Consumer Discretionary Sector Junior Junior Analysts: Senior Analyst: Sector Head: GM) (NYSE: Lauren Lauren Levine Patrick Sickler Brandon Wexler Eric Cassar Amanda Luong BUY: GM Price Target:Price $71 Upside: 20% Consumer Discretionary Sector • Company Overview • • -30% -20% -10% GM International (GMI) brands likewith ,GM International ,GMC, , and Brands As GM’sa multinationalcorporation, automotive is segment dividedAmerica (GMNA) GM into North and crossovers, customers for consumer retail fleet and and automobile parts General MotorsAmerican is the automobilelargest manufacturer that designs and sells cars, trucks, contribute to a$2.2B investment its self electric for furthering is General Motors’ autonomous GM vehicle Cruise that has Microsoft segment Corporation had recently 10% 20% 30% 40% 0% 3/12/2018 3 Year Historic Performance 9/12/2018 3/12/2019 March 15,2021 March GM 9/12/2019 XLY S&P 500 S&P 3/12/2020 9/12/2020 2 - driving services GMNA GM Buy: 0.1% 0.3% Revenue Breakdown GMI 9.5% 11.3% Corporate Target: $71 78.9% Cruise GM Financial Upside: 20% Consumer Discretionary Sector Industry Analysis Industry • • • Vehicles (In Millions) 100 120 WesternEurope 20 40 60 80 dioxide sustainability emissions and increase carbon global as a way mitigate to industry vehiclesthe electric propel continue to of expansion The 2025 reach to 5.76% $28.5B byof end the a CAGRat grow to is expected automotiveGlobal of industry $953B each sales automotiveyear through and servicing generates The industry 0 • • • Global Motor VehicleProduction 2010 EV sales will increase 36%will increasesales EV expected rise to byNew carsales in 202115% through 7.22%2025 Americanautomotive North market expectedCAGR a to at grow of 2011 EasternEurope 2012 March 15,2021 March 2013 Asia 2014 Latin Latin America 2015 2016 North America yoy 2017 to 3.4M units in 2021units 3.4Mto 2018 Other 2019 3 Rep. of Rep. Korea UnitedStates Consumer Next Preferences for Vehicle Germany China Japan India Gasoline/Diesel 0% GM Buy: 10% 20% HybridElectric 30% 40% Target: $71 50% Battery ElectricBattery Vehicle 60% 70% 80% Upside: 20% Other 90% 100% Consumer Discretionary Sector Investment Thesis • • • (2.3% UW) (2.3% BIF: 10.0% BIF: Strong Consumer Sentiment in both the US bythe propelled Consumer and both ChinaStrong Biden’s in Sentiment contributing sustainability plan, EV Revolution provides opportunities strong and outlookgrowth Robust Profitability and strength of existing product product incl.crossovers,offerings existing trucks, and brand Cadillac Robust and strength of Profitability to GM’s valuehigh proposition • • • 0nwgoa lcrcvhce y22 eeomn fnew 30global electricvehicles by& development2025 of Future of autonomous vehicles boosts outlook further of Future Strong margin balanceimprovementssheet andEBIT position GM wellfor future success 3% TGT CD Allocation March 15,2021 March 7% 47% AMZN 8% QSR ULTA 35% DHI Buy GM 4 Brightdrop MarketCapitalization 52 Week52 High/Low FWD EV/EBIT 2020 Revenue2020 EPS GM Buy: Key Statistics Key Target: $71 $59.62/$14.32 $85.39 bn $85.39 bn $122.5 8.15x $4.90 Upside: 20% Consumer Discretionary Sector #1: EV Revolution • • • • • • 10 15 20 25 30 35 0 5 Plans to devote over 50% of product development product team to Plans devoteover of 50% New models willNew models include theCadillac Will spend overbillion$27 in thistransition Allfacilities powered byby renewable 2035 energy Exclusivelyoffer electricvehicles by 2035 by30new global EVmodels 2025 to electric vehicleand autonomous programs Celestiq 2015 Global(in EVSales 2016 , GMC , GMC and Bolt Chevy, 2017 2018 March 15,2021 March GM’s EV Plans 2019 2020 2.6 2021E Catalyst #2 Catalyst 2022E mns 2023E Lyriq funits) of 2024E , Cadillac , 2025E 2026E 2027E 29.5 • • • • • $120 $160 $40 $80 $0 Can add add Canrevenue licensingthrough streams technology overRange chargemilesper400 accelerationmph 0 to low60as in 3 seconds as Allowsfor massive scalability at reduced costs & flexibility packhorizontallyinside battery Large to others • Industry Average Industry - each vehicle design and layoutstorage for energy battery Allows optimization of format, pouch format, GM $137 Buy: Battery Advantages Battery Ultium - style cellsbe canstacked verticallyor Tesla Target: $115 $71 Battery 44% cheaper GM 2024 GM $95 Upside: 20% ($/kWh Cost Battery ) Consumer Discretionary Sector • 1: EVRevolution • • • Partnership with FedEx already secured,will receivetheir first 500 in delivery vehicles in world’sthe top 100 cities Demandfor urban last Designed to help businesses lower costs, maximize productivity and improve employee safety through sustainable practices electricproducts, software, and services New GM startup, officially launched Jan. 12, 2021, focuses on improving using an systemof integrated delivery services $100 $200 $300 $400 $500 $600 $700 $800 $900 $- • Global ParcelMarketDelivery (in intervention Urban delivery toexpected add 11 minutes to daily commute and increase carbon emissions by by 30% 2030 without effective 2018 2019 March 15,2021 March 2020 550 - mile mile delivery, fueled by ecommerce, expectedto78% grow by which 2030 will lead to a 36% increase 2021 Catalyst #2 Catalyst 2022 2023 2024 bns 2025 771 ) 6 BrightDrop Urbanization population bypopulation 60% 2030 of vehicles in mid GM Buy: online in 2021 in online Delivery StatisticsDelivery of CO of Customers Customers expected to 2.1 buy goods buy goods billion billion 2 emissionsfrom delivery - 11% late 2021 late Target: $71 expected from Same 2021 20.7% CAGR - - 2027 Day population by population Upside: 55% Wil reachWil Grocery Grocery 20% 2024 of of Consumer Discretionary Sector 1: EVRevolution Electrically poweredElectrically motorized box helps that handle short handle March 15,2021 March - distance distance parcel transport EP1 7 Electric light Electric GM Buy: long - - distance delivery delivery distance purpose vehiclefor built purpose EV600 Target: $71 Upside: 20% Consumer Discretionary Sector 2: Strong Consumer2: Strong Sentiment Cumulative(Thousands) 2020 EV Sales Through • • • • UnitedKingdom UnitedStates Netherlands vehiclesupplierin the world China the numberas one US surpasses Goal: electric annual(3.7%Auto increasesthrough 2025)Industry Stricter efficiencyto be standards placed on US to Plans spend $2trillion overnext 4years by through infrastructure renewable2050 energy achievingBidenAimedat Plan: net Germany Norway Sweden France China Japan 0 218 500 297 334 450 470 498 700 PoliticalInitiatives 1000 March 15,2021 March 1500 2000 1786 2500 3000 - 3500 zero emissions 4000 4500 4710 5000 100,000 200,000 300,000 400,000 500,000 • • • • Over 170 firms & 77 countriesGoal” set the & 77“2050 Overfirms 170 investchargingin EV infrastructure Americans nowtheir state to support 67%of public chargingfast largest network GM & CAGR through 2028 marketat 36% charginggrow to EV infrastructure 0 90,000 2020 EV Infrastructure & Societal Support & Societal EV Infrastructure EVgo Biden Charging NetworkPlan Charging Biden GM 2021 Buy: 2022 will partner to triple size of the to of triplesize partner will 2023 2024 Target: $71 2025 2026 2027 2028 Upside: 20% 2029 500,000 2030 Consumer Discretionary Sector :#o Charging StationsPer State 2: #of March 15,2021 March GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector 1000 1250 1500 1750 $B 3: RobustProfitability 750 • • • • • • EBIT margin hasbeenEBIT increasingsince steadily 2018 GM announcedwithHonda their scale AVs partnership mass to a driving vehicles to Microsoft enhance self and commercializeAzura byhelp of GM vehicles 222023, includewillSuper Cruise vehiclesmarket preference and luxury MPVs for large in China, especiallynewRise insalesSUVs, YOY)56%Cadillac(up and Buick(upYOY),28% d YOY Largest in sinceTrucksSizedFullUS market1990 share gain & SUVS Full 2019 - Sized Pickupin the Leader SizedSalesUnited States 2020 March 15,2021 March 2021 AV Industry 2022 2023 2024 2025 -1.0 $B 0.0 1.0 2.0 3.0 4.0 Q4 2019 GM Buy: Operating Profit Turnaround Profit Operating Q1 2020 Q2 2020 Target: $71 ue to to ue an increasing Q3 2020 Upside: Q4 2020 20% 0.0 10.0 20.0 30.0 40.0 50.0 Consumer Discretionary Sector 3: ValueProposition YOYGrowthSales *As of Q4 2020 of *As Cars Sold Cars Sold (2020) EBIT Margin EBIT Price Salesto FCF(2020) ROIC March 15,2021 March General Motors General 2.69% 9.9% 2.9M 5.0% 9.5B .63 - - 2.72% 12.5% Ford 2.1M 4.8% 7.9B .38 GM Buy: Honda 1.71% - 4.8M 4.0% 5.7B 8.9% .40 Target: $71 5.08% Tesla 25.51 5.4% 1.9B 46% .5M Upside: 20% Consumer Discretionary Sector Other Initiatives:Hydrogen • • • • station station in <5minutes renewablesfallcould Costs of producing Costs of traditional gasoline traditional gasoline majority focused on transport Growingtargets, ~50 mandates,support: and policy incentives in todayplacehydrogen, directly that support with GM’sproduct offerings, diversityIncreases whichof provides to competitive sustainability edge be rolledout in 2024 for partnership long Navistar Feb. Announcement 2021:of Hydrogen Cell:FuelCombines hydrogen and oxygen to produce electricityw/water& byproducts heat as hydrogen from Can refuelat a • 30% by30% 2030 Benefits of Hydrogen Cells Fuel of Benefits In infant stages: infrastructure is small but growing is small infrastructure In infant stages: March 15,2021 March EU will investEU in $430B 25% efficiency of gas efficiency25% of efficient compared to goals of Green Deal of goals 2030 to to help achieve2030 green hydrogengreen by 40 powered cars - 60% energy energy 60% - - haul trucks using GM’susing haul trucks 1,000 2,000 3,000 4,000 5,000 6,000 0 HydrogenCell FuelMarket