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General Motors Co. (NYSE: GM) stock is down more than 11% since the United Autoworkers (UAW) strike began on Sept. 15.
That might be bad news for GM shareholders, but it's creating a new opportunity where you'd least expect it.
It has this top electric vehicle stock ready to pop 110%.
This UAW strike is closely tied to GM's expanding electric vehicle production. The company said it would have 20 new electric vehicle (EV) models by 2023. And it needed to make some big changes to get there in time.
Last year, GM CEO Mary Barra announced 14,000 layoffs and the closure of five plants, saying these closures would help GM fund its EV push.
The company might succeed in this at some future date. But the last 20 days have shown us that the transition will be anything but easy.
Electric vehicles are far less complicated to build than gas-powered vehicles. They don't have a combustion engine, so they need fewer parts and fewer people to work on them.
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As a result, UAW predicts the auto industry could cut 35,000 jobs in the switch from gas to electric.
GM is just starting to experience the birth pains of this new industry. But make no mistake, our top EV stock is going to cash in on GM's tough time.
That's because it's a very critical part of the budding electric vehicle industry...
How the Top Electric Vehicle Stock Is Avoiding GM's Fate
An EV future signals a difficult short term for the auto manufacturing industry as a whole.
As engine assemblers give way to battery builders, that means a lot more unhappy ex-auto workers.
It also means that before becoming successful in the electric vehicle market, auto manufacturers' stocks could suffer losses.
That's what we're seeing right now.
This could easily become an industry-wide epidemic. It might not be as drastic as a month-long labor strike. But at the very least, it will manifest as lower earnings for companies throwing money at electric vehicle domination.
While all the tough migration from gas to electric takes place, demand for new cars is also coming to a head. September car sales were down 13% from last year.
GM just missed its Q3 sales growth targets, with smaller-than-desired sales growth of 6.3%. It also posted a 10% year-over-year sales decline.
Right now, GM is one of the first to suffer. The company is paying for its early bid to lead the electric vehicle sector. Other car companies that are late to the EV party might find it even more difficult to sustain their operations.
It's not certain who's going to lead the pack in EV manufacturing just yet. But until that's clear, there will be a flurry of carmakers and unions wrestling with a paradigm shift in the short term.
That's why the best electric vehicle stock right now is going to jump 110% over the next year. It doesn't have to deal with any of that.
The EV Stock to Buy Right Now
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About the Author
Mike Stenger, Associate Editor for Money Morning at Money Map Press, graduated from the Perdue School of Business at Salisbury University. He has combined his degree in Economics with an interest in emerging technologies by finding where tech and finance overlap. Today, he studies the cybersecurity sector, AI, streaming, and the Cloud.