Financial Assessment of Global Automotive OEM Industry
Eurozone crisis is increasing borrowing costs, thereby negatively impacting the demand for automotives. In emerging economies, inflation has impacted sales.
Government regulations with respect to exhaust emission, noise, safety and pollution for plants, and customs also actively impact this industry.
Four out of the top 5 companies in the passenger cars segment are from Asia, reflecting the financial strength of companies in this region. On the other hand, out of the top companies in the commercial vehicles segment are listed in NYSE or NASDAQ, indicating the strength of US companies in this segment. Only one company from Europe (Piaggio & C. SpA) features in the top in the passenger segment.
Two-wheeler segment provides the highest portfolio return. This risk adjusted return performance is also the highest as measured by the Sharpe ratio. The ratio for this segment was
About this report
The research analyzes the financial health of global automotive original equipment manufacturer (OEM) industry. This includes passenger cars, commercial vehicles, and two wheelers. The research provides an insight into company operations and helps understand the sources and uses of cash. There are various ratios used in the analysis. The financial position of a company can be ascertained in terms of its profitability, liquidity, and solvency. For instance, the interest coverage ratio measures the ability of a company to cover interest expenses through operating profits. This gives an insight into the solvency position. The study period is 2008 to 2013.
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