First Trust NASDAQ Global Auto Index Fund
Sizing up the competition: Is Tesla’s product unique?
Tesla is significant in terms of technology and finance, with its $26 billion market capitalization. Let’s take a look at Tesla’s competition.
How Auto Production in Mexico Is Trending amid Trade Fears
Mexico’s auto production rose 3.2% to 278.2 thousand vehicles in April 2017 as compared to April 2016 but decreased as compared to March 2017.
Why geography matters so much in the automotive industry
The U.S. market is dominated by truck sales, with trucks outselling cars at 51% of market share versus cars accounting for 49% of the market.
Can Malaysia’s Improved Retail Sales Support Economic Growth in 2017?
Retail sales in Malaysia rose 13.9% YoY (year-over-year) in June 2017, compared with its 13.6% gain in May 2017.
Must-know opportunities and risks for the automobile industry
Global automobile manufacturers each have their form of globalizing their manufacturing, prompted by changes in the market. For GM and TM, the benefits of these programs will be delayed.
ETFs Rise Due to Tesla Stock’s Santa Claus Rally
Tesla (TSLA) stock continues to rally. The stock has risen 77% sequentially and 28% year-to-date. The stock might rally to new highs in 2020.
Must-know: Top auto industry ETFs for investors
The First Trust NASDAQ Global Auto ETF (CARZ) is the most traded auto-focused ETF. The three-year return for the ETF is 48.32%. YTD, CARZ provided a return of 2.23%.
Recommendation: Break down automobile sales by geography
The strongest growth remains in Asia Pacific, North America, and Latin America. These are the areas where Ford (F), General Motors (GM), Volkwagen AG (VOW), and Toyota (TM) are investing.
Should Investors Buy Ford Stock Right Now?
Ford Motor (F) is one of the few US publicly traded auto stocks with attractive returns this year. With a 17% year-to-date gain, the stock has outperformed most of its peers.
Ford Enhances Shareholders’ Wealth with Dividend Payout
Continuing with the strategy of enhancing shareholders’ wealth, Ford Motor Company (NYSE:F) declared a dividend for the first quarter of 2020.
Ford Boosts Investment in Autonomous, Electric Vehicles
Ford is planning to invest over $1.45 billion in its two North American facilities in Michigan, with a focus on autonomous, electric, and big vehicles.
Why durable goods trends affect key wholesale trade releases
The Monthly Wholesale Trade Survey gives you nationwide estimates of monthly sales, end-of-month inventories, and inventories-to-sales ratios by businesses for wholesale firms.
What makes the auto industry highly concentrated?
The automobile industry is one of the most highly concentrated industries in the world. The market continues to be dominated by a few major companies.
Ford, Daimler, and BMW employ high financial leverage
Ford (F) uses a high amount of financial leverage. Its debt-to-capital ratio is 81.1%. This is significantly above the industry average of 53.1%.
Intense competition leads to low profit margins for automakers
The auto industry has lower margins primarily because of intense competition. It makes it difficult for companies to pass on increases in raw material prices to the customer.
A must-know investor’s guide to General Motors Company (GM)
General Motors Company (GM) designs, builds, and sells automobiles worldwide. It’s the largest U.S.-based automobile manufacturer and the second largest automobile manufacturer globally.
An incredible stock: What’s the big deal with Tesla?
Tesla, to most readers, is a beautiful, fast car. To most investors, it’s been an incredible stock. Let’s take a deeper look at this company that’s gained so much attention.
Why should investors pay attention to Honda’s market share?
Honda is global, with relative over-reliance on Japan and North America while being under-represented in the slow-growth market of Europe and higher-growth Asia.
The only luxury battery vehicle: How large is Tesla’s market?
Tesla is selling luxury and battery power. Logically, as Tesla’s market share increases, it’ll take share out of the luxury automobile market.
A must-know investor’s guide to Honda Motor Company
In this series, first, we’ll look at Honda’s strategy. Then, we’ll dig into the company’s revenue and earnings to see how Honda compares to other industry players.
A must-know investor’s guide to Toyota Motor Corporation
Toyota Motor Corporation (TM) designs, builds, and sells automobiles worldwide. It’s the largest automobile manufacturer in the world based on units sold in 2013.
Why Tesla’s distribution model differs from competitors
Tesla states in the annual filing that it wants to maintain ownership of distributions and repairs to differentiate itself from the market, keeping greater control over local sales and services.
Tesla’s financial statements show the company’s rapid growth
The bottom line on the income statement is that Tesla remains a start-up or newer business that’s not generating earnings from its sales.
Why the global automobile industry matters for investors
The global automobile industry is small relative to GDP, estimated to be in the mid-to-low single digits. It represents 3.5% of GDP, according to the Center for Automotive Research.
Will China’s Latest Attempt at Propping Up Its Economy Work?
