In this episode of the Know More. Risk Better. podcast, the conversation explores how cyclical weakness and structural disruption are reshaping the outlook for European autos and influencing credit markets. Logan Miller is joined by Jim Williamson to discuss the growing impact of Chinese EV competition on market share, margins, and the long-term positioning of European OEMs, alongside lessons from historical US-Japan auto competition.<br><br>They examine the divergence between credit and equity signals, the role of protectionism and cost pressures, and how shifting fundamentals could affect investor risk sentiment. The episode delivers a clear, forward-looking perspective to help investors navigate credit positioning in an increasingly complex autos landscape.

Europe Autos Reset: Competition, Costs and Credit Risks

Know More. Risk Better.

# Full Transcript

**Podcast:** Know More. Risk Better.

## Participants

- **Logan Miller** (CreditSights)
- **Jim Williamson** (CreditSights)
- **Jim Williamson** (CreditSights)

## Transcript

Welcome to Know More, Risk Better, a CreditSights podcast. Across the global strategy team, we aim to make sense of the macro and the micro, highlighting opportunities and the risks facing the fixed income markets. As the macro makes headlines, we leverage our network of experts across Fitch solutions to better understand economic trends, rates, gyrations, geopolitical events, and how these factors impact corporates.

At Credit Sites, we understand that credit investing comes down to picking winners to generate alpha and avoiding losers. Our team of over 100 analysts across the US, Europe, and Asia provide unmatched sector expertise and fundamental knowledge. In our weekly podcast, the strategy team offers a look at the conversations we have with our colleagues, including analysts, fellow strategists, economists, and leverage finance market experts. If you want to know more so that you can risk better, you'll want to give this podcast a listen.

Welcome back everybody to the Credit Sites Know More, Risk Better podcast. My name is Logan Miller. I'm the head of European strategy based in London, and I'm pleased to be joined today by my colleague, Jim Williamson, who is a up and coming star or already a star at CreditSights. He's our head of European autos, also based out of London, and today we're going to go through a deep dive into some work that Jim has done in recent weeks regarding the auto cycle in Europe

and looking back at historical precedents as it relates to mid to late 1990s as it relates to Japanese competition with US auto manufacturers and how the crowding out of Chinese OEMs is playing out for European autos. But Jim, thanks for joining us. I know you've been on this podcast a number of times, so it's always interesting to have you get your perspectives. Happy to be here. It's always an interesting thing to have a chat about.

Yeah, and this thing right now, obviously the market has been kind of whipsawed in the last several months. I saw obviously spreads gap wider in March, and that's really kind of since made a big U-turn as it relates to credit spreads. We got out to almost 100 basis points on Euro IG spreads before really kind of coming back towards the year-to-day tights. We're now just sitting three basis points off of the tights at 74 basis points at the index level.

We've had a turnaround story from the market perspective since March. And to this point, we haven't really seen a whole lot of major indications that there's kind of more pronounced credit stress within the system as a result of the Iran conflict. But obviously we've had some announcements in your space, particularly late last night with BMW. I guess you would elaborate on kind of what we saw from them.

Yeah, I think Autos is actually in quite an interesting spot bec...

Europe Autos Reset: Competition, Costs and Credit Risks

Transcript

Built for investment professionals

Every day you wait, your competitors are finding
edge in conversations you're not hearing.

Europe Autos Reset: Competition, Costs and Credit Risks

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.