Shifting Gears: Auto Sector’s 2026 Roadmap

Know More. Risk Better. Podcast | Season 10, Episode 4

In this episode of the Know More. Risk Better. podcast, host Winnie Cisar, Global Head of Strategy at CreditSights, speaks with Todd Duvick, Head of Autos, and Jim Williamson, Senior Autos Analyst covering Europe, about the global automotive sector outlook for 2026. They explore vehicle sales forecasts, with both US and Europe expecting flat to slightly higher volumes around 16 million units, constrained by affordability despite lower interest rates and new tax deductions. The conversation examines the deregulation wave, including Europe’s pullback from the 2035 EV-only deadline to a 90% emissions reduction target and the US removal of consumer EV tax credits, saving GM $750 million annually. They analyze Chinese competition dynamics, with BYD’s potential US manufacturing and government interventions to stabilize pricing. The discussion covers margin trajectories, with single-digit operating margins becoming the new normal, offset by declining capex as the investment super cycle ends. They also address credit rating outlooks, highlighting Ford’s fallen angel risk, Honda’s margin challenges, and Renault as a rising star candidate. The episode concludes with investment recommendations: VW senior bonds for Europe and Ford for tactical opportunities. Listen now for expert insights on automotive credit positioning.

Speakers:

Winnie Cisar, Global Head of Strategy, CreditSights:
Winnie leads strategy coverage across credit markets, specializing in high yield, investment grade, leveraged finance, and new issue forecasting with a focus on technical and fundamental market drivers.

Todd Duvick, CFA, Head of Autos, CreditSights:
Todd leads research coverage across US autos and industrials sectors with over 20 years of banking experience and recognition on the Institutional Investor All-America Fixed Income Research team.

Jim Williamson, Senior Analyst, Autos, CreditSights:
Jim covers European autos and industrials sectors, focusing on OEMs and suppliers across both investment grade and high yield markets since joining CreditSights in 2019.

Timestamps:

00:00 – Introduction
01:27 – 2026 Car of Year
03:38 – Light Vehicle Sales Forecast
14:06 – Deregulation and EV Profitability
23:38 – Tariffs and Chinese Competition
39:18 – Credit Ratings Outlook
46:53 – Top Picks and Recommendations
49:12 – Conclusion & Key Takeaways