China’s central bank, the People’s Bank of China (or PBoC), announced on January 4, 2019, that it will cut the reserve requirement ratio (or RRR) of Chinese (FXI) banks.
The Drawn Out US-China Trade War’s Impact on Businesses
One often-cited reason for the current market volatility and the reason for expected pressure on companies’ earnings is trade uncertainty, especially between the United States (SPY) and China (FXI).
What Investors Should Know as Trade War Muddies Economic Outlook
Trade wars muddying US economic outlook Another factor impacting the US (SPY) growth outlook is the unfolding of the trade war between the US (SPY) (DIA) and China (FXI). The US has already imposed three rounds of tariffs on Chinese imports covering a total of $250 billion worth of imports, which have been met with […]
US Jobs Growth Miss Was a Respite for Gold—How’s the Outlook?
The US job additions in July reached only 157,000, lower than the expectations of 190,000 job additions.
Why May Consumer Confidence Signals a Strong Second Quarter
The consumer confidence index has increased to 128.0 in May as compared to a downward revised April reading of 125.6.
These Sectors Drove Industrial Production Higher in March
Industrial production continued to rise in March after strong growth in February.
What Drove Consumer Sentiment Index to 14-Year High?
The University of Michigan final consumer sentiment for March was reported at 101.7, up by 1.7 as compared to the final February reading of 99.7.
Which Countries and Industries Could Be Affected by the Tariffs?
Canada, the European Union, South Korea, Mexico, and Brazil are the largest exporters of steel and aluminum to the United States.
Why Economist Argue That Tariffs Are Bad for the Economy
The recently proposed import tariffs on steel and aluminum imports by US President Donald Trump are an effort to protect the interests of US manufacturers.
Could the Lower 4Q17 GDP Estimate be Reason to Worry?
The US Bureau of Economic Analysis (or BEA) has released its second 4Q17 GDP estimate, projecting that the US economy increased at an annual rate of 2.5%.
Analyzing the Retail Sales Drop in January
The advance estimates for US retail (XRT) and food services in January 2018 were $492 billion—a decrease of 0.3% from December.
What Drove Industrial Production Higher in December 2017
The Fed’s December industrial production report was released on January 17. The report indicated that industrial production continued to improve throughout 2017.
Retail Sales Had the Best Year since 2012
Retail sales (RTH) have posted impressive growth in 2017. However, the growth is still below the long-term average.
A Look at GM’s Stock Performance
In this part of our focus on the top 18 cheap S&P 500 stocks, we’ll discuss another six stocks: General Motors (GM), Ford Motor (F), Owens-Illinois (OI), The Goodyear Tire & Rubber Company (GT), Navient (NAVI), and Brighthouse Financial (BHF).
What a Rise in Retail Sales Means for the Sector
The United States Census Bureau’s latest retail (XRT) sales report was released on December 14, 2017. It reported that retail sales for November have risen 0.8%.
The Economic Indicators Covered by the Fed’s Beige Book
Comparing the economic performance with economic expectations and the previous cycles gives investors an idea of whether the economy is expanding or contracting.
Conference Board Consumer Confidence Rose in November
The Conference Board Consumer Confidence Index for November came in at 129.5, up from 126.2 in October.
The FOMC’s View on the US Economy
At the November meeting, the FOMC staff review indicated that US labor market conditions continued to strengthen and that the US economy continued to expand at a solid pace.
Which Industry Helped Retail Sales Grow in October?
Core sales—excluding energy (XLE), building materials, and auto sales—also rose 0.4% in October, which is a positive sign for the economy.
Here’s What Drove Consumer Expectations Lower in November
The University of Michigan Preliminary Consumer Sentiment for November was reported at 97.8, which was 2.9 lower than the final October reading of 100.7.
What Led to the Rise in the US Trade Deficit in September?
The latest report was released on November 3 and indicated that the goods and services deficit was $43.5 billion in September, or $0.7 billion higher than in August.
How FOMC Members Assessed the US Economy in the July Meeting
FOMC members noted that labor market conditions have continued to strengthen since their last meeting in June.
South Korean Exports’ Impact on Manufacturing Activity
Manufacturing activity in July 2017 South Korean (EWY) manufacturing activity dropped in the July 2017, with a sharp reduction in output. The Nikkei South Korea (EEM) manufacturing PMI decreased to 49.1 from 50.1 in June, according to an IHS Markit report. Manufacturing activity in South Korea returned to contraction, with reduced orders for its key export markets, […]
Mexico’s Auto Production Set a Record in June—Will It Continue?
The auto industry in Mexico depends on NAFTA, as major auto manufacturers in the United States have made Mexico their manufacturing and export hub.
Why the Fed Isn’t Satisfied with Labor Market Conditions
Despite the strong growth in employment numbers, the Fed’s latest monetary policy report had some comments about slow wage growth.
