• Goldman Sachs lowers its global auto production forecast to reflect the tight supply and demand environment that is anticipated to last several more quarters as the global chip shortage and other supply chain issues impact production. The firm now sees 75M autos produced in 2021 vs. 83M prior forecast and 85M in 2022 vs. 90M prior forecast.t
• The unexpected backdrop sets up some automakers to outperform, per Goldman. "Several of our Buy rated stocks strike a good balance in our opinion of having strong financial models (e.g., attractive margins and/or [free cash flow]) that we think can provide resiliency in a difficult supply chain environment," notes analyst Mark Delaney. In particular, Tesla is called an industry leader that is well positioned for growth and General Motors is seen as an attractive stock that captures the benefit from an industry recovery in production as well as opportunities to benefit from EVs and advanced driver-assistance systems. Both stocks have a Buy rating at Goldman and price targets that imply double-digit upside. The setup is seen being not nearly as favorable for Lordstown Motors, which was cut to a Sell rating.