26 March 2026 Global Autos Global Autos: High oil prices reshape demand (over time) — Boost for Chinese EVs and Japanese hybrids, Headwinds for U.S. gas- guzzlers Masahiro Akita +81 3 6777 6998 masahiro.akita@bernsteinsg.com Venugopal Garre +65 6326 7643 venugopal.garre@bernsteinsg.com Stephen Reitman +44 20 7762 5535 stephen.reitman@bernsteinsg.com Harry Martin, CFA +44 20 7676 8965 harry.martin@bernsteinsg.com While rising oil prices cool appetite for cars overall ... Auto sales have typically exhibited a ...

Core Insights - The rising gas prices, nearing $4 per gallon, are shifting consumer interest towards electric vehicles (EVs) despite their higher upfront costs [1][5] - Consideration for electrified vehicles has increased to 23.8% of all vehicle research activity on Edmunds.com, marking the highest level recorded in 2026 [2] - High gas prices combined with elevated interest rates are influencing car shoppers to explore alternatives to traditional gasoline-powered vehicles [3] Industry Trends - The trend of increasing consideration for EVs is evident, with data showing fluctuations in consumer interest over recent weeks, peaking at 22.4% on March 2, 2026 [4] - Used EV sales in the US reached 30,879 units in February, reflecting a year-over-year increase of 28.8% and a month-over-month increase of 4.2%, indicating growing consumer appetite for electrified vehicles [4] Economic Factors - The economic rationale for switching to EVs is becoming more compelling, with average annual fuel costs for gas-powered vehicles estimated at $1,700 compared to just $700 for EVs at $4 per gallon [5] - A $1 per gallon increase in gas prices results in a $450 annual increase in fuel costs for internal combustion engine vehicles, while charging costs for EVs are projected to be 60% cheaper [6] Consumer Behavior - Prolonged high gas prices are expected to alter consumer behavior, potentially increasing demand for EVs and impacting sales of high-margin SUVs and trucks [7][8] - Rivian's CEO suggests that sustained high fuel prices will influence consumer choices, particularly as consumers experience higher gas prices over time [8]

Core Thesis - Driven Brands Holdings Inc. (DRVN) is viewed positively due to its strategic focus on high-growth segments, particularly the Take 5 oil change brand, and its efforts to simplify operations and reduce debt [1][6]. Company Overview - Driven Brands is the largest automotive services platform in North America, operating approximately 4,900 locations across various services including maintenance, paint, repair, and collision [2]. - The company has exited underperforming car wash businesses, reducing its leverage from 5.0x to around 3.5x net debt/EBITDA [2]. Growth Potential - Take 5 is the flagship growth engine for DRVN, delivering over 40% return on invested capital (ROIC) on company-owned stores, with strong same-store sales and high profitability [3]. - The brand has a scalable format and an extensive pipeline of about 900 additional locations, supporting long-term double-digit EBITDA growth and potential expansion to approximately 2,000 stores by 2029 [3]. Financial Performance - DRVN's recent resegmented reporting enhances transparency, allowing investors to view Take 5 as a standalone segment, while the US auto glass business represents an emerging growth opportunity [4]. - The company trades at around 8x FY26E EBITDA, which is below peers like Valvoline, despite having superior unit economics and scale advantages [4]. Strategic Initiatives - Proceeds from car wash divestitures and ongoing deleveraging are expected to support a path to 3.0x net leverage by 2026, thereby strengthening the balance sheet [5]. - The company benefits from secular tailwinds from an aging US vehicle fleet and operates in a highly fragmented $350 billion market [5]. Investment Outlook - Driven Brands offers a compelling investment opportunity with multiple catalysts, including the expansion of Take 5, normalization in Franchise Brands, and long-term upside from the US glass business, supporting a potential price target of $30 per share [5].

RT Muskonomy (@muskonomy)🚨NEWS: Tesla sold 485 cars in Singapore in FebruaryTesla reached 12.1% market shareAnd 21.7% of the EV segmentEV adoption hit a record 55.8% in the country. https://t.co/p7oo9TMbzv ...

