The Automobile Sector

Published on: November 14th, 2019

Cars – if they don’t work, you aren’t going to work. The same is true if the car industry is struggling… global manufacturing will then grind to a halt and the subsequent knock-on effects could be even worse…


  • BF
    Brad F.
    14 November 2019 @ 17:36
    Been itching to put this trade on for ages but after GM surprised in its earnings and caused me some pain I am trigger shy. Need to find a smarter way to put this on with an asymmetric risk reward.
    • RP
      Raoul P. | Founder
      14 November 2019 @ 18:36
      Agreed. Or the macro has to turn properly. We watch and wait...
  • LH
    Luis H.
    15 November 2019 @ 17:20
    Since Americans are buying more expensive cars, mainly at credit, with higher loan rates and increased delinquency the problem is triple
    • LH
      Luis H.
      17 November 2019 @ 11:18
      Another aspect that is impacting the auto industry in my opinion is the shift towards electric cars. The consumer senses the future will be electric, but at present there are not many e-models around, they are expensive and the mileage range is short. So it makes sense to postpone the purchase of a new car.
  • LK
    Lee K.
    19 November 2019 @ 03:43
    I suspect that curious spike in demand in Japan was due to front loading ahead of the increase in consumption tax effective October 2019. (Increase from 8pct to 10pct) driving a significant yoy increase in retail sales across the board. With a population aging this fast, many are opting out of the driving game all together or buying the mini "kei" style cars which are tax efficient but low tech and low value.
  • LM
    Lawrence M.
    19 November 2019 @ 05:22
    I'm still holding a very small HYG short position, to keep it on my radar. If i remember correctly, the original HYG short recommendation, which was some time ago, was in part due to a downgrade of GM bonds. Any consideration in getting back into the short HYG trade?
    • RP
      Raoul P. | Founder
      19 November 2019 @ 12:08
      Im still in it but will need to reset soon. CCC credits are moving and Ford/GM are not stable... but feels like we have to see equity market weakness before it will accelerate and then lead the downside of the cycle.
  • AM
    Aengus M.
    20 November 2019 @ 11:09
    Any comments on Santander Consumer USA Holdings (ticker: SC) ?