it gotten from that? GM sold only 20,000 EVs in the third quarter. Tesla sold over 400,000, although not all were in the United States. Nevertheless, GM’s results are disappointing, given the size of its product development, research and marketing budgets, along with its huge dealer network.

The most damaging recent news for GM’s next-era products was an accident involving one of its self-driving vehicles, part of its Cruise division. A woman was hit and dragged by a Cruise robotaxi on October 2. The state of California took away Cruise’s driverless permit, and the company laid off several people, including some in senior management. Self-driving cars are as much of the wave of the future as EVs are. GM has shown how badly it can do in both.

There is nothing wrong with GM’s financial performance except that it is almost completely dependent on gasoline-powered vehicles. Revenue in the most recent quarter rose 5% to $44.1 billion. Net income fell 7% to $3.1 billion. GM sold 1.6 million cars, up 7% from the year before. (This list of best-selling GM vehicles of all time is full of surprises.)

Tesla’s valuation is based on the fact that it is an EV-only company in a world where many experts believe that more than half the cars sold worldwide in 2030 will be electric. GM cannot make a reasonable case that its share of those sales will be meaningful. That accounts for the market cap difference with Tesla.

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