For years, investors have poured money into legacy automakers as a cheaper derivative play to Tesla and other high-flying electric vehicle stocks.
But that may be the wrong strategy for those looking to participate in the highly anticipated EV boom, according to Morgan Stanley's Adam Jonas.
"What investors seem to be waking up to today is the idea that the tens of billions of $ invested in EVs may be value destructive rather than value accretive."
Month to date, GM has dropped about 15%, while Ford lost 21%.
This, coupled with rising interest rates that threaten demand and average transaction prices, is enough to keep investors on edge, Jonas said.
Persons:
Morgan Stanley's Adam Jonas, Ford, Jonas, Michael Bloom
Organizations:
Ford, General Motors, GM