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Investors sold after the investment bank's analysts warned about what they called the 'China butterfly effect':
Shares of General Motors and Ford Motor traded lower on Wednesday after Morgan Stanley downgraded the overall U.S. auto sector, citing worries that Western automakers might struggle in the intensifying competition with Chinese rivals.
General Motors was downgraded to "underweight" from "equal weight," and its shares fell 5.4 percentage points, to $45.50. Ford went to "equal weight" from "overweight," with its shares dropping more than 4 percentage points, to $10.43.
Electric vehicle (EV) maker Rivian Automotive and Canadian parts manufacturer Magna International were both downgraded to "equal weight" from "overweight." Shares of Rivian were down 5.7 percentage points while Magna's were off 4.7 percentage points.
Investors sold after Morgan Stanley analysts warned about what they called the "China butterfly effect," a metaphor suggesting that even small surges in China's industrial production capacity could have significant ripple effects across the global market.
[...] Bolstered in part by massive government subsidies, Chinese manufacturers have rapidly emerged as major players in the EV industry, accounting for 60 percent of worldwide EV sales and almost one in five EVs sold in Europe last year.
Both Washington and Brussels have hiked tariffs in response to China's excess production of low-price EVs.
Previously:
- VW Turns on Germany as China Targets Europe's EV Blunders
- Auto Woes
- Chinese Automaker Zotye Plans 2020 Entrance into the U.S. Market
(Score: 0) by Anonymous Coward on Saturday September 28 2024, @11:41PM (2 children)
So far no charges have been filed...
(Score: 3, Insightful) by Rosco P. Coltrane on Sunday September 29 2024, @07:59AM (1 child)
If you express an opinion and the market listens to you to such an extent that you have an immense impact on the entire economy, it can't possibly be your fault.
It becomes criminal when someone pays you to express an opinion.
Do you have proof that Morgan Stanley sells their influence for money? I mean I wouldn't be surprised: they've been found to be on the wrong end of unlawful shenanigan so many times it's even surprising that they're still allowed to be around. But you make a pretty specific accusation that requires equally specific proof.
(Score: 1, Insightful) by Anonymous Coward on Sunday September 29 2024, @06:35PM
This is their primary business, like any other broker. This is how they build up clientele with the biggest investors in town. Plus they, Warren Buffet, and all their cronies buy and sell enough stock themselves to have a big influence on the market. That's how they make their money. When they do well, people want in, pay a small commission, and Bob's your uncle. Nothing abnormal about it. Just remember, these are the same people that cause inflation and recession with all that free money they get from the fed, all legally apparently, because nobody is in jail for it. Regardless of the legalities, there is nothing about the stock market anybody could call "ethical". It is a casino that has undue effect on the economy at large
(Score: 1, Interesting) by Anonymous Coward on Sunday September 29 2024, @12:35AM (1 child)
If you have plenty of stomach for risk, automotive is the corner of the stock market for you!
Look here, https://www.morningstar.ca/ca/news/246817/why-is-gm-stock-so-cheap.aspx [morningstar.ca]
Back in March 2024, GM was touted as cheap and they were seen as the next electric car success story.
A year ago (Oct 2023) is when Cruise had to stop all their service in SF, due to running over and dragging a pedestrian. Kind of funny to see that Morningstar has forgotten all about that by 3/2024.
(Score: 5, Interesting) by DrkShadow on Sunday September 29 2024, @04:24AM
If they're getting $1 billion from Cruise, they're counting money from other units and not deducting development costs. Cruise isn't successful, and their hope to have huge income from it by 2030 means they're _planning_ on having full-autonomous driving, and planning that every other vendor *will not*. The plan would basically also necessitate that no one owns a vehicle and uses their service, by 2030. Nuhhh...
They're telling you what to expect: the GM stock is going to be utterly flat, and perhaps around 2029 they're going to go through a reconning. Most likely they'll update those numbers in 2027 - 2028, because.. not a chance.
