Auto stocks slide as earnings, macro and pricing concerns weigh heavily
shaunl

The automobile sector is reeling with recession worries, earnings jitters, and reverberations from Tesla's (NASDAQ:TSLA) price cuts denting investor sentiment on Thursday.
A gloomy update from S&P Global on the auto sector is also adding to the negative mix. The ratings agency thinks the end of cheap capital, worsening macroeconomic conditions, raw material uncertainties, and the ongoing war in Ukraine will combine to mark 2023 as the beginning of an era when demand-side considerations replace the current supply-side fixation. Of note, S&P Global Mobility analyst Brian Rhodes also reminded that the semiconductor shortage is not over. "The average chip content per car is increasing at an accelerated rate because of electrification. The capacity deficit will become visible again as soon as demand from other industries picks up, he warned.
The S&P takeaway is that the macro environment is not conducive to success for manufacturers and suppliers who do not have a good handle on costs or a degree of operational flexibility to manage the headwinds.
Decliners across the broad auto-related sector included Arrival (ARVL) -14.80%, Embark (EMBK) -13.00%, Arcimoto (FUV) -12.50%, Lightning eMotors (ZEV) -11.76%, Atlis Motor Vehicles (AMV) -11.75%, Cenntro Electric Group (CENN) -10.85%, Hyzon Motors (HYZN) -9.45%, Cazoo (CZOO) -8.95%, Allego N.V. (ALLG) -8.27%, Lucid Group (LCID) -8.29%, Aeva Technologies (AEVA) -7.99%, Hylion Holdings (HYLN) -7.41%, Faraday Future Intelligent (FFIE) -7.40%, Sono Group (SEV) -7.20%, Mullen Automotive (MULN) -6.90%, Fisker (FSR) -6.90%, Blue Bird Corporation (BLBD) -6.22%, GreenPower Motor (GP) -5.15%, and Goodyear Tire & Rubber (GT) -5.05%.
Detroit automakers Ford Motor (F) -2.78% and General Motors (GM) -2.65% are also lower, while Austin-based Tesla (TSLA) is off 2.55%.
The big swing lower for auto stocks comes just in front of the Tesla earnings report next week. Expectations on TSLA are being reeled in by analysts with some wildcards in the mix following the round of price cuts in China and the U.S.