Size (in 2019 GM Buy: 2020 2021 Hydrotec 2022 Target: $71 fuelcellpower to cubes 2023 2024 Upside: 20% 2025 mns ) 2026 Consumer Discretionary Sector Valuation DCF Terminal Multiple DCF DCF GordonGrowth DCF FWD EV/EBITDA FWD 52 Week High/Low 52 Week FWD EV/EBIT FWD Analyst PT Analyst FWD P/E FWD March 15,2021 March $0 $20 $40 $60 $80 $100 • • • GM Buy: Terminal Growth 1.5%Rate: Terminal EV/EBIT:18x WACC: 5.2% SensitivityAnalyses Assumptions Target: $71 Upside: 20% Consumer Discretionary Sector ESG Analysis employee misconduct Awareline Energy Consumption Energy Improvements Implementation of Implementation of reporting 2018: system for system March 15,2021 March transparent transparent company on on S&P for ESG Named 4 Named disclosure 2018: th most performance; A in performance; Received A climate change watersecurity 14 2019: - on Waste Improvements Management Employee Gender Improvements Appointment of GM’s Appointment of GM Sustainability Sustainability Officer, Buy: Dane ParkerDane first Chief Chief first 2020: Target: $71 support organizations organizations support promoting promoting DEI, $1M Pledge of $10M $10M to of Pledge to NAACP 2020: Upside: 20% Consumer Discretionary Sector Risks and Risks Mitigants Semiconductor chip shortage shortage chip Semiconductor does not pan out as expectedout pan not does popularity & consumption popularity High leverage on balance on leverage High High momentum of EV of momentum High March 15,2021 March sheet weighs on firm’s firm’s on weighssheet drivescostsup margins

Severity Severity Severity Probability Probability Probability 15 future plans; stableplans; in play future EV ProactiveinvestmentsR&D in outlook for pickups & SUVs pickups for outlook offerings show viability for offerings GM decreasing for past 3 yearspast 3 for decreasing for EVs are the cause; Net cause; the EVsare for Biden’s100 improvestill segment; on Buy: track to meet production production to meet track Debt/EBITDAbeen has Existing EVs product EVsproduct Existing an EV an “bubble” - day review to review day Target: $71 Upside: 20% Consumer Discretionary Sector Thank YouThank March 15,2021 March Questions? Probability 16 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector A. Appendix H. G. F. E. D. C. B. DCF WACC Comps Analysis NWC Revenue Build Cash FlowStatement Balance Sheet Statement Income March 15,2021 March 17 O. N. M. L. K. J. I. datgso Advantages of Public andPrivate Stations Charging Stations EVs Charging to Ratio of Biden’s 100 Day Review Other Initiatives: GMDefense Policy Hydrogen Development Support: Policy: International Hydrogen GM Buy: Hydrotec Target: $71 Upside: 20% Consumer Discretionary Sector A: Income Statement March 15,2021 March 18 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector B: Balance Sheet March 15,2021 March 19 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector C: CashStatementFlow March 15,2021 March 20 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector D: Revenue Build March 15,2021 March 21 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector E: NWC March 15,2021 March 22 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector F: Comparable Companies March 15,2021 March 23 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector G: WACC March 15,2021 March 24 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector H: DCF March 15,2021 March 25 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector I: International Policy: HydrogenI: International March 15,2021 March 26 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector J:Policy Support: March 15,2021 March HydrogenDevelopment 27 GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector K: Other Initiatives: GM Defense • • Army Army SquadVehiclesbuild Infantry for US June 2020:Won $214M to contract technologies unit in2017 to showcasefuel defense military Quiet relaunch of • • • trucks overtrucks next decade the the approvedbeen to acquire 2,065 of has next 5 years), already but Army spread tobe (distribution out over the paysContract forfirst 649 vehicles commercial off Vehicle 90%be made with will cell technologiesyet is there for notfuel that infrastructure products military,the for but recognizes Sees a $25B market new in creating March 15,2021 March - the - shelf parts shelf - cell - GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector L: Biden’s 100 Day Review March 15,2021 March GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector :Rtoo EVs to Charging Stations of M: Ratio March 15,2021 March GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector N: Public & Private Charging Stations March 15,2021 March GM Buy: Target: $71 Upside: 20% Consumer Discretionary Sector :Avnae fAdvantagesO: of March 15,2021 March Hydrotec GM Buy: Target: $71 Upside: 20%