Some big changes are coming to General Motors (GM) – that is, the company is turning Cadillac into a separate company and is moving the headquarters from Detroit to New York City. While General Motors has not indicated much about its plans, a good case could be made for a spinoff of Cadillac as a public entity.
No doubt, GM stock definitely needs a lot of help. For the year so far, shares are off about 18%. This compares to a 6% return for rival Ford (F). And as for Tesla (TSLA), it’s in another league entirely, with gain of 68%.
The main reason for the lackluster performance of General Motors is, of course, the uncertainty of the recalls. Let’s face it, measuring the impact of the liability exposure is pretty dicey. As seen with other companies in similar situations, like BP (BP), it’s common for the stock price to remain mostly dead money. Read