10 auto companies facing worst declines due to global chip shortage

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In this article, we discuss the 10 automakers facing the worst declines amid a global chip shortage. If you wish to ignore our detailed analysis of these stocks, go directly to the 5 auto companies facing worst declines due to global chip shortage.

The current shortage of semiconductor chips has had a huge impact on the global automotive industry which uses these chips in the production of vehicles, both traditional and electric. A blow in production and sales due to the shortage of chips will likely be Cost the auto industry $ 110 billion this year, according to a report by consulting firm AlixPartners. The forecast, up from $ 60 billion in losses expected in January this year, has been revised after a fire at a major chipmaker in Japan and increased semiconductor supply chain problems.

AlixPartners predicts that the global auto industry will produce 3.9 million fewer vehicles this year due to the chip crisis. However, IHS Markit, a London-based business intelligence firm, waits this number can reach 7 million. US President Joe Biden, who championed a new plan to revive American manufacturing during his tenure, has affected over $ 50 billion for US-based chipmakers. He also commissioned a review of US supply chains to assess the problems faced by US automakers in this regard.

Some of the major auto companies facing the worst declines amid the global chip shortage include General Motors Company (NYSE:DG), Tesla, Inc. (NASDAQ:TSLA) and Ford Motor Company (NYSE:F), among others discussed in detail below. The chip crisis began during the pandemic when lockdown protocols resulted in the closure of some chip manufacturing plants. As the economy reopened at the end of the year, increased demand for crisps exacerbated the crisis, pushing prices to new heights and affecting supply chains.

The rise in semiconductor prices has also affected other sectors of the economy, notably the world of finance. The technological disruption of the auto industry, which was happening at an electric speed, was hit. The entire hedge fund industry is feeling the impact of the changing financial landscape. Its reputation has been tarnished over the past decade, during which its hedged returns have failed to keep up with the unhedged returns of market indices. On the other hand, Insider Monkey’s research has identified in advance a select group of hedge funds that have outperformed S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021 , stock picks from our monthly newsletter returned 186.1%, compared to 100.1% for SPY. Our stock picks outperformed the market by over 86 percentage points (see details here). This is why we believe that hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can sign up for our free newsletter on our homepage to get our stories delivered to your inbox.

10 auto companies facing worst declines due to global chip shortage

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Our methodology

In that context, here is our list of the 10 automakers facing the worst declines amid a global chip shortage. Only automakers who announced layoffs or cutbacks in sales, deliveries and production due to the chip shortage were selected. Companies that forecast lower profits due to the shortage were also included.

The list is established according to the number of hedge fund holders in each company. Data from the 873 funds tracked by Insider Monkey was used for this purpose.

Particular emphasis has been placed on basic business fundamentals and analyst ratings for each company to provide readers with some context so they can make more informed investment choices.

Auto companies face worst declines due to global chip shortage

10. Subaru Corporation (OTC: FUJHY)

Number of hedge fund holders: N / A

Subaru Corporation (OTC: FUJHY) is ranked tenth on our list of the 10 automakers facing the worst declines due to the global chip shortage. The company manufactures and sells automobiles and is headquartered in Japan. In January of this year, the company announced that it would cut production by several thousand in the United States and Japan due to the chip shortage. The shortage affected car production at the company’s Gunma plant. Production at the plant was also halted for two days due to the chip crisis, a company spokesperson told the news agency. Reuters this month.

Subaru Corporation (OTC: FUJHY) has a market capitalization of $ 14 billion. It posted a profit of 765 million euros in the previous financial year. Sales over the period amounted to 28 billion euros, down more than 15% over one year.

Just like General Motors Company (NYSE: GM), Tesla, Inc. (NASDAQ: TSLA) and Ford Motor Company (NYSE: F), Subaru Corporation (OTC: FUJHY) is one of the stocks that suffers a shortage of chips. .

9. Mazda Motor Corporation (OTC: MZDAY)

Number of hedge fund holders: N / A

Mazda Motor Corporation (OTC: MZDAY) is ranked ninth on our list of the 10 automakers facing the worst declines due to the global chip shortage. The company is engaged in the manufacture and sale of passenger cars. It is headquartered in Japan. In May, the automaker announced that the chip shortage is expected to affect 100,000 Mazda cars this year. In a statement, the company said it will try to minimize the impact of the crisis to around 70,000 vehicles. The company plans to make full use of available inventory for this purpose.

