The stock market appeared poised to continue its upward move early Friday, with stock index futures indicating modest gains would be likely at least at the opening bell. With the S&P 500 (^GSPC -0.46%) having closed more than 20% above its October lows on Thursday, bullish investors are increasingly optimistic that better times lie ahead for stocks.
Helping to bolster the mood on Wall Street, two stocks betting big on electric vehicles (EVs) made sizable gains. It's not every day that you see Tesla (TSLA 4.96%) and General Motors (GM 1.20%) working together, but the two automakers announced a landmark deal that has implications for the entire industry.
General Motors gets charged up
Shares of General Motors rose 4% in premarket trading. The automaker made an announcement late Thursday that indicated its willingness to get in line with what consumers want: a standard way to charge their electric vehicles.
The GM announcement said that the company would collaborate with Tesla to integrate Tesla's North American Charging Standard (NACS) connector design into its electric vehicles, beginning in 2025. In addition, GM customers will get expanded access to 12,000 of Tesla's Supercharger stations across the continent. The move adds to the availability that GM EV drivers currently have, through more than 134,000 chargers available via its Ultium Charge 360 initiative as well as through mobile apps.
EV drivers with GM vehicles will initially have access to the Tesla Supercharger network beginning in 2024. However, until General Motors builds in integrated NACS inlets, drivers will have to use an adapter in order to use Supercharger stations.
The news comes amid a wide range of new initiatives from General Motors this week. The company is making massive investments to support internal combustion vehicles as well, including retooling multiple factories in Michigan and Texas to support heavy-duty trucks and full-size SUVs. That stands in contrast to many automakers that seem to have fully embraced the electrification trend and have been less vocal about gasoline- or diesel-powered vehicles.
Another win for Tesla
Tesla shares jumped more than 6% on the news, as the pioneering EV specialist notched another win. The GM deal comes just a couple of weeks after Tesla inked a similar collaboration with Ford Motor Company, which included the same adoption of the charging standard and similar access to Tesla's Supercharger network.
It's evident that the move further cements Tesla's reputation for superior charging infrastructure, which will be of critical importance in driving further EV adoption. The parties didn't disclose the terms of the collaboration, though, so it won't be immediately clear what upfront financial benefit the agreement will give Tesla.
Stock analysts, however, are convinced that Tesla has just won a major victory in getting its charging standard recognized by both Ford and GM. At Wedbush, analysts maintained an outperform rating on Tesla and boosted its price target by $85 per share to $300.
If Tesla can get as much money from selling access to charging infrastructure as it does from selling its own vehicles, then the partnerships with Ford and GM will prove extremely lucrative. Yet some Tesla investors probably thought the company's goal was to maintain its edge in the EV market itself. Time will tell whether those two strategies complement each other -- or whether what's good for one part of Tesla's business ends up hurting another part.
