Blog: 2004 will be another tough year - Goldman Sachs
Dave Leggett | 24 February 2004
I've just been sent a weekly circular from the Goldman Sachs European Autos Team in London. They're in bearish mood this week. Here's the covering note:
'Market unwilling to discount earnings revival in 2004.So far this year the autos sector has underperformed the market by 7% and full-year results thus far have given little to be cheerful about. Most companies see little prospect of materially higher earnings in the near term. We share the belief that 2004 is likely to be another tough year.'
Some other snippets make interesting reading. Keith Hayes on Volkswagen: 'In our view, the stock remains overvalued and the market appears reluctant to recognise the full extent of VW's problems.'
Gary Lapidus on US sales: 'Feb and YTD sales are below plan, despite rising incentives, leaving truck inventory bloated. But Detroit isn't likely to "throw in the towel," i.e., cut production, before May. Rather, look for incentives to "go nuclear" if sales don't pick up during March.'
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