Industry Overview - The Zacks Domestic Auto industry encompasses companies involved in the design, manufacturing, and sale of various vehicles, including passenger cars, trucks, and electric vehicles [3] - The industry is highly cyclical, closely tied to consumer spending, and is undergoing significant transformation due to heavy investments in new technologies, including electrification and digital connectivity [3] Key Themes Shaping the Industry - Vehicle sales momentum is declining, with February 2026 vehicle sales falling below last year's levels for the fifth consecutive month, attributed to high vehicle prices and economic uncertainty [4] - Geopolitical tensions, particularly between the U.S. and Iran, have negatively impacted consumer confidence and contributed to rising crude oil prices, which have exceeded $100 per barrel [5] - The expiration of key electric vehicle tax credits has led to a sharp decline in EV demand, with Ford reporting a 71% year-over-year drop in EV sales in February [6] - Higher tax refunds from the One Big Beautiful Bill Act may provide a short-term boost to auto demand, although broader demand conditions remain under pressure [7] Industry Performance and Valuation - The Zacks Automotive – Domestic industry currently ranks 150, placing it in the bottom 38% of over 240 Zacks industries, indicating lukewarm near-term prospects [9] - The industry's earnings estimates for 2026 have declined by 51% over the past year, reflecting a negative outlook for constituent companies [10] - The Domestic Auto industry has outperformed the broader auto sector and the S&P 500, returning 81% over the past year compared to 48% and 23% respectively [12] Company Highlights Ford - Ford is adjusting its strategy to focus on profitable hybrids and traditional vehicles while scaling back its EV expansion, emphasizing smaller and more affordable models [18] - The Ford Pro division has become a significant profit driver, with paid software subscriptions rising by 30% in 2025 [19] - Ford plans to invest approximately $1.5 billion in 2026 for energy storage market initiatives and has a strong liquidity position with about $50 billion available [20] - Ford carries a Zacks Rank 2 (Buy), with EPS growth estimates of 40% and 20% for 2026 and 2027 respectively [21] General Motors - General Motors emerged as the top-selling automaker in the U.S. in 2025, marking its fourth consecutive year of market share gains [23] - The company has shifted some production capacity from EVs back to internal combustion engine models in response to slower EV demand [23] - GM's software and services, including OnStar, are becoming increasingly important, with projected deferred revenues reaching about $7.5 billion in 2026 [24] - GM carries a Zacks Rank 3 (Hold), with EPS growth estimates of 16% and 7% for 2026 and 2027 respectively [25]

Group 1: Market Trends - New car registrations in the European Union declined in January, but battery-electric vehicles (EVs) continued to grow their market share [1] - EV adoption trends are crucial for legacy automakers like Ford as they face competition from Tesla and increasing pressure from Chinese manufacturers [1] Group 2: Ford's Vehicle Recall - A potential issue with rear suspension components has been identified, which could affect vehicle handling under certain conditions [2] - The recall affects Explorer vehicles produced between 2017 and 2019, with the rear suspension toe links at risk of fracturing [2][3] - A rear toe link fracture could lead to a loss of steering control, increasing the risk of a crash [3] Group 3: Repair and Notification - Ford plans to start mailing owner letters in early March with instructions for scheduling repairs related to the recall [4] - The recall expands a previous safety action and affected VINs will be searchable on NHTSA.gov starting February 25, 2026 [4] - Ford Motor shares increased by 4.44% to $14.24, nearing its 52-week high of $14.50 [4]

Core Insights - PG&E has reduced electric rates for the fourth time in two years due to accelerated large load growth, although wildfire costs remain a challenge for affordability [1] Group 1: Large Load Growth and Electric Rates - The total large load pipeline decreased from 9.6 GW in September 2025 to 7.3 GW by the end of the year, but new projects are entering final engineering phases [2] - PG&E estimates that it can lower customer electric bills by approximately 1% for each gigawatt of new load added to the system [2] - Rapid adoption of electric vehicles (EVs) is increasing electricity demand in PG&E's service area, alongside expected growth from California's manufacturing sector [2][3] Group 2: Wildfire Management and Capital Plans - There has been a 43% decline in wildfire ignitions linked to PG&E equipment [5] - PG&E's five-year capital plan is set at $73 billion, with no current plans to update it despite potential additional growth opportunities of $5 billion [6][7] - The company will not issue new equity under its current five-year plan but plans to issue up to $4.6 billion in debt in 2026 to maintain investment-grade credit ratings [8] Group 3: Legislative and Policy Developments - The California Earthquake Authority is expected to release a report on wildfire fund reforms on April 1, which may initiate legislative changes aimed at improving wildfire-related legal claims reimbursement [9]

"The whole industry, we were on a path that we were working to get to 40 to 50% EVs by 2030, so now that the regulatory environment has changed and the consumer incentives have gone, there is going to be slower EV adoption," says General Motors CEO Mary Barra. Watch our full interview here: https://bloom.bg/4qJgBIu ...

