The car market is decidedly mid right now. It isn't great, but it's stable; U.S. investors seem OK with that.
On Friday, airbag and safety-component supplier Autoliv reported weaker-than-expected second-quarter earnings.
The company reported adjusted earnings per share of $2.43 from sales of $2.8 billion. Wall Street was looking for $2.45 from sales of $2.8 billion. Earnings were two cents light. A year ago, Autoliv reported earnings per share of $2.21 from sales of $2.7 billion.
There is growth, but it is drying up. Autoliv expects no organic growth in 2026. Sales will rise a little on positive foreign exchange, and profit will rise a little. That guidance is essentially unchanged from April.
Still, Autoliv stock was down 5.6% at $118 in premarket trading, while S&P 500 futures were down 0.8%.
The small miss might have done it, but the company's outlook for global light vehicle production could be the main catalyst for the early decline. Autoliv changed its forecast to down 2.5% year over year from down 1%.
The global car market is just a little weaker than it was at the start of the year.
That slow erosion hasn't been enough to spook investors in the U.S. yet, for some good reason. Most of the pain in the auto market is being felt in China and Europe. Coming into Friday trading, shares of Stellantis, Volkswagen, and Mercedes-Benz were down an average of 20% over the past three months. General Motors shares were roughly flat. Ford Motor stock was up 14%. And shares of suppliers Autoliv, Magna International, Lear, and Visteon were up 17% on average.
Rising stock prices with falling light vehicle production might feel like complacency, but it's also a reflection that the U.S. remains the healthiest car market in the world.
Americans are expected to buy almost 16 million cars in 2026, similar to 2025. Growth is better, but in a declining global market, stability looks pretty good.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
July 17, 2026 09:07 ET (13:07 GMT)
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