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Frustrated GM investors ask what more Mary Barra can do

DETROIT — General Motors Co Chief Executive Mary Barra has transformed the No. 1 U.S. automaker in her almost five years in charge, but that is still not enough to satisfy investors. Ahead of third-quarter results due on Oct. 31, GM shares are trading about 6 percent below the $33 per share price at which they launched in 2010 in a post-bankruptcy initial public offering. The Detroit carmaker's stock is down 22 percent since Barra took over in January 2014. After hitting an all-time high of $46.48 on Oct. 24, 2017, the shares have declined 33 percent. In the same period, the Standard & Poor's 500 index has climbed 7.8 percent. Several shareholders contacted by Reuters said GM could face a third major action by activist shareholders in less than four years if the share price does not improve. "I've been expecting it," said John Levin, chairman of Levin Capital Strategies. "It just seems a tempting morsel to somebody." Levin's firm owns more than seven million GM shares. Barra has guided the company through the settlement of a federal criminal probe of a mishandled safety recall, sold off money-losing European operations, and returned $25 billion to shareholders through dividends and stock buybacks from 2012 through 2017. GM declined to comment for this story, but the company's executives privately express frustration with the market's reluctance to see it as anything more than a manufacturer tied mainly to auto market sales cycles. GM's profitable North American truck and SUV business and its money-making China operations are valued at just $14 billion, excluding the value of GM's stake in its $14.6 billion Cruise automated vehicle business and its cash reserves from its $44 billion market capitalization. The recent slump in the Chinese market, GM's largest, and plateauing U.S. demand are ratcheting up the pressure. GM is one of the few global automakers without a founding family or a government to serve as a bulwark against corporate raiders. In 2015, a group led by investor Harry Wilson pressed GM to launch a $5 billion share buyback, and commit to what is now an $18 billion ceiling on the level of cash the company would hold. In 2017, GM fended off a call by hedge fund manager David Einhorn to split its common stock shares into two classes. Einhorn, whose firm still owned more than 21 million shares at the end of June, declined to comment about GM's stock price. Other investors said there were no clear alternatives to Barra's approach.

Wagons make a bit of a comeback, with new models, sales on the rise

Consider this an official invitation to hop on the wagon bandwagon. There's still tons of room because, well, it's a wagon (and market share is still extremely small). But according to new data, the segment is growing. According to a report from Bloomberg, using data from Edmunds.com, roughly 211,600 Americans purchased wagons in 2018. That is technically down from the 237,600 sold in 2017, but wagon sales in the U.S. are up 29 percent from where they were five years ago. It's also the third year in a row that wagon sales broke the 200,000 mark. The sales trends have been somewhat representative of the availability of wagons. New models have debuted during the past 5 years and therefore offer more opportunity at more brands to buy wagons. In addition to more modest cars such as the Volkswagen Golf Sportwagen, several luxury and performance brands are offering wagons today, such as Mercedes-Benz, Audi, Porsche, Jaguar, Volvo and Buick. (Bloomberg's headlines make the point that "crossovers are for the Kardashians," and wagons are just, well, classier.) This uptick in brand-name availability, as well as extremely well-executed design on most of the wagons currently available, has helped increase the segment's desirability. That, and its ability to better accomplish the same tasks at hand while standing out from the crossover and SUV crowd. Still, the posted numbers represent a small fraction of the total vehicles sold. According to the data, wagons only held a 1.4 percent market share in 2017, the segment's best recent year. Wagons hold a steadfast place in America's past, and they're writing an interesting new story. With the downturn in traditional cars, they may continue to create an unexpected narrative. Related Video: News Source: Bloomberg, Edmunds Audi BMW Buick Volkswagen Volvo Wagon station wagon

10 of 18 midsize SUVs earn 'good' IIHS side impact safety rating

It's not terribly surprising that midsize SUVs earned better safety ratings than small SUVs in the latest side-impact tests performed by the Insurance Institute for Highway Safety (IIHS). Just how much better they scored, on the other hand, certainly raises an eyebrow. Ten out of 18 midsize SUVs earned the highest rating of 'good' in the stringent new test, altered for vehicles starting with the 2020 model year with a heavier barrier (4,200 pounds) that moves at a higher speed (37 miles per hour) and is fitted with a hard honeycomb frontal structure. By way of contrast, just one out of of 20 small SUVs earned a 'good' score.  SUVs that receiving 'good' scores were the Ford Explorer, Infiniti QX60, Lincoln Aviator, Mazda CX-9, Nissan Pathfinder, Subaru Ascent, Toyota Highlander, Volkswagen Atlas, Volkswagen Atlas Cross Sport and Volkswagen ID.4. For EV fans, it's worth noting the ID.4 was the only electric vehicle included in the test. The Buick Enclave and Chevrolet Traverse scraped away with 'acceptable' ratings while the Honda Passport, Honda Pilot, Hyundai Palisade, Jeep Wrangler 4-door, Kia Telluride and Nissan Murano were deemed merely 'marginal' in the tough new test. Only two models — the Mazda CX-9 and Volkswagen ID.4 — earned a "Good" rating in every test category.  Interestingly, the Jeep Wrangler would have scored a 'good' rating if it were equipped with side airbags for the rear seating positions. It would likely be an engineering challenge to equip its removable top and/or doors with airbags, but the lack of that safety feature allowed the head of the rear passenger dummy to hit the vertical support of the top. Otherwise, the Wrangler scored good ratings across the board. The new Ford Bronco, which makes more allowances for side-impact safety, has not yet been tested.  The popular Hyundai Palisade and Kia Telluride SUVs stand out in the test with 'poor' ratings for driver pelvis injuries. The Nissan Murano, a vehicle last redesigned for the 2015 model year, was the only vehicle tested that received a 'poor' rating for its structure and safety cage. Videos of the tests of 12 of these 18 SUVs can be found on the IIHS' YouTube page. Related video: Green Buick Chevrolet Ford Honda Hyundai Infiniti Jeep Kia Mazda Nissan Subaru Toyota Volkswagen Safety Crossover SUV IIHS Insurance Institute for Highway Safety