Stocks of European automakers are being battered after several high-profile names lowered their forward guidance and issued profit warnings as global demand weakens.
As a group, European-based automakers saw their stocks decline sharply, led by a 12% plunge in the share price of Stellantis (STLA) after that company lowered its 2024 annual guidance.
Management at Stellantis said the lowered guidance was due to deteriorating “global industry dynamics” and increasing domestic competition in China, the world’s largest car market.
At the same time, France’s Renault (RNO) saw its stock decline 6% lower after it issued a profit warning for the current third quarter amid what it called weak global demand for vehicles.
Germany’s Volkswagen (VOW3) stock was trading down 3% after the biggest automaker in Europe lowered its forward guidance.
The car manufacturer said that it now expects to deliver nine million vehicles worldwide this year. That’s about 3% less than the 9.24 million vehicles the company delivered in 2023.
Volkswagen also said that it expects the value of its vehicle sales this year to decline by 0.7% to $356.7 billion U.S. Earlier this year, the company forecast that its sales would rise 5% in 2024.
The lowered guidance from Volkswagen also comes as the company enters contract negotiations with its largest union.
Earlier in September, management at Volkswagen said they are considering closing some manufacturing facilities in Germany for the first time in the company’s history as they try to achieve $11 billion U.S. in cost savings.
Automakers worldwide are struggling with waning consumer demand and a pivot away from electric vehicles and towards gas-electric hybrid brands.
