We wanted to flag a few highlights in today's (07/01/19) Wolfe Research Auto Daily....
2Q Supplier Preview
Expectations for light vehicle production, both for Q2 and the full year, have deteriorated further over the past few weeks. We expect most suppliers (ALV, DLPH, LEA, MGA, TEN, AXL) to all come in below consensus for Q2.
Gas Pressure: Why a soft Q2 for U.S. Suppliers looks like a prelude to something worse.
In a report published today we discuss why we’re becoming more cautious about the outlook for 2020, and lowering estimates.
China: We are seeing signs of stress amongst local OEMs and Suppliers in China, with potentially adverse near- to intermediate-term implications.
Europe: Even more concerning for U.S. Suppliers, CO2 regulations in Europe will likely have negative implications for customer margins, pricing and terms, and ultimately demand. In today’s report we summarize high level views on European CO2 Regs that we’ve gathered from OEMs, Suppliers, and Consulting Firms. Our conclusion: Even without an economic downturn, the implications for suppliers are likely larger than expected.