How Will Falling Gas Prices Impact Gas Station Sales?
In any economy, the cost of fuel plays an important part in retail sales (XRT) and inflation (TIP).
Why Retail Sales Are an Important Indicator of Economic Growth
In this series, we’ll explore the trends in consumer spending in recent months and try to shed some light on the retail sales data that will be released on July 14.
How Will S&P 500 React to Another Rate Hike This Year?
The Fed’s decision had a limited impact on the S&P 500 (SPY), which closed last week at 2,433.2, a gain of 0.06% for the week.
Inside Mexico’s Rising Trade Deficit in March 2017
Mexico recorded a modest trade deficit in March 2017, as compared to its trade surplus in the previous month.
Why growth shifted in the global automotive industry
The automotive industry is geographically concentrated. The top 15 countries produce 88% of the world’s vehicles. Almost all of the G20 nations have a manufacturing unit.
Why GDP and automotive industry growth are related
There’s a direct correlation between the size of a country’s GDP and its automotive industry. The auto industry has been expanding at a fast pace over the past several years.
Vehicle leasing is driven by life cycles and innovation
There are higher maintenance and repair costs as a car gets older. This supports the option of leasing a vehicle.
Automakers use incentives to entice customers
Typically, automakers provide incentives in a slow market. They offer incentives for low-selling models. The total number of vehicles sold in the US in 2014 was 16.5 million.
High operating leverage impacts the auto industry
The auto industry has high operating leverage. Operating leverage represents fixed costs as a percentage of total costs. High operating leverage magnifies gains and losses.
Advertising is key for automotive companies
The automotive industry is one of the biggest spenders when it comes to advertising. General Motors (GM) paid out $928 million during the first half of 2014.
Why the automotive industry generates employment
The automotive sector plays a crucial role in job creation. Car manufacturing activity has an employment multiplier value of five.
Daimler and BMW dominate the luxury car segment
German automakers lead the luxury space in the US. Daimler AG had an 18.4% share. It was followed by BMW. It had a 16.8% share.
Certain automakers dominate the different car segments
The domestic giants have a significant US presence in trucks. These automakers show their muscle in the midsize SUV segment.
The US automotive industry’s big guns are declining
The competition between light trucks and cars characterizes the US automotive market. Over the past four years, consumers steadily moved towards SUVs and pickups.
Does monetary policy impact stocks?
Although monetary policy mainly impacts government bonds, equity investments are also impacted. It’s important to understand why and when equities react to policy announcements.
The must-know risks and opportunities for Honda’s stock
Over this series, we’ve seen that Honda’s heritage is rooted in innovative engineering and customer satisfaction. It has been a daring company in the past.
Must-know: Why Honda is unusual among major auto makers
Amazingly, the millions of engines Honda produces each year only account for 3% of the company’s revenue. Let’s look at Honda’s operating income to find out why.
An investor’s guide to Honda Motor Company: Revenue and drivers
We’ll take a brief look at industry sales to assess Honda Motor Company’s (HMC) position in the global industry. First, we’ll look at industry sales, and second, we’ll assess Honda’s ability to capture its share of the market.
Investor must-know: Toyota’s important risks and opportunities
Toyota’s history is one of growth. Over the past 30 years, Toyota (TM) successfully entered a new market segment and took market share in the U.S., the largest market in the world.
Recommendation: Read the equity market’s view of Toyota
Toyota is investing in R&D (research and development) for new products, has free cash flow to internationalize its manufacturing footprint, and has significant market share in leading economies.
An investor’s guide to Toyota: Revenue and key drivers
We’ll take a brief look at industry sales to assess Toyota Motor Company’s (TM) position in the global industry. First, we’ll look at industry sales, and second, we’ll assess Toyota’s ability to capture its share of the market.
Becoming a competitive auto company: General Motors’ strategy
General Motor’s (GM) stated vision is to design, build, and sell the world’s best vehicles. In reality, it’s seeking to sell the most cars and gain economies of scale across its global footprint.
Do GM’s latest earnings reflect its vast global market share?
GM’s revenues are driven by light trucks in the U.S. and cars in China. Earnings are pulled down by inefficient operations. Let’s see how they compare to the industry.
Competitive advantage and earnings are key to the auto industry
Relative measures become significant when you look at the dollar amount differences between Toyota and GM in terms of the scale of the two businesses.
Why companies like Toyota lead in global automobile market share
Global market share is dominated by the top ten original equipment manufacturers (or OEM), which account for 81% of the global automotive industry’s annual sales.
Must-know growth drivers for the global automobile industry
The global automobile market is impacted by global GDP, consumer confidence, employment, the availability of credit, the price of fuel, and consumer confidence.
Auto sales: Can record incentives revive auto industry fortunes?
Light vehicle auto sales for March will be released on Tuesday, April 1. The light vehicle annualized selling pace came in at 15.3 million in February.