Cramer: “This stock is terrifc but…”

Cramer: 'This stock is terriffic but ...'

General Motors announced that it is working on developing a $30,000 long-range electric car to go after Tesla's Model S.

Several years ago, a film titled "Who Killed The Electric Car" accused GM of sabotaging its own electric car efforts (the EV1) in the late 1990s to prove electric vehicles weren't viable.

Times have changed.

Since the late 1990s, oil prices have gone from $12 per barrel to over $105 today. GM's Chevy Volt, a hybrid of gas and electric, has sold 15,000 vehicles this year with the help of government incentives. As well, upstart Tesla's electric-powered Model S (also a beneficiary of government help) is fast becoming the luxury car of choice for those who can plunk down $70,000 to $100,000 for a car without batting an eye.

Oh, and since 2009, one of the biggest shareholders in GM is has been the US government and they're pretty keen on getting electric cars on the road.

Should investors look at today's announcement as a reason to buy GM's stock? Here's what CNBC's Jim Cramer said today on "Squawk on the Street":

"I think GM is a terrific stock. But, those who buy it for this are gravely mistaken. You buy it for a turn in Europe. You buy it for incredible momentum in China. You buy it for the gasoline models. But, everybody wants to be renewable. 'We're renewable. Renewables are all that matters.' No! Earnings matter. GM's got'em."

To be sure, GM's latest quarter's net income was $1.4 billion, down from $1.85 billion the previous year. But, compared to Tesla, it's at least positive; Tesla's one profitable quarter was due to a government subsidy. And, since 2009, revenues have gone from $104.5 billion to $152.3 billion per year.

So, which is the better pick: GM or Tesla?

To answer that, we turn to CNBC contributor Gina Sanchez, founder of Chantico Global, to look at the fundamentals and decide which company she thinks is the better buy. Talking Numbers contributor Richard Ross, Global Technical Strategist for Auerbach Grayson, will decide if the charts agree.

To see what company Sanchez says is the better buy and what Ross' charts say, watch the video above.

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