{"id":7828,"date":"2026-10-09T09:54:16","date_gmt":"2026-10-09T07:54:16","guid":{"rendered":"https:\/\/ha-gim.com\/automotive-sector-the-clock-is-ticking\/"},"modified":"2026-10-09T10:57:03","modified_gmt":"2026-10-09T08:57:03","slug":"automotive-sector-the-clock-is-ticking","status":"publish","type":"post","link":"https:\/\/ha-gim.com\/en\/automotive-sector-the-clock-is-ticking\/","title":{"rendered":"Automotive Sector: The Clock Is Ticking"},"content":{"rendered":"

[et_pb_section fb_built=”1″ _builder_version=”4.27.9″ _module_preset=”default” vertical_offset=”-75px” vertical_offset_tablet=”-90px” vertical_offset_phone=”-90px” vertical_offset_last_edited=”on|desktop” custom_margin=”100px||35px||false|false” custom_margin_tablet=”100px||35px||false|false” custom_margin_phone=”130px||0px||false|false” custom_margin_last_edited=”on|phone” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_row _builder_version=”4.27.9″ _module_preset=”default” positioning=”absolute” position_origin_a=”bottom_center” vertical_offset=”-45px” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_column type=”4_4″ _builder_version=”4.27.4″ _module_preset=”default” z_index=”3″ global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_image src=”https:\/\/ha-gim.com\/wp-content\/uploads\/2025\/02\/Adobe-Express-file-1.jpg” title_text=”Adobe Express – file (1)” align=”center” _builder_version=”4.27.4″ _module_preset=”default” z_index=”1″ width_tablet=”25%” width_phone=”45%” width_last_edited=”on|desktop” border_radii=”on|360px|360px|360px|360px” global_colors_info=”{}” theme_builder_area=”post_content”][\/et_pb_image][et_pb_text _builder_version=”4.27.9″ _module_preset=”default” header_5_font_size=”20px” text_orientation=”center” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Steffen Briel<\/h5>\n

Senior Portfolio Manager Multi Asset Credit; Investment Grade<\/p>\n

Portfolio Management Credit<\/p>\n

<\/span><\/p>\n

[\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section][et_pb_section fb_built=”1″ _builder_version=”4.27.9″ custom_padding=”0px||||false|false” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_row _builder_version=”4.27.9″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” custom_padding=”0px||||false|false” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_column type=”4_4″ _builder_version=”4.16″ custom_padding=”|||” global_colors_info=”{}” custom_padding__hover=”|||” theme_builder_area=”post_content”][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ text_font_size=”20px” header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

German automakers have not yet been able to stabilize their profitability. For now, most are offsetting rising business risks with robust balance sheets\u2014but they must use this time to make structural adjustments. The automotive sector is thus increasingly becoming a credit story: cash flow, balance sheet quality, and market access are coming to the fore. In our view, the risk premiums are attractive only at first glance. We therefore remain underweight and selective. <\/p>\n

[\/et_pb_text][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ text_font=”Celias – medium||||||||” text_font_size=”21px” header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Same Problems\u2014Same Causes<\/p>\n

[\/et_pb_text][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

\u201cThe latest news from the automotive industry is alarming.\u201d<\/em> That was the message in our Credit Pulse report, \u201cAutomotive Sector: Challenging Times, \u201d<\/a> published in October 2024. At that time, leading OEMs\u2014particularly those based in Germany\u2014had been forced to revise their forecasts for the fiscal year downward. <\/p>\n

Two years later, a sense of d\u00e9j\u00e0 vu sets in, because the causes are the same: a weak Chinese economy, excessive costs, and new competition. On top of that, U.S. tariffs have been in place since 2025. <\/p>\n

Unlike in 2024, when there was still talk of a return to normalcy following the record profits of the post-pandemic years, German OEMs have so far failed to stabilize their profitability. From a lender\u2019s perspective, however, focusing solely on profitability is not enough: In some cases, profitability is weighed down by non-cash impairments\u2014a consequence of the restructuring programs that have been implemented and announced. Furthermore, thanks to their robust financial services divisions, most manufacturers continue to have positive net liquidity and maintain consistently high liquidity reserves. <\/p>\n

[\/et_pb_text][et_pb_text _builder_version=”4.27.9″ _module_preset=”default” text_font=”Celias – medium||||||||” text_font_size=”21px” custom_margin=”||10px||false|false” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

OEM Profitability<\/p>\n

[\/et_pb_text][et_pb_image src=”https:\/\/ha-gim.com\/wp-content\/uploads\/2026\/10\/Chart-1-Automotive-1.png” alt=”Interest rate differential between US and German government bonds ” title_text=”Chart 1: Automotive” align=”center” _builder_version=”4.27.9″ _module_preset=”default” width=”80%” max_width=”100%” module_alignment=”center” custom_margin=”||60px||false|false” custom_padding=”|0px||||” hover_enabled=”0″ global_colors_info=”{}” theme_builder_area=”post_content” sticky_enabled=”0″][\/et_pb_image][et_pb_text _builder_version=”4.27.9″ _module_preset=”default” text_font_size=”12px” text_line_height=”1.4em” custom_margin=”-10px||29px|||” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Source: Bloomberg, trailing 12-month EBIT margin, company data, own presentation, period: 2009 through June 30, 2026.<\/em><\/p>\n

[\/et_pb_text][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ text_font=”Celias – medium||||||||” text_font_size=”21px” header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

From Earnings Growth to a Credit Story<\/p>\n

[\/et_pb_text][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

However, balance sheets\u2014which remain solid in most cases\u2014are coming under pressure due to persistently weak operating performance and the industry\u2019s long-term structural challenges. In our view, regulation, competition, and technological change are significantly increasing business risk in the automotive sector. For now, most manufacturers can still offset this risk with their strong balance sheets. However, OEMs should use the leeway this provides to make the necessary adjustments rather than resting on their laurels. Without structural improvements to their competitive position, operating performance will increasingly result in weaker balance sheets and, consequently, lower credit quality. <\/p>\n

As a result, the automotive sector is increasingly becoming a credit story: rather than earnings growth and opportunities, cash flow and balance sheet quality are taking center stage. Symbolically, Volkswagen was removed from the Euro Stoxx 50 on September 21, 2026. <\/p>\n

[\/et_pb_text][et_pb_text _builder_version=”4.27.9″ _module_preset=”default” text_font=”Celias – medium||||||||” text_font_size=”21px” custom_margin=”||10px||false|false” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Automotive Sector: Risk Premiums Are Attractive Only at First Glance<\/p>\n

[\/et_pb_text][et_pb_image src=”https:\/\/ha-gim.com\/wp-content\/uploads\/2026\/10\/Chart-2-Automotive.png” alt=”Interest rate differential between US and German government bonds ” title_text=”Chart 2: Automotive” align=”center” _builder_version=”4.27.9″ _module_preset=”default” width=”80%” max_width=”100%” module_alignment=”center” custom_margin=”||60px||false|false” custom_padding=”|0px||||” global_colors_info=”{}” theme_builder_area=”post_content”][\/et_pb_image][et_pb_text _builder_version=”4.27.9″ _module_preset=”default” text_font_size=”12px” text_line_height=”1.4em” custom_margin=”-10px||29px|||” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Source: Bloomberg, Automotive (Bloomberg Euro-Aggregate Automotive Index), Industrial BBB (Bloomberg Euro-Aggregate: Industrials Baa Index), own calculations; as of September 18, 2026.<\/em><\/p>\n

[\/et_pb_text][et_pb_text content_tablet=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which high single-digit returns can still be achieved on corporate bonds. <\/h2>\n

” content_phone=”<\/p>\n

The risk premiums on corporate bonds are low and the hoped-for interest rate cuts could fail to materialize!
\nThe question arises: where to put the money? We show you a niche segment in which returns in the high single-digit range can still be achieved with corporate bonds. <\/h2>\n

” content_last_edited=”off|desktop” _builder_version=”4.27.9″ header_2_font_size=”25px” background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Currently, the spread of the Automotive Index is about 15 basis points above that of the Corporate Non-Financials Index. In the current environment of historically tight spreads, this level appears attractive. A closer look, however, reveals that the risk premium relative to the overall market has hardly changed over the past two years; in absolute terms, it has settled at a higher level since 2024. Furthermore, this analysis overlooks the increasing deterioration in credit quality within the sector. Given the ongoing refinancing needs and the negative operating trend, we remain underweight in the sector and are selectively focusing on individual OEMs. <\/p>\n

 <\/p>\n

[\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section][et_pb_section fb_built=”1″ _builder_version=”4.25.2″ _module_preset=”default” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_row _builder_version=”4.25.2″ _module_preset=”default” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_column type=”4_4″ _builder_version=”4.25.2″ _module_preset=”default” global_colors_info=”{}” theme_builder_area=”post_content”][et_pb_toggle title=”Risks” open_toggle_background_color=”RGBA(255,255,255,0)” closed_toggle_background_color=”RGBA(255,255,255,0)” icon_color=”#000000″ open_icon_color=”#000000″ _builder_version=”4.27.4″ _module_preset=”default” border_width_all=”0px” border_width_bottom=”1px” border_color_bottom=”#93642e” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

Price losses due to increases in yields and\/or higher risk premiums are possible. A total loss cannot be ruled out either. <\/span><\/p>\n

Past performance is not an indication of future results, nor can future performance be guaranteed.<\/span> <\/p>\n

[\/et_pb_toggle][et_pb_toggle title=”Disclaimer” open_toggle_background_color=”RGBA(255,255,255,0)” closed_toggle_background_color=”RGBA(255,255,255,0)” icon_color=”#000000″ open_icon_color=”#000000″ _builder_version=”4.27.4″ _module_preset=”default” border_width_all=”0px” border_width_bottom=”1px” border_color_bottom=”#93642e” global_colors_info=”{}” theme_builder_area=”post_content”]<\/p>\n

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The information is based on our assessment of the current legal and tax situation. If tax or
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German automakers have not yet been able to stabilize their profitability. For now, most are offsetting the rising business risk with robust balance sheets\u2014but they must use this time to make structural adjustments. <\/p>\n","protected":false},"author":2,"featured_media":7614,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","_seopress_robots_follow":"","_seopress_robots_imageindex":"","_seopress_robots_snippet":"","_seopress_robots_primary_cat":"","_seopress_robots_breadcrumbs":"","_seopress_robots_freeze_modified_date":"","_seopress_robots_custom_modified_date":"","_seopress_robots_canonical":"","_seopress_social_fb_title":"","_seopress_social_fb_desc":"","_seopress_social_fb_img":"","_seopress_social_fb_img_attachment_id":0,"_seopress_social_fb_img_width":0,"_seopress_social_fb_img_height":0,"_seopress_social_twitter_title":"","_seopress_social_twitter_desc":"","_seopress_social_twitter_img":"","_seopress_social_twitter_img_attachment_id":0,"_seopress_social_twitter_img_width":0,"_seopress_social_twitter_img_height":0,"_seopress_redirections_value":"","_seopress_redirections_enabled":"","_seopress_redirections_enabled_regex":"","_seopress_redirections_logged_status":"","_seopress_redirections_param":"","_seopress_redirections_type":0,"_seopress_analysis_target_kw":"","_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[40,1,34],"tags":[],"class_list":["post-7828","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment-grade","category-nicht-kategorisiert","category-specialist-article"],"_links":{"self":[{"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/posts\/7828","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/comments?post=7828"}],"version-history":[{"count":8,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/posts\/7828\/revisions"}],"predecessor-version":[{"id":7839,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/posts\/7828\/revisions\/7839"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/media\/7614"}],"wp:attachment":[{"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/media?parent=7828"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/categories?post=7828"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ha-gim.com\/en\/wp-json\/wp\/v2\/tags?post=7828"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}