Mazda Motor Corporation (OTC: MZDAY) has a market capitalization of over $ 5 billion. The company was founded in 1920 and employs nearly 50,000 people. Some of the products it sells include four-wheelers, gasoline and diesel engines, and transmissions.

Along with General Motors Company (NYSE: GM), Tesla, Inc. (NASDAQ: TSLA) and Ford Motor Company (NYSE: F), Mazda Motor Corporation (OTC: MZDAY) is one of the companies affected by the global chip shortage . .

8. Canoo Inc. (NASDAQ:GOEV)

Number of hedge fund holders: 16

Canoo Inc. (NASDAQ: GOEV) is a California-based company that manufactures and sells consumer and commercial electric vehicles. It is ranked eighth on our list of the 10 automakers facing the worst declines due to the global chip shortage. At the end of July, Canoo’s CTO Peter Savagian told reporters Business intern that the company had the shortage of chips on the radar and was actively positioning itself to avoid the possible impact this would have on electric vehicle production.

On September 7, investment adviser HC Wainwright launched stock coverage of Canoo Inc. (NASDAQ: GOEV) with a buy rating and a price target of $ 15, noting that the company was well positioned to capitalize on growth in the electric vehicle market.

At the end of the second quarter of 2021, 16 hedge funds in Insider Monkey’s database had $ 37 million in holdings in Canoo Inc. (NASDAQ: GOEV), the same as in the previous quarter of ‘worth $ 14 million.

In addition to General Motors Company (NYSE: GM), Tesla, Inc. (NASDAQ: TSLA) and Ford Motor Company (NYSE: F), Canoo Inc. (NASDAQ: GOEV) is one of the companies facing a drop in production amid a global shortage of chips.

7. Fisker Inc. (NYSE:RSF)

Number of hedge fund holders: 16

Fisker Inc. (NYSE: FSR) is a California-based company that designs, manufactures and markets electric vehicles. It is ranked seventh on our list of the 10 automakers facing the worst declines due to the global chip shortage. The stock’s value has fallen 29% in the past three months as the chip shortage hits the industry. Fisker recently evaluated a green convertible note offering for $ 625 million. The company has also signed an agreement with Magna International in connection with planning the production of new models.

On August 9, investment advisor Morgan Stanley resumed coverage of Fisker Inc. (NYSE: FSR) stock with an overweight rating and a price target of $ 40, calling the company a “de-SPAC la” startup. top rated ”in the electric vehicle space.

At the end of the second quarter of 2021, 16 hedge funds in Insider Monkey’s database had $ 256 million in Fisker Inc. (NYSE: FSR) stakes, up from 22 in the previous quarter of a worth $ 337 million.

General Motors Company (NYSE: GM), Tesla, Inc. (NASDAQ: TSLA) and Ford Motor Company (NYSE: F) are some of the automakers affected by a chip shortage around the world, along with Fisker Inc. (NYSE : FSR).

6. Li Auto Inc. (NASDAQ:LI)

Number of hedge fund holders: 20

Li Auto Inc. (NASDAQ: LI) is ranked sixth on our list of the 10 automakers facing the worst declines due to the global chip shortage. The company manufactures and sells intelligent sport utility vehicles and is headquartered in China. The share’s value has fallen more than 7% since the start of this week after the company said it would cut its guidance for third-quarter deliveries to 24,500 from around 26,000 due to the crisis in the shortage of chips. The correction means the company plans to deliver 6,500 vehicles in September, down 30% month-on-month.

On August 31, investment advisory firm Bank of America maintained a buy rating on shares of Li Auto Inc. (NASDAQ: LI) and raised the price target to $ 42 from $ 39, appreciating Company’s second quarter results and third quarter forecast.

At the end of the second quarter of 2021, 20 hedge funds in Insider Monkey’s database had $ 457 million in stakes in Li Auto Inc. (NASDAQ: LI), up from 18 in the previous quarter of worth $ 493 million.

General Motors Company (NYSE: GM), Tesla, Inc. (NASDAQ: TSLA), and Ford Motor Company (NYSE: F) have all reported production issues due to a shortage of chips, as has Li Auto Inc. ( NASDAQ: LI).

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Disclosure. Nothing. 10 auto companies facing worst declines due to global chip shortage was originally published on Insider Monkey.

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