• Value investor Warren Buffett focuses on finding excellent firms at attractive prices.
  • GM’s focus on technological advancements and innovations puts the company in a favorable market position.
  • With the promising financial outlook and valuation pushing 20% upside, the stock appears to be attractive at the current market price.
  • Technology Incorporated in Auto-Industry

    Like many other industries, technology is transforming the auto industry at an incredible pace. With the heavy focus on environmental issues, traditional vehicles are being transformed to electrical motors due to their impact on the environment. The vehicle industry is also integrating tech-connected features, which make vehicles more than just a means to get from point A to point B.

    General Motors (NYSE: GM) is one of the early adopters and a leading company in this transformation process in the auto-industry. Its solid experience in the auto industry combined with its ability to access necessary resources, such as capital, places GM in a favorable market position during this innovating process.

    The attractive valuation and the market positioning of GM make the case even more interesting for potential investors. GM’s falls under Warren Buffet’s investing strategy, which is to find quality companies at attractive valuations.

    The General Motors Business Model

    General Motors designs, builds, and sells motor vehicles, including cars, trucks, crossovers, and automobile parts. GM operates through five segments; GM North America, GM South America, GM Europe, GM International Operations, and GM Financial. GM North America is the largest segment accounting for more than 70% of its revenues. In 2016, GM delivered 9.6 million vehicles globally, which constitutes 10.2% of the total vehicles delivered by the industry.

    GM offers its vehicles directly to consumers as well as through dealers. There are over 19,000 dealers selling GM vehicles in 125 countries around the globe. GM has assembly, manufacturing, distribution, office, or warehousing operations in more than 60 other countries besides North America.

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