Back when I got my first AV ride in 2018, I was like, "Wow! This is pretty cool -- in 10-15 years, we could probably have this going for real!" -- the CTO's response was to chuckle and say that he hoped it would be much sooner than that. The company ran out of money some years later. Now, in 2024, I look around, I see what Waymo is up to, and I look at the strife that Cruise has had, and the (lack) of progress in the past five years, various other companies dropping out of the running, even the long-haul trucking almost winding down.. it's almost like we're at a stand-still. Clearly more driving practice isn't helping these systems get better.
AI inference boxes will not help these systems improve - it's hard to limit output, especially on unlimited input. It needs to be rules-based: actual, physical rules, given object detection and classification (the AI part), and knowledge of where it is in the world. Then, _rules_ (not AI) will be able to put the car in the _correct place_. However - you have to consider every situation in advance. That's not so bad, as there are rules to the road, and "Vehicle should be X distance from others at all times" -- and exception handling, "Vehicle came suddenly from the side," leading to rules of how-to-correct. These are really pretty generic, otherwise no one would ever be able to drive without stopping and thinking. (Car comes at us from the side, "Omg get away!!" and move to our other side and make room, without hitting whatever might be on our other side.)
Paradigm change. Rules (like physics) development, instead of AI. Strong, intuitive, lack-of-mistakes classification of objects, direction of travel, and speed, and intuition toward where they will go. It's doable. It will require culture-shift. Not by 2030, though.
(Score: 4, Insightful) by Skwearl on Sunday September 29 2024, @04:55AM
A few years ago, I passed the million kilometer driven mark, my last accident was over 20 years ago. I drive too work, using a class 5 vehicle. I looked at all computer driven systems, and was not worried about being replaced or redundant. I know, from experience, with uncanny reliability at this point, that someone is going to interfere with my passage. 99% of the time, I don't even have to consciously think about it, my hands and feet take care of it. For pleasure, I like to take trips to places that few go to, drive on roads that have no cell service, that, if I make a mistake will be my last. I've played with chat gpt and its ilk, they do help with the mundane, the easy. Safely driving, through snow and ice, distracted children and soccer moms, is not an easy task. If it where, it would be done, but it is not.
(Score: 2, Funny) by Rosco P. Coltrane on Sunday September 29 2024, @08:02AM
Overweight is hardly surprising in North America.
(Score: 3, Insightful) by RedGreen on Sunday September 29 2024, @01:22PM (1 child)
As the old Chinese proverb goes may you live in interesting times. And the the times certainly are interesting for the parasite corporations that have shipped all the jobs to China to take advantage of the slave labor and lax environmental standards. They thought they were doing so well with all those extra profits while doing it, all along the Chinese were taking all their methods of doing things and putting them into to practice in their local companies. Now the chickens come home to roost when those local companies have come close to building a monopoly position in key industries and are dumping massive amounts of product on the world stage to undermine the western businesses. All subsidized by Government of China in their effort to destroy competition to their goods all over the world. And still the parasite corporations are flocking to give even more to the scummy bastards in China, they get everything they deserve. Sure a few are looking to move some production to the next shit hole country run by some authoritarian piece of garbage government who will give them the same or worse human and environmental rights conditions. Very few show signs of doing it in their home counties that made them the success they are/were before they started on this effort to destroy their home markets with these policies they had enacted by the slimy bastard bought and paid for politicians.
"I modded down, down, down, and the flames went higher." -- Sven Olsen
(Score: 2) by mcgrew on Tuesday October 01 2024, @04:51PM
That was an old Chinese CURSE, not a proverb!
In 1942, all of America and most of the world was antifa.
(Score: 4, Interesting) by YeaWhatevs on Sunday September 29 2024, @02:06PM (4 children)
Well, at least in Ford's case not like they did before 2019. For some reason the cars don't last as long anymore. Personally I like my vehicle to last betond the life of the loan before I need expensive repairs. Considered swotching to GM, but since I'm now in the market I see Nissan is more reliable, according to the ratings. Darn shame, I really do like Ford vehicles.
