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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: 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.