TLDR
- Bank of America reinstated “buy” ratings on Ford, General Motors, and Tesla on March 4, 2026
- Ford received a $17 price target (34% upside); GM received $105 (14% upside); Tesla received $460 (14% upside)
- BofA sees both Ford and GM benefiting from a shift away from EVs toward higher-margin trucks and SUVs
- Tesla is rated a buy mainly due to its robotaxi expansion, which BofA estimates makes up ~52% of Tesla’s valuation
- EV sales could fall more than 20% in 2026 as incentives fade and automakers slow their rollout
Bank of America reinstated coverage of the North American auto sector on March 4, 2026, naming Ford, General Motors, and Tesla as its top picks for the year.
Analyst Alexander Perry said the sector could outperform expectations in 2026. He pointed to a changing regulatory environment and a growing focus on gasoline-powered vehicles as key reasons.
Ford received a “buy” rating with a price target of $17. That would represent a 34% upside from its March 4 opening price.
Bank of America said Ford is well-positioned to benefit from the shift in U.S. regulatory policy. The firm expects Ford to focus more on its trucks and SUVs, which carry higher profit margins than electric vehicles.
Ford holds over 30% share in pickup trucks and its F-Series is the top-selling nameplate in the U.S. Ford grew its U.S. market share by 50 basis points in 2025.
General Motors also received a “buy” rating, with a price target of $105 — a 14% upside from its March 4 price. GM is the number one automaker by U.S. market share, at 17.1%.
EVs Take a Back Seat
BofA said both Ford and GM are likely to benefit as the industry pulls back from aggressive EV targets. Heavy EV spending and strict emissions rules had weighed on profits for several years.
The firm estimates that the variable profit per unit for trucks and SUVs is $17,500, compared to a corporate average of $10,000 to $12,000.
BofA expects EV sales to drop more than 20% in 2026 as consumer incentives fade and automakers slow their electric vehicle rollout.
Perry said several companies are delaying or canceling lower-margin EV programs while extending plans for internal combustion engine vehicles.
BofA also noted that the removal of CAFE penalties and greenhouse gas relief are enabling automakers to shift their product mix toward more profitable vehicles.
Tesla’s Robotaxi Play
Tesla received a “buy” rating with a $460 price target, also a 14% upside from March 4. BofA’s case for Tesla is largely built around its autonomous driving business.
The firm expects Tesla to expand its robotaxi services quickly. Tesla’s robotaxis currently operate in San Francisco and Austin, with seven more markets expected in the first half of 2026.
BofA estimates robotaxi accounts for roughly 52% of Tesla’s total valuation. Unlike competitors who use a combination of sensors, cameras, and radar, Tesla uses a camera-only approach which the firm says is cheaper and easier to scale.
Perry also pointed to broader tailwinds for the auto sector. The average U.S. vehicle is now 12.8 years old, and miles driven are at record levels — conditions BofA says could trigger a new vehicle replacement cycle.
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