1 Green Flag and 1 Red Flag for Automakers
No one said investing was easy. Stocks in the auto sector look a great value, and their prospects will surely improve over time. But the industry continues to be plagued by supply chain issues, component shortages, and the ongoing struggle to ramp up production. It's a classic case of near-term risk and long-term opportunity.
Here's why the auto sector faces red and green flags simultaneously and the best way to invest in it.
It's an incredibly frustrating time for the auto industry. It's no secret that traditional vehicle producers are under time pressure to maximize sales and profits from internal combustion engine (ICE) models while the transition to electric vehicles (EV) occurs. However, a series of external issues (semiconductor shortages, China lockdowns, component shortages due to the ongoing conflict in Ukraine, etc.) have caused downgrades to light vehicle production (LVP) estimates.
Source Fool.com
