The 30 lowest rated companies in the ETFI Global Auto Makers Index and short ETF proposal lost an astonishing 63.9% in market value over the past year, compared to a loss of 37% each for the S&P 500 SPDR (SPY) and the Consumer Discretionary Sector SPDR (XLY). The index includes companies with market caps over $150M U.S. Dollars which are active in the following business segments: auto/truck makers, motor sports/recreation – e.g. Polaris (PII), motorcycles – e.g. Harley Davidson (HOG), and recreational vehicles – e.g. Winnebago (WGO).
The accompanying table includes statistics for the index, along with the top/bottom three companies in terms of trailing 52-week stock price change. Volkswagen (VLKAY) bucked the dismal industry performance with a biotech-like gain of over 150% in the past year. Also, two Korean car makers, Kia Motors (Korea: 000270) and Hyundai Motor (Korea: 005380), made the top three stock price performers with returns of 8.1% and -7.4%, respectively.
The bottom three companies over the past year include General Motors (GM), Renault (RNSDF), and Ford (F). Despite the poor performance over the past year, the companies in the ETFI Global Auto Makers Index face significant challenges, including the global economic slowdown, the decreased spending power of consumers, the availability of credit for auto loans, and legacy costs for pensions and healthcare.
$24.48 (11/02/08)
