New York Auto Show Winners and Losers

by Jim Woods | March 28, 2013 9:24 am

New York Auto Show Winners and Losers

It’s auto show time again, which means new vehicles making their 2013 debut at the Jacob Javitz Center in New York City.

In January, I asked myself whether investors should even bother paying attention to auto shows[1]. It seemed to me that, while automakers tend to make a big splash in the media with the new models and concept cars, these events usually are more intended to get car enthusiasts excited and to generate some marketing buzz.

This year, however, the New York Auto Show could prove to be more than glitz and glamour, especially for the stocks of automakers generating the biggest buzz with new luxury models.

Topping the list on this front is General Motors (NYSE:GM[2]), with its newly designed Cadillac CTS. The Cadillac brand has been a big hit for GM lately, and the newly designed CTS already is capturing a lot of interest among the automotive literati.

The Cadillac brand has stomped its domestic rival, Ford’s (NYSE:F[3]) Lincoln brand, and GM is now setting its sights on competing with luxury giants Mercedes and BMW. Based on the buzz I’ve heard among car guys, it might just succeed in taking sizable market share from the German stalwarts.

General Motors also is generating some favorable press with its Buick brands, such as the newly designed LaCrosse and Regal models. The Buick division has made a rather impressive comeback of late, thanks in small part to humorous advertisements featuring former NBA great Shaquille O’Neal.

The other company whose new luxury offering’s are generating interest is Volkswagen (PINK:VLKAY[4]) via its Audi brand. The sleek new Audi A3 sedan could prove its mettle as a top seller for VW in the very hot luxury compact segment of the auto market.

Other brands making a splash in New York City this year are Toyota (NYSE:TM[5]) with its new designed Highlander mid-sized SUV. The Highlander has been a big winner for the Japanese auto giant, and last year it became the company’s second best-selling SUV, behind the Rav4. The Highlander is set to go head-to-head with Honda’s (NYSE:HMC[6]) Pilot, and Ford’s Explorer.

Finally, there’s usually one or two models from each auto show that lay a proverbial egg. This year, my vote for biggest disappointment is the newly revised Jeep Cherokee from Chrysler, a division of Fiat (PINK:FIATY[7]). Shortly after the newly redesigned 2014 Cherokee was unveiled, social media sites started buzzing[8] about how far the the SUV had strayed from its iconic look. “No more tough’n’rough,” was a common lament among Jeep purists.

While I tend to concur with this assessment of the new Jeep, it remains to be seen if the new, heavily European-influenced Cherokee will be a hit with buyers. My guess is it won’t, but that’s just one car guy’s opinion. We’ll have to see how the numbers tally up in the months to come.

The bottom line for investors is that this year’s New York Auto Show could translate into a big win for GM. So, if you are long the stock, or if you are thinking about getting long the stock, now might be a good time to take advantage of a potentially bullish ride.

As of this writing, Jim Woods did not hold a position in any of the aforementioned securities.

Endnotes:
  1. should even bother paying attention to auto shows: http://investorplace.com/2013/01/should-investors-even-pay-attention-to-auto-shows/
  2. GM: http://studio-5.financialcontent.com/investplace/quote?Symbol=GM
  3. F: http://studio-5.financialcontent.com/investplace/quote?Symbol=F
  4. VLKAY: http://studio-5.financialcontent.com/investplace/quote?Symbol=VLKAY
  5. TM: http://studio-5.financialcontent.com/investplace/quote?Symbol=TM
  6. HMC: http://studio-5.financialcontent.com/investplace/quote?Symbol=HMC
  7. FIATY: http://studio-5.financialcontent.com/investplace/quote?Symbol=FIATY
  8. social media sites started buzzing: http://www.foxbusiness.com/news/2013/03/27/2014-jeep-cherokee-racy-design-stirs-up-social-media-storm

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