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UPDATE: Morgan Stanley Reiterates On General Motors On US Dealer Franchise Laws

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In a report published Thursday, Morgan Stanley analyst Adam Jonas reiterated an Underweight rating on General Motors (NYSE: GM), but removed the $33.00 price target.

In the report, Morgan Stanley noted, “Life's already hard enough for the D3. Antiquated US franchise laws make it harder for GM and F to provide best execution for their customers. Tesla's quest to own its own stores has brought to light issues that have long faced the industry. On June 16th, the New Jersey Assembly approved legislation allowing Tesla to own 4 stores in the state. This passed by unanimous vote of 77 to 0 (1 abstention).

"As TSLA grows in significance and expands its sales network, we expect more debate (at the Federal level) on the double-standard in the application of dealer franchise laws. Tesla is the only OEM that can truly control the customer experience at its stores, while all others are prevented by law. We see this is a major advantage for TSLA and a disadvantage for all others. To be clear, we see the franchise model as superior for the vast majority of US vehicle sales with no law required to enforce it.”

General Motors closed on Wednesday at $37.09.

Latest Ratings for GM

DateFirmActionFromTo
Aug 2019MaintainsBuy
Jun 2019Initiates Coverage OnOutperform
Feb 2019Initiates Coverage OnBuy

View More Analyst Ratings for GM
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