Bernstein sees Stellantis well placed amid US EV market slowdown

On Friday, Bernstein analysts provided insights into the evolving electric vehicle (EV) industry, highlighting the divergent paths of China and Western markets. The U.S. EV market, in particular, is experiencing a slowdown, with EV sales now constituting 9.9% of new car sales, a marginal increase from the previous year’s 9.6%, and a notable deceleration from the 2.9 percentage point growth observed from 2023 to 2024. This market uncertainty is reflected in the automotive sector’s volatility, with InvestingPro data showing major players like Ford maintaining significant market presence with $182.87 billion in revenue despite challenging conditions. Despite this, Bernstein forecasts a continued growth in EV sales, projecting that by 2030, 25% of new car sales will be battery electric vehicles (BEVs) and 11% will be plug-in hybrid electric vehicles (PHEVs).

The analysts emphasized the need for original equipment manufacturers (OEMs) and investors to prioritize flexibility, as the initial phase of easy EV growth—characterized by policy support, premium pricing, and supply constraints—is coming to an end. The next phase is expected to be more capital-intensive and politically volatile, requiring OEMs to have flexible architectures, cost discipline, and regulatory agility to navigate the expanding mainstream market successfully.

Stellantis (NYSE:STLA) is identified by Bernstein as the best-positioned OEM in the face of the U.S. EV market’s slowdown, thanks to its new multi-technology platform and its exposure to the faster-growing European EV market. This strategic positioning is anticipated to help Stellantis maintain better returns on EV investments compared to its Detroit counterparts.

In contrast, Ford has taken cautious steps by delaying and canceling some of its EV projects while it develops a new EV platform expected to launch in 2027 or later. Bernstein notes that Ford’s transparent reporting structure reveals the company’s Model e EV business unit will continue to incur billions in losses, with significant volume growth needed to achieve profitability in the coming years. According to InvestingPro analysis, Ford currently trades at an attractive P/E ratio of 8.09 and offers a substantial 7.34% dividend yield, though its gross profit margins remain challenged at 8.07%. For deeper insights into Ford’s valuation and 12+ additional ProTips, including detailed financial health scores and Fair Value estimates, investors can access the comprehensive Pro Research Report available on InvestingPro.

General Motors (NYSE:GM), meanwhile, has reduced its planned investments in battery manufacturing, reflecting a more conservative approach. While this results in slower EV volume growth and delayed profitability, General Motors is perceived to be avoiding impulsive decisions and focusing on a long-term strategy with its Ultium platform. With Ford’s market capitalization currently at $40.64 billion and analysts forecasting a sales decline this year, the automotive industry’s transformation continues to present both challenges and opportunities for established manufacturers.

In other recent news, Ford Motor Company (NYSE:F) announced a recall of nearly 1.1 million vehicles in the United States due to a software issue affecting rearview cameras. This precautionary measure impacts various models from 2021 to 2024, including the Bronco and F-150, to mitigate potential accident risks. Meanwhile, Bernstein has increased its price target for Ford stock to $8.30, although it maintains an Underperform rating, citing potential market challenges later in 2025 despite a strong first half. In a leadership update, Ford appointed Kyle Crockett as the new Chief Accounting Officer, effective after the second quarter financial report, succeeding Mark Kosman. Crockett’s extensive experience is expected to enhance Ford’s financial operations. Additionally, Ford’s production facilities in Cologne, Germany, are facing potential disruptions due to a planned strike, with further details yet to be disclosed. In response to recent U.S. tariffs, Ford has raised prices on models produced in Mexico, including the Mustang Mach-E, Maverick, and Bronco Sport, with increases up to $2,000.

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