Is Amazon a friend or foe of the auto industry? Morgan Stanley isn’t sure


Morgan Stanley’s widely followed auto analyst Adam Jonas is closely watching what Amazon‘s doing in the electric vehicles space, but he hasn’t decided if the online giant will be a friend or foe of those established carmakers like General Motors.

“Watch what Amazon is doing. It really matters… and it raises the question: Is Amazon a potential partner with GM, or a competitor against GM? Both could also be an option,” Jonas said in a note on Wednesday.

Amazon recently invested in two automotive tech firms. It led a $700 million investment in electric vehicle makers, Rivian. The tech giant also invested in a $530 million round of funding for Aurora, a startup developing autonomous systems that could rival those from GM Cruise. The company is already hauling some cargo in self-driving trucks from a startup called Embargo.

Jonas previously said Rivian “clean sheet” approach could make it “the next Tesla.”

The aggressive investments in the automotive startups followed Amazon’s plan to have half of its trips be carbon neutral by 2030, which Jonas said requires “an aggressive adoption” of electric vehicles. Jonas is widely recognized on Wall Street as one of the first to note the significance of Tesla and electric vehicles to the auto industry.

Amazon also has reportedly hired GM’s outgoing executive vice president of global manufacturing, Alicia Boler Davis.

GM’s self-driving car subsidiary, Cruise, reportedly is planning to hire 1,000 more people, mostly engineers, over the next nine months. However, Jonas remains doubtful that self-driving could be a reality anytime soon due to the technological and legal hurdles.

“While GM Cruise is widely seen as a leader in AVs, we do not believe the human safety driver can be removed from any appreciable amount of fleet for many years… if not more than a decade,” Jonas said.

— With reporting from Michael Sheetz

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