ChargePoint Conference Call Summary Company Overview - **Company**: ChargePoint - **Industry**: Electric Vehicle (EV) Charging - **Key Executives**: Rick Wilmer (CEO), Mansi Khetani (CFO) Core Insights and Arguments - **Market Position**: ChargePoint is emerging from a challenging period and expects steady growth due to a less competitive landscape and new innovations in the market [2][5] - **Financial Improvements**: Significant debt restructuring has reduced outstanding debt from $340 million to approximately $157 million, extending maturity to 2030 and cutting annual interest expenses by about $10 million [3][43][44] - **Operational Efficiency**: Operating expenses (OpEx) have decreased from nearly $90 million per quarter to the mid-$50 million range, indicating improved cash management [5] - **Growth Strategy**: Focus on partnerships with grid builders like Eaton to lower infrastructure costs and enhance operational efficiency [6][26] - **Market Share**: ChargePoint holds a 70% market share in Level 2 charging in North America and aims to expand its presence in Europe with new product offerings [21][56] Industry Dynamics - **EV Adoption**: The company emphasizes that EV adoption is crucial but is also influenced by charging infrastructure availability and costs [11] - **Competitive Landscape**: The EV charging market has seen a reduction in competition, with many smaller players struggling to secure funding, leading to consolidation [19][20] - **Partnerships**: Collaborations with auto OEMs and energy sector players are essential for enhancing customer experience and driving growth [7][8][26] Financial Metrics and KPIs - **Active Ports**: As of the last quarter, ChargePoint managed approximately 400,000 active ports, which are critical for generating recurring revenue [34] - **Subscription Revenue**: The company reported nearly $170 million in annual recurring revenue from subscriptions, with a gross margin of 63% [34][36] - **Cash Flow Management**: The average cash burn has been halved compared to the previous year, with a focus on reaching cash flow break-even soon [36] Innovations and Product Development - **Next-Gen Charging Solutions**: ChargePoint is developing a next-gen DC charger that separates AC to DC conversion, significantly reducing costs and increasing capacity [27][28] - **Home Charging Solutions**: Innovations include smart panel technology that allows for efficient home energy management, enabling vehicle-to-home power during outages [29][31] - **Software Integration**: The company has integrated software solutions from acquisitions to create a scalable platform for managing public DC fast chargers and fleet telematics [56] Customer Segmentation - **Market Segments**: ChargePoint serves two main segments: fleet (mission-critical electric vehicle operations) and commercial (discretionary charging installations) [22][23] - **Retail Demand**: Increasing EV penetration in retail areas is driving demand for charging solutions, as businesses seek to attract customers by offering charging facilities [24][25] Future Outlook - **Growth Expectations**: ChargePoint anticipates a return to growth, with significant customer wins and partnerships expected to be announced [10][66] - **European Expansion**: The company plans to leverage favorable regulatory conditions in Europe to drive growth, with new products set to launch in the region [56][57] - **Cost Management**: Ongoing efforts to reduce product costs through lower-cost manufacturing and innovative designs are expected to enhance gross margins [45][47] Additional Considerations - **Tariffs Impact**: Tariffs have negatively affected the company's bottom line, but operations in Europe are less impacted due to direct sales [61][62] - **Inventory Management**: ChargePoint is transitioning from high inventory levels to a more balanced approach, expecting to generate cash flow as inventory is sold down [62][63] This summary encapsulates the key points discussed during the ChargePoint conference call, highlighting the company's strategic direction, financial health, and market dynamics within the EV charging industry.

Core Insights - Gary Black, Managing Partner of The Future Fund LLC, has expressed reluctance to short Tesla Inc. despite concerns regarding its valuation, emphasizing that Tesla is a strong company in a thriving business environment [1][4]. Group 1: Shorting Stocks - Black stated that shorting stocks is challenging and typically reserved for companies facing secular demand decline or permanent market share loss, lacking the necessary tech, brand, distribution, or management depth to recover [2][4]. - He clarified that the firm would not short a company merely because it appears expensive; instead, they would choose not to own it [3][4]. Group 2: Tesla's Market Position - Black believes that Tesla's valuation, even at 198 times the adjusted EPS for 2026, does not warrant a short position due to the company's strong market position and the increasing global adoption of electric vehicles (EVs) [4]. - He noted that Tesla's marketing issues are manageable and that the company is likely to resolve challenges related to unsupervised autonomy, which could lead to increased sales [4]. Group 3: Concerns from Other Investors - Former fund manager George Noble expressed concerns about Tesla's stock, citing "irresponsible figures" used by momentum investors promoting the stock [5]. - Investor Michael Burry labeled Tesla as "ridiculously overvalued" but confirmed he does not hold a short position against the company [5]. Group 4: Marketing Strategies - Black highlighted the necessity for Tesla to enhance its marketing efforts, warning that reliance on word-of-mouth and CEO Elon Musk's cultural relevance could hinder its competitiveness against Robotaxi rivals [6].