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The global semiconductor shortage, supply chain crisis, and labor shortages have wreaked havoc on the auto manufacturing industry. However, massive government and private investments to boost semiconductor production should gradually ease the problem and help auto manufacturers boost production. Furthermore, the rising demand for electric vehicles (EVs) due to rising oil prices and climate change concerns should drive the industry’s growth. In addition, traditional automakers might benefit more than specialist EV manufacturers because of their broad portfolio of cars and market dominance. According to a report by Market Research Future, the automotive industry is expected to grow at a 4.5% CAGR between 2021 -2028. Therefore, both VWAGY and TM should benefit.
TM stock has gained 4.1% in price over the past month, while VWAGY has returned 1%. However, VWAGY’s 49.9% gains year-to-date are significantly higher than TM’s 20.3% returns. Moreover, VWAGY is the clear winner with 62.2% gains versus TM’s 32% returns in terms of the past year’s performance.
