Deutsche Bank: Global Auto, Mobility & Robotics Conference Takeaways — Preparing for Changing Dynamics
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Deutsche Bank's Global Auto, Mobility & Robotics Conference highlighted a complex industry backdrop: short-term volume resilience contrasting with escalating macroeconomic pressures. US and European automotive markets have shown surprising near-term strength, but inflationary impacts from Middle East conflicts—spanning raw materials, logistics, and energy—are emerging. IHS revised down 2026–2028 production estimates by roughly 2.5 million units combined, contrasting with broader OEM and supplier optimism.
Pricing remains challenging; US manufacturers struggle to offset tariffs fully via price increases, while Chinese pricing stabilizes. Non-automotive ventures, including humanoid robotics, data centers, and defense, represent promising growth avenues for suppliers, though material contributions remain two to five years away. Chinese OEMs are accelerating global exports, benefiting aligned suppliers but forcing traditional OEMs to localize.
Electrification expectations are moderating pragmatically, extending internal combustion engine lifecycles and prompting suppliers to cautiously manage EV investments while demanding cost-sharing from OEMs. Several companies are actively restructuring, utilizing automation to optimize capacity and improve margins.
Company-specific highlights include Aptiv (Buy), with roughly $3 billion in non-auto revenue, and Autoliv (Hold), projecting $90 million in second-half raw material cost increases. BorgWarner (Buy) targets $300 million in 2027 data center revenue. Dana (Buy) and Ford (Hold) were also covered. Overall, the sector faces a cautiously optimistic short-term outlook amid growing medium-term risks.