Question is whether GM will go for it.
Although the idea has been brought up before, creating a Corvette sub-brand is beginning to gather momentum following the debut of the 2021 Ford Mustang Mach-E all-electric crossover. Former GM Vice President of Product Bob Lutz was one of the first to publically push for a new Corvette sub-brand, allowing for the creation of a high-performance SUV, for example. No one from GM has gone on record in favor of the idea (yet), but a new report from Autoblog indicates pursuing this option would be a smart business move. Morgan Stanley analyst Adam Jonas wrote to clients last week that "It's time to look at the potential of GM's supercar brand, Corvette.
Historically the thought of GM expanding Corvette into anything beyond its single-model status would have been brand heresy. But time are changing in global autos." Chances are, GM investors, not to mention GM itself, will find Jonas' financial outlook prediction extremely tempting: Jonas believes a Corvette sub-brand could be worth $7 to $12 billion.
While the C8 Corvette itself would remain the brand's core, a potential all-electric, high-performance SUV featuring the Corvette badge would also be highly profitable. Potentially, it could help propel the Corvette brand to sell 80,000 units per year by the mid-2020s. By the end of the decade, that figure could increase to 100,000. Another model within this sub-brand could be a $150,000+ supercar.
In response to the Morgan Stanley report, a Chevy official told Autoblog "We appreciate everyone's excitement about this iconic brand, but we will not engage in speculation." It would be hard to believe GM CEO Mary Barra is not considering this route. Another example Jonas points out is Ferrari, which was spun off by Fiat Chrysler in 2016.
Ferrari was previously a niche brand within FCA, but former CEO Sergio Marchionne had a greater understanding of the brand's market value. It's now worth around $30 billion. "In essence, we think the Corvette brand is undervalued and under-appreciated by the market," Jonas added. He projects Corvette's current value as $2 billion.
While the Ford Mustang Mach-E represents an expansion of the Mustang line and Ferrari now a publically traded independent company, Jonas recommends a middle of the road approach to create a Corvette brand within GM. Spinning it off, like Ferrari, could also work well, but ultimately the decision rests with GM. There's no reason to doubt Barra and her team are currently examining all possibilities.