JPMorgan issues upbeat outlook for European automakers

Yahoo Finance's Pras Subramanian breaks down JPMorgan's call on European automakers for 2023 as the bank expect supply chain snags to ease and luxury car makers like Stellantis and Porsche to perform.

Video Transcript

- And let's broaden out for a minute here, Pras, because we've got some notes that are starting to come in about the outlook for the automotive industry for next year. What are we hearing?

PRAS SUBRAMANIAN: So today, JPMorgan came out with their European Auto's Outlook for 2023. This is for the European automakers only. They see a better year ahead for next year. They see that the production, sort of the supply chain snarls will ease, as well as cheaper materials costs for batteries and things like that.

The really high conviction stocks are Renault, Mercedes, and Stellantis. And Porsche is their top luxury pick for the automaker for the sector following its IPO in the Fall. On the supplier front, they like companies, like the Tesco, tire maker Pirelli, and also, parts maker Valeo, which makes OEM parts for BMW, among others.

- Pras, if I ever need a book, I'm coming to your place.

[LAUGHING]

PRAS SUBRAMANIAN: Anytime, [? Sad, ?] anytime.