Auto sales and manufacturers’ profits in Europe have been bounding ahead, but investors worry that a faltering economy and a price war initiated by electric vehicle maker Tesla may also infect the traditional combustion sector and end the positive scenario.
The profitability of high-end manufacturers like BMW, Mercedes and Volkswagen’s Audi and Porsche subsidiaries have benefitted from a combination of events. The shortage of semiconductors may have depressed production, but strong demand has allowed them to sell more highly profitable sedans and SUVs and end up making even higher overall profits. Some mass vehicle manufacturers have followed a similar path, but higher interest rates have weakened demand and the slowing economy is undermining sales.
Support authors and subscribe to content
This is premium stuff. Subscribe to read the entire article.