AUTO & TRANSPORT ROUNDUP: MARKET TALK

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.

1338 ET -Donald Trump’s proposed one-year cap of 10% on credit card interest rates would “would upend the whole credit card industry,” Delta CEO Ed Bastian says on a call with analysts. Bastian says it’s too early to contemplate how the rate cap would even be implemented and would have to withstand legal scrutiny. “It’s way early innings, so it’s really hard to speculate,” he says. The CEO adds that the cap would restrict lower-end consumers from having access to credit. Delta offers several co-branded credit cards through American Express, which are typically aimed at higher-earning, affluent travelers. ([email protected])

1329 ET – The World Cup being largely hosted in the U.S. this year can hopefully break the “international logjam” of inbound travel that’s been a pain point for domestic carriers over the past year, Delta CEO Ed Bastian says on a call with reporters. “You’ll have hundreds of thousands of international visitors, many of whom may be, for the first time, coming to the U.S.,” Bastian says. The slowdown in travel to the U.S. has been attributed by analysts to the Trump administration’s immigration policies, trade disputes and divisive political rhetoric, along with a relatively strong dollar that has made tourism in the U.S. more expensive. ([email protected])

1322 ET – Delta Air Lines’ earnings outlook, which came in shy of analysts’ estimates, reflects the fact that the airline isn’t allowing for much optimism this year, Melius Research analysts Conor Cunningham and Patrick Coleman say. The guidance sets a reasonable bar with ample room for upside if U.S. domestic travel demand firms up, Cunningham and Coleman say. In 2025, many airlines had to cut guidance after tariff announcements poked a big hole in travel demand. “Airlines will speak to improving underlying trends,” the analysts say, “but will bake in only what is visible and not pull forward further optimism as visibility declines.” ([email protected])

0957 ET – BRP is a clear winner in powersports for 4Q, Citi analyst James Hardiman says in a report. The analyst sees the company closing 2025 with strong momentum, driven largely by the early popularity of its new side-by-side model. Hardiman bases the view on Citi’s recent powersports channel checks, data analysis, and management conversations. “We believe that BRP finished 2025 on the strongest of notes, gaining share in a solid off-road vehicle industry due in large part to the early popularity of the new Defender model,” Hardiman says. He figures that the off-road vehicle industry retail was up mid-single digits for 4Q, with BRP retail sales up over 20% quarter-to-date. ([email protected])

0912 ET – BMW’s fourth-quarter will likely be characterized by inventory reduction, UBS analysts write. The bank forecasts a 4.0% auto EBIT margin in the quarter and slightly positive free cash flow. For 2026, it now expects BMW to guide for a flattish top line and 4%-6% auto EBIT margin. “We previously considered it more likely that BMW would guide for slight top line growth and 5%-7% auto EBIT margin.” While fourth-quarter China volumes have been in line with guidance, the whole market is showing signs of a slowdown, and possibly management will prefer a more conservative approach, it adds. The bank downgrades BMW to neutral from buy, mainly driven by 2025 share price performance. It lowers its price target to 93 euros from 95 euros. Shares fall 2.3% to 88.44 euros. ([email protected])

0845 ET – Ferrari has toned down expectations, and surprise potential is limited, HSBC analysts write. The bank says it has been a painful three-months since management set out their plans to 2030, with growth metrics coming in below expected. Model changeovers and the ramp-up of F80 deliveries point to a soft start to 2026. Meanwhile, the narrative from management focuses on headwinds, which could exacerbate concerns about deeper problems. It expects Ferrari to guide for a 2026 adjusted EBIT margin of 29%-30% and industrial free cash flow of 1.4 billion euros. “Given limited potential for year-on-year margin improvement and surprise potential we downgrade Ferrari to hold from buy.” It cuts its target price on the stock to 345 euros from 415 euros. Shares fall 0.8% to 320.60 euros. ([email protected])

0846 ET – The December CPI report looks quite a bit like economists had forecast, with prices rising by 0.3% last month and by 2.7% in all of last year. Core goods prices were flat, with increases in apparel costs canceled out by falling prices for used cars and by flat new-car prices in December. Core services prices rose by 0.3% last month, with shelter costs rising by 0.4%, medical services rising by 0.4% and transportation services rising by 0.5%. Airfares climbed by 5.2% in December, although data challenges caused by the government shutdown late last year may have distorted some month-over-month November-December comparisons. ([email protected]; @mattgrossman)

0549 ET – An agreement on Chinese auto imports into the EU would help BMW, VW and Volvo Car import more Chinese-made cars into Europe, Citi analysts write. However, it would also accelerate competition and further devalue European manufacturing capacity, Citi says. The EU and China have reportedly agreed to replace the July 2024 EU tariffs on Chinese electric-vehicle imports of up to 48% with a new “minimum price” commitment, the bank says. The new plan isn’t yet fully defined and there are no details on what any price commitment levels will be. The bank doesn’t believe this deal can in any way help European automakers in China, where market-share declines remain inevitable, it says. “We see this as another big win for Chinese original-equipment manufacturers.” ([email protected])

0132 ET – The EU-China progress on auto tariffs could be marginally positive for Chinese automakers with large European exposure, Citi analysts write in a note. The Sino-EU tariff negotiations look to be heading in a constructive direction, with EU and China agreeing to replace the July 2024 EU tariffs on imports of China EVs with a new minimum price commitment, they add. In the domestic China market, Citi anticipates BYD’s large-battery plug-in hybrid product launch will bring them early-mover advantages in the facelift cycle after Lunar New Year, they add.([email protected]; @ivy_jiahuihuang)

2144 ET – Chinese automakers with EU exposure will likely benefit the most from recent progress in advanced talks between China and the EU on price commitments for full electric vehicles, DBS analysts say in a note. The two sides aim to address subsidy concerns without relying solely on tariffs, DBS adds. Reduced tariff risks can enhance export competitiveness, improve profit margins and support international growth strategies amid softening domestic demand, DBS says. Companies including SAIC, BYD, XPeng, Leapmotor and Geely will likely benefit the most given their higher EU exposure. In contrast, domestically focused players like Li Auto and NIO may see milder effects, they add. DBS’s top picks are Geely and XPeng, given their higher volume growth and broad mass-market product portfolio, the analysts say. ([email protected]; @ivy_jiahuihuang)

1958 ET – Kia’s lagging shares could catch up with the strong gains of its parent auto group in 1H, Daiwa Capital analysts Henny Jung and Yoonkie Bae write in a note. The South Korean carmaker’s earnings recovery and participation in the parent Hyundai Motor Group’s physical artificial-intelligence investments could underpin Kia’s anticipated catch-up, the analysts say. Kia is likely to reduce tariff costs by increasing its U.S. production and improve profitability by expanding the share of hybrid electric vehicles in its product mix, they say. Daiwa raises its target price for Kia by 14% to KRW160,000 and keeps a buy rating. Shares are 3.4% higher at KRW133,700. ([email protected])

2026-01-13T11:50:41Z