Auto & Transport Roundup: Market Talk

Dow Jones
Aug 05

The latest Market Talks covering the Auto and Transport sector. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

1216 GMT - Tesla's latest pay package for CEO Elon Musk will keep him in the role at least until 2030 and removes an overhang on the stock, Wedbush analysts say in a research note. Tesla's board approved a stock award for Musk that it tentatively valued at $23.7 billion, the latest effort to compensate him after earlier pay packages were struck down by a Delaware judge. "While the groundwork is now in place for the next few years, it will be critical for the Tesla board of directors to get this long-term compensation strategy in place prior to the company's November 6th shareholder meeting which would address the elephant in the room and remove a significant overhang on the stock," say the analysts. Tesla is up 2% premarket. (denny.jacob@wsj.com; @pennedbyden)

0749 GMT - Hyundai Motor is set to take a softer-than-expected 2H hit from President Trump's tariffs after a South Korea-U.S. trade deal that lowered the levy on South Korean vehicles to 15% from the previously imposed 25%, DAOL Investment & Securities analyst J.W. Yoo writes in a note. Yoo raises his operating-profit estimates for the South Korean automaker by 8% to 3.4 trillion won for 3Q and 10% to 3.6 trillion won for 4Q to reflect lower tariff costs under the new deal. In 2026, Hyundai is expected to shoulder an additional 2.3 trillion won in tariff costs under the agreement, he adds. (kwanwoo.jun@wsj.com)

0700 GMT - IAG wrapped up the earnings season for European airlines with a 17% beat in earnings before interest and taxes, the biggest of the lot, Bernstein's Alex Irving and Antoine Madre say. This makes it Europe's other investable carrier, besides Ryanair, the analysts write in a note. The group, which operates British Airways, Iberia, and Aer Lingus, among others, earns its cost of capital through the cycle, returns cash to shareholders, and is best-placed for lasting structural trends of aircraft and slot constraint, they say. With BA's transformation in progress, combined with fleet renewal and its dominance at Heathrow, the stage is set for margin progression. "A common view among investors is that Europe has one investable, quality, airline: Ryanair. It in fact has two," the analysts say. (anthony.orunagoriainoff@dowjones.com)

0645 GMT - Thai Airways is likely emerging better and stronger, Maybank Securities (Thailand)'s Boonyakorn Amornsank says in a research report. Post-rehabilitation, the airline has fewer, more efficient aircraft and engines, a sharper focus on profitable routes, and its staff count reduced by 50%, the analyst notes. The airline plans to capitalize on its strategic location and national flag carrier status and grow its fleet by 50% over next five years to tap Asia's travel boom. This should generate stronger passenger yields and higher load factors than regional peers, particularly on European and Japan routes. The brokerage reinitiates coverage of the stock with a buy rating and a target price of THB10.00. Shares are 186% higher at THB9.50 after trading resumed earlier Monday. (ronnie.harui@wsj.com)

0526 GMT - Maruti Suzuki seems hopeful for better performance in the coming quarters, BNP Paribas Securities India's Kumar Rakesh says in a research report as the brokerage maintains the stock's outperform rating. Management hopes the Indian automaker will outperform domestic industry volume growth by 1%-2%, aided by two new sport-utility-vehicle model launches during FY 2026, the analyst notes. The brokerage sees improved volume growth for the automaker in 2H FY 2026 and its model launches as key stock catalysts ahead. However, the brokerage trims the stock's target price to INR15,790.00 from INR15,970.00 based on its assumption for the company's gradual margin recovery in the coming quarters. Shares are 0.4% lower at INR12,247.05. (ronnie.harui@wsj.com)

0514 GMT - Maruti Suzuki India's margins could remain under pressure, Nomura analysts say in a note. Expenses related to its new plant weighed on the automobile manufacturer's margins in 1Q and could continue to do so. Advertising and promotion costs could also affect margins. The analysts lower their FY 2026 Ebitda margin forecast to 11.2% while expecting 11.6% and 12% in FY 2027 and FY 2028, respectively. Meanwhile, tough market conditions are likely to affect domestic volumes, but new launches should sustain Maruti Suzuki's strong export outlook, they add. Nomura raises its target price to INR13,113 from INR12,886 while reiterating a neutral rating. Shares slip 0.2% to INR12,270. (megan.cheah@wsj.com)

0450 GMT - China's overall electric-vehicle market remains weak as customers await new model launches and policy updates from the government and automakers, Nomura analysts write in a note. Chinese automakers' July EV data was soft due to seasonal factors and the government's recent campaign against "toxic" price competition, they say. Most Chinese EV makers have faced muted orders and deliveries over the past four to five weeks, they add. Nomura notes that the campaign hasn't addressed the auto sector's fundamental problem of oversupply. Despite efforts to rein in price wars in China's auto market, competition will likely further intensify in the foreseeable future, the analysts say. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

0444 GMT - BYD is likely to deliver between 5.0 million and 5.2 million units this year, missing its target of 5.5 million units, say Nomura analysts in a note. With the Chinese government now discouraging car companies from undertaking price-cuts to push up sales, it may take time for BYD to execute new strategies and policies to drive deliveries, they add. The company may release new models or upgrade existing ones, which could provide some bottom-up opportunities for BYD, Nomura adds.(jiahui.huang@wsj.com; @ivy_jiahuihuang)

0226 GMT - HD Hyundai Mipo is poised to play a pivotal role in its parent shipbuilding conglomerate's global expansion, Daiwa Capital analysts Mike Oh and Daeho Son write in a note. The South Korean shipbuilder can leverage its expertise in making mid-sized commercial vessels--the segment now in rising U.S. demand--and also its know-how in operating shipyards overseas, notably in Vietnam, they say. Revenue contributions from high-margin orders in 2024 are likely to accelerate until next year, they say. HD Hyundai Mipo's 2024 orders are projected to account for 40% of revenue in 2025 and 60% of revenue in 2026, they add. (kwanwoo.jun@wsj.com)

(END) Dow Jones Newswires

August 04, 2025 12:20 ET (16:20 GMT)

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