GM will be executing on its EV ambitions in 2024, says CEO Mary Barra
By Brian Sozzi, Yahoo Finance executive editor
Decades of climbing the ladder while challenging conventional thinking have brought Mary Barra to the present — the year of delivering on ambitious EV goals at storied automaker General Motors (GM).
“I think in 2024, this is a year of of execution,” GM’s longtime chair and CEO said in a new episode of Yahoo Finance’s Lead This Way. “I think it’s a big year.”
It certainly feels like it on a rainy day in late January, just miles outside of Detroit.
Barra spent half the day with me touring a new Warren, Mich., production facility that’s hand-making $300,000-plus Cadillac Celestiq EVs, which can be customized down to the stitching on the seats. These are some of the most expensive automobiles GM has ever made, and they don’t even have a gas tank.
The operation is impressively detailed from start to finish, as is the futuristic take on GM’s famed luxury brand Cadillac.
As for the other part of the day, Barra took me for a spin in the new Corvette E-ray hybrid — the American icon’s first hybrid.
The supercar features an electric motor paired with a rear-mounted V8, giving it over 650 horsepower. Barra signed off on moving the engine from the front to rear several years back to better compete on performance with the likes of Ferrari (RACE) and Lamborghini.
It was a classic play from the Barra leadership playbook: bold but respectful of GM’s history.
“I can’t take all the credit [for the engine move],” Barra said from behind the wheel of the E-ray, heaping praise on the veteran gearheads in Corvette’s development team.
General Motors chair and CEO Mary Barra tours an EV production facility in Warren, Mich., with Yahoo Finance Executive Editor Brian Sozzi. (Yahoo Finance)
Inside the leadership climb
Following in her father’s footsteps (he was a die maker at GM’s now-defunct Pontiac badge), Barra, 62, began her journey inspecting fenders at a Pontiac plant at age 18.
She went onto graduate from the General Motors Institute in 1985, where she obtained a Bachelor of Science in electrical engineering.
From there, her career path was as curvy as a country road — with stints in communications, marketing, and manufacturing.
It’s these connections to the company’s history and operations that have given Barra a lot of credibility among the rank and file — something easily seen during our factory walk in Warren.
Auto industry experts say Barra’s intricate knowledge of GM’s business has helped develop a balanced, gaffe-free leader that’s widely respected.
“She’s got a style of leadership that’s a little bit maybe steadier and less prone to controversy than some of the others,” Sean Tucker, senior news editor at Cox Automotive, told Yahoo Finance.
Altogether, Barra has drawn upon her rich experience to navigate a host of tricky situations since she was announced as CEO on Dec. 10, 2013 — the first woman to hold the top spot at a Big Three automaker.
They have ranged from apologizing to victims of a faulty ignition switch early on in her tenure to contending with a prickly President Trump tweeting about the company during COVID to more recently dealing with UAW negotiations and an autonomous Cruise vehicle that fatally injured a pedestrian.
Equally as tricky — pivoting GM to electric vehicles against a backdrop of range anxiety, fierce competition, and still relatively high prices for the technology. Between 2020 and 2025, GM plans to invest $35 billion in electric vehicle and autonomous vehicle product development, exceeding its gas and diesel spend.
The company plans to introduce the Silverado EV, GMC Sierra EV, Equinox EV, Escalade IQ, and Celestiq in 2024 alone, pushing to the forefront of the EV revolution. They join an EV lineup headlined currently by the Lyriq and Hummer.
Read more: Are electric cars more expensive to insure?
Barra had sought to be all-electric by 2035 but has since softened the stance amid industry-wide weakness in EV sales. The company will lean into the rising popularity of hybrids as a means to bridge the gap.
GM is still targeting $280 billion in total sales by 2030 — more than double that of 2021 sales — in part due to expectations around EVs.
“We still believe in an all-electric future,” Barra said.
Until recently, the heavy belief and investment in electric has weighed on GM’s stock price.
“I believe Mary has done a commendable job of laying the yellow brick road to growth, but execution has been choppy. This has been like pushing a boulder uphill, but the tide is starting to turn for GM in our view,” Wedbush analyst Dan Ives told Yahoo Finance.
A drive down valuation lane
Dive into GM’s valuation metrics on Yahoo Finance, and you can see that investors want to be shown that all of Barra’s initiatives are paying off.
GM’s forward price-to-earnings multiple is a mere 4.3 times, a sizable discount to the S&P 500 index’s 22 times. Tesla’s (TSLA) forward PE ratio stands at a whopping 63 times.
The stock also trades at a 26% discount to its book value, according to Yahoo Finance calculations.
To be fair, the stock has come on as of late due to several catalysts.
For one, GM unwrapped a $10 billion stock buyback plan and tacked on a 33% dividend increase late in 2023. Barra told me at the time of the announcement she wasn’t happy with the stock price, so she and the management team are taking action to convey their confidence to investors.
Then in February, GM said it sees “variable” EV profitability being achieved in the second half of 2024.
Fully accounted profit is anticipated in 2025.
“They are going to be successful in EVs, I am fairly confident in that,” Cox Automotive’s Tucker says.
Whatever ends up happening, one thing can’t be denied: Barra’s place in the auto leadership history books.
But ask Barra if she views herself as an iconic figure: “No — I feel very fortunate to be leading this team.”
Brian Sozzi is Yahoo Finance’s Executive Editor. Follow Sozzi on Twitter/X @BrianSozzi and on LinkedIn. Tips on deals, mergers, activist situations, or anything else? Email brian.sozzi@yahoofinance.com.
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