(Score: 3, Interesting) by fliptop on Monday September 30 2024, @08:30PM (2 children)
Nissan has been steadily going downhill ever since Renault bought them 20-some odd years ago. Their automatic transmissions are terrible. If you are considering a Nissan, go w/ a Frontier and make sure it has a regular (non-CVT) transmission. And pray your A/C doesn't shit the bed (another common problem w/ them). I see a lot of Nissan cars in the shop for suspension work before they're over 100k miles. I'm not sure how much you drive or how long you get a loan for but, IMHO, suspension parts should last longer than 100k unless you live on a really long, bumpy road or there's an unavoidable pothole every 5 feet on the roads in your area.
Currently, Ford has the most open recalls of any manufacturer. Their EcoBoost engines are junk. The ones I see at the shop are usually rusted in the rocker panels. Another common problem is the tie rod on the full-size pickups that connects to the drag link (on the right front there's 2 tie rods, the lower one is what I'm talking about) and if it's galled and seized in the sleeve it can be a bugger to remove. Avoid the Bronco, it's too new to determine if they'll last. They did have some engine problems [youtube.com] early on b/c the valves were not manufactured correctly (or something) but I think that's been solved (time will tell). Their cars, IMHO, are poorly built. Plastic stuff inside like window switches, door handles, etc. breaks easily.
GM is even worse. Most common issue I see is oil leaks, ignition problems and frame rust, but I've worked on a lot of them and suspension parts do not last. If you do decide to buy one, though, check the VIN tag inside the door jam and DO NOT BUY IT if it was hecho en Mexico. The QC down there is horrible. They also suffer from the same plastic-breakage problems as Ford.
You're right, vehicles aren't made to last anymore. It's probably a combination of planned obsolescence and cutting corners to save a buck. My daily driver is a 2005 Pontiac Vibe (Toyota Matrix AWD drive train w/ Pontiac styling) w/ 190k miles. It's underpowered w/ a 1.8 L engine but it gets about 30 mpg and the only work I've done on it are regular maintenance (brakes, oil, etc.) , rust repair and exhaust. It's still rocking original suspension and steering parts (although the strut mounts are starting to bang around a little bit). Both my work trucks are over 50 years old. There's no way I'll buy anything newer than late 90's-early 00's. There's just too much delicate electronic BS in the newer vehicles.
Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.
(Score: 3, Interesting) by fliptop on Monday September 30 2024, @08:39PM (1 child)
I should have mentioned, the vehicles I recommend are, in this order, Toyota, Honda, Mazda and Subaru. You'll easily get 200k w/ regular maintenance out of the first two and 150k from the others. Supposedly Subaru has fixed the blown head gasket problem they had w/ early models. Supposedly. I recommend getting rid of a Subaru before it hits 150k miles, just in case.
Go naturally aspirated and avoid turbo if possible. Also try to get a manual transmission (very difficult to do these days). Thinking of a hybrid? I don't have enough experience w/ them to make a recommendation but I do know they're expensive to replace batteries in.
If you want something other than those 4, lease it. That way you can give it back when it gets near 100k miles.
Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.
(Score: 2) by mcgrew on Tuesday October 01 2024, @05:01PM
I don't have enough experience w/ them to make a recommendation but I do know they're expensive to replace batteries in.
That's an awful huge BUT. "I'm completely ignorant about them BUT I have well formed opinions based on my ignorance...
The hybrid's battery will likely outlast its transmission (if it has one, my buddy's hybrid doesn't).
In 1942, all of America and most of the world was antifa.
(Score: 2) by mcgrew on Tuesday October 01 2024, @04:56PM
For some reason the cars don't last as long anymore.
You kids, sheesh! Back when I was young the floorboards would rust out and every fluid in it would leak in less than five years. I just put a ten year old Subaru on a credit card, it's almost like a new car.
Your problem is you buy Fords. I bought a '69 Mustang in 1972 and spent more time under the hood than behind the wheel.
As you might guess, it was not only my first Ford, it was my last. Fastest car I ever owned but a piece of junk.
In 1942, all of America and most of the world was antifa.