This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

General Motors vs. Ford: Calling a Winner

NEW YORK (TheStreet) -- Related companies are a common comparison. Look at Mastercard (MA) and Visa (V), Nike (NKE) and Under Armour (UA), or in this case, Ford (F) and General Motors (GM)

While it would be easy to compare the companies' earnings per share growth or revenue models all night, it wouldn't be very helpful. Investors can do that on their own and it takes all of five minutes to figure out. 

In this case, there's one glaring obstacle that makes comparing the two companies all the more difficult: General Motors' recent bankruptcy. 

GM's 2009 Chapter 11 bankruptcy filing marked the low point for the U.S. auto industry. Unlike GM and Chrysler, Ford was able to stave off bankruptcy under CEO Alan Mulally's effective leadership -- but only barely, as the stock price traded down to roughly $1 per share. 

Shares of Ford have been incredibly strong this year, and admittedly, I've been quite bullish. But what about its Detroit brethren? 

When you consider that General Motors sold 9.29 million vehicles in 2012, second only to Toyota Motors' (TM) 9.75 million, it seems odd that Ford is generally heralded over GM. For what it's worth, GM took home the crown for top seller in the year prior, in 2011. 

Part of what likely helped GM gain so many auto sales in the past -- it was the reigning top auto seller for eight decades until 2008 -- was the amount of brands it used to own, like SAAB, Hummer, and Pontiac (the list goes on for a while).

Presently, it's been pulling home a large piece of the U.S. domestic sales pie. Year-to-date, General Motors holds 18% of U.S. auto sales, besting Ford by 2%. Its 2.34 million auto sales also trump Ford's 2.08 million units.


Brand to Brand

For the record, though, as far as individual brands go (rather than by company), Ford is the top-selling name in the states for 2013, as well as in 2012. It also boasts the top-selling vehicle, the F-Series truck. Of course, it only makes sense that the Chevy Silverado is in second.

There's another important consideration when it comes to brand: Luxury. 

Each company has its own luxury line. General Motors has Cadillac and Ford has Lincoln. To be frank, the latter is getting its ass kicked by the former, plain and simple. 

Year-to-date, Cadillac has sold 148,200 units, more than double Lincoln's 66,980. Mulally is making a point to fix Lincoln's luxury image, but so far, the sentiment hasn't shifted much. 

Although Lincoln's sales for the month of October increased 38% year-over-year, the brand is still lagging its total sales in 2012 of 82,150 vehicles. Even if it does best those numbers by year-end, annual sales growth will only be flat, or near flat, for 2013.

Compare this to Cadillac, which grew October sales 9.5% from last year, and is within 1,000 units of matching 2012's total figures (after only 10 months this year). Buick, another General Motors brand, has also done fairly well, selling just north of 175,000 units this year. 

Cadillac is flat out owning Lincoln, and that's hard to argue with.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,172.68 -107.06 -0.62%
S&P 500 1,994.29 -16.11 -0.80%
NASDAQ 4,527.6890 -52.10 -1.14%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs