It has been a rough ride for auto industry investors in recent months: The global semiconductor chip shortage continues to constrain vehicle production and rising costs squeeze company margins, sending share prices in reverse.
Auto industry investors did have a good run coming out of the pandemic. For example, shares of car maker General Motors Co. and parts supplier Magna International Inc. were each trading above prepandemic levels by the end of 2020 – and both reached record highs in the spring of 2021, driven by increased demand.
“The short term is very uncertain for all of these companies,” he says, but he sees better days ahead for auto companies once production returns. He also points to dealership company AutoCanada, which sells new and used cars, as an alternative for investors in the sector.
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