What happened 

Shares of General Motors (NYSE:GM) were trading lower on Thursday, amid a broader decline in consumer discretionary stocks triggered by investor worries about rising COVID-19 cases in U.S. states that have reopened.

As of noon EDT, GM's shares were down about 6.4% from Wednesday's closing price.

So what

Traders and investors were reacting on Thursday to reminders that U.S. coronavirus cases are still rising, and that the pandemic has not yet passed. There are now over 2 million cases, and -- notably -- COVID-19 hospitalizations have been rising in some of the states that were aggressive about reopening, including California, Florida, and Texas.

Chevrolet Silverado pickups on the assembly line at GM's factory in Flint, Michigan.

With dealer supplies running low, GM is scrambling to make as many pickups as it can. Image source: General Motors.

Like other consumer discretionary companies, automakers' sales rise and fall with consumer confidence. If infection rates rise to the point where state and local authorities feel compelled to shut down economic activity again, or if consumers worried about the virus (or the economy, or both) cut back spending, or all of the above, that's clearly not good for GM and its rivals.

That's probably most of the reason that GM's shares were down on Thursday.

Now what

There's a related concern for GM and its U.S. rivals that auto investors should watch carefully: factories.

Demand for some vehicles, including high-profit pickups, has been resilient through the coronavirus crisis, to the point where dealers are now running low on trucks. GM and its Detroit rivals have been scrambling to replenish those inventories since reopening their factories in mid-May.

That's a profitable (and arguably bullish) situation for GM and the others. But if automakers have to idle U.S. factories for a second time amid rising infections, that won't be bullish at all.