America's New Favorite EV Isn't Tesla-and the Stock May Surprise

After gaining just 6% last year, consumer discretionary stocks entered 2026 looking for some relief from the fallout from tariffs, margin compression, and a weakening labor market. 

But for automotive stocks, the situation was a little different. According to Autoweek, U.S. auto sales were strong in 2025, given recent standards, with 16.17 million vehicles delivered. 

Whether for EV makers or legacy automakers, shareholders are hopeful that momentum will continue this year. But while the conversation around EVs continues to be dominated by Tesla (NASDAQ: TSLA), a household name is proving to be America’s favorite alternative: General Motors (NYSE: GM).

The Chevy Equinox EV Is Moving on Up

Comparing GM and Tesla is like comparing apples and oranges. While the latter is a member of the Magnificent Seven with a $1.48 trillion market capitalization, GM has a market capitalization of $77.22 billion, despite being founded in 1908. 

Tesla has seen its shares appreciate to the tune of 1,451% since the start of 2020. Over the same period, GM’s stock has gained more than 128%—a respectable performance, but a drop in the bucket compared to its Elon Musk-led counterpart. 

GM is seen as a reliable, low-volatility, buy-and-hold stock, as evidenced by its nearly 93% institutional ownership. By comparison, just over 66% of TSLA shares fall under institutional ownership.

But that has not stopped GM from achieving notable EV market share. Last year, the company’s Chevrolet Equinox EV, which has a starting price of around $33,000, ranked third among all EVs sold in the United States. The company’s best-selling electric saw sales doubled from 2024 to 2025 to reach 57,945 deliveries.

Of course, that still pales in comparison to the sales of GM’s line of internal combustion engine (ICE) vehicles. For example, last year GM delivered more than 93,000 GMC Yukons and more than 114,000 Chevy Tahoes. But on a year-over-year basis, those sales only represented 6.6% and 8.6% gains, respectively. 

Sales of the Equinox slowed toward the end of 2025 as the Trump administration allowed the Biden-era EV tax credit to expire. But EV companies have found short-term workarounds. With or without those credits in place, the transition to electrification remains intact. According to industry consultancy firm Grand View Research, the North American segment of the EV market is forecast to undergo a compound annual growth rate (CAGR) of 10% from 2025 to 2030.

At the same time, GM’s stock rose more than 60% in 2025, presenting the argument that the best vehicle stocks to own in the race to electrification might not be startups or luxury brands, but legacy automakers with entrenched businesses that have produced decades of consumer trust.

Challenges Remain, But GM Is Positioned to Capitalize

The Tesla Model 3 and Model Y are firmly established as the two best-sellers in the U.S. EV market. But despite headwinds from the current administration, GM is well-situated to continue building upon the momentum of its EV success in 2025. 

While EV makers face a slew of challenges for the North American market, including slower rates of adoption, shifting tax credit policy, and margin contraction, those circumstances are not unique to GM. 

In fact, the company finds itself in a place where it can leverage its well-rooted ICE vehicle profitability to help minimize challenges presented by expanding its line of EVs—something that Tesla, Rivian (NASDAQ: RIVN), Lucid (NASDAQ: LICY), or any other all-in EV company is incapable of doing.  

Additionally, the costs of electric batteries for auto manufacturers continue to decrease. From its peak in 2022, the price of lithium has fallen by around 22%. For companies like GM that operate at a massive scale, those supply chain savings will materialize as lower production costs, which could continue to support the affordability of models like the Equinox EV, thereby bolstering its sales as new car prices remain near all-time highs.  

What Wall Street Thinks About General Motors

Of the 23 analysts covering GM, 18 currently assign the stock a Buy rating, while three assign it a Hold rating, and only two assign it a Sell rating.

Overall, GM receives a consensus Moderate Buy rating.

However, analysts’ average 12-month price target of $77.76 implies more than 6% potential downside. 

Still, GM's financial health is in the Green zone, according to TradeSmith. GM has been in this zone for over five months.

Meanwhile, the company scores higher than 85% of companies evaluated by MarketBeat, and ranks 19th out of 85 stocks in the auto/tires/trucks sector. 

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The article "America’s New Favorite EV Isn’t Tesla—and the Stock May Surprise" first appeared on MarketBeat.