Tesla made headlines in 2022, but the top-performing auto stock had nothing to do with EVs

This year it wasn’t just which auto maker stock did the best. It was about which stock managed to survive some of the worst selling pressure of the year.

Later A sharp rise in auto stocks In 2021, the year proved to be challenging with the EV startup bubble popping, low vehicle inventory and rising interest rates. This was in addition to fears of a recession and overall “demand destruction” for sale to the industry.

Many of the world’s largest automakers did well financially this year, But it wasn’t enough to stave off external economic concerns that his most profitable days may be behind him.

“We foresee a challenging FY23 for auto earnings on declining demand (higher rates), deflation (lower price/mix) and an unfavorable shift in the supply/demand balance for EVs,” Morgan Stanley analyst Adam Jonas wrote in an investor note. Preparing approach. earlier this month.

The FactSet Automotive Index, which includes automakers and aftermarket parts, is down nearly 38% so far this year as of Tuesday’s close. All major automakers and EV startups experienced double-digit declines this year — partially or completely offsetting their gains in 2021.

Many times promising EV startups were among the biggest losers, as some faced capital troubles or couldn’t get into production as quickly as they had hoped. Rivian, lucid, Kanu And Nikola experienced 76% decline or more year to date.

Traditional automakers were able to control their stock declines better than EV startups. But America’s largest automakers — General Motors And ford motor – Both experienced declines of more than 40%, barring any surprising rallies towards the end of the year. other like stellar, Nissan, toyota And Volkswagen declined by more than 25%.

The company with the smallest decline was FerrariWhich is down only about 18% year to date — making it the best-performing automaker stock of the year.

Who ran that show? For starters, the iconic maker of high-end sports cars isn’t like other automakers: It’s expected to sell about 13,000 jewel-like sports cars by the end of the year — fewer than giants like General Motors sell a day. But these iconic cars go out the door at an average selling price of about $322,000, according to FactSet estimates.

Even at those prices, Ferrari’s waiting list is long. The company limits its annual production to maintain its pricing power and exclusivity, a happy situation that gives Ferrari exceptionally strong profit margins and ensures that its factory is unlikely to be idled anytime soon. Is.

Ferrari CEO Benedetto Vigna said during Ferrari, most Ferrari models were sold by the beginning of November third quarter earnings callAnd he anticipates no problem with demand in 2023 – no matter how the world’s economies behave.

Vigna has good reasons for that approach. Ferrari has several new models on the way to keep that waiting list long, including its first SUV-like vehicle, a sleek V12-powered four-door. called purosangue Even at a price that starts at around $400,000 in the US – and even for a four-door Ferrari – demand is fierce. Although Ferrari won’t start shipping the Purosangue for a few months yet, the company temporarily stopped taking orders last month after selling out the first two years of production.

“The company’s focus on the unparalleled quality and performance of its vehicles is unwavering, and it has built a track record of resilient financial performance as well as significant intangible brand value and a true luxury position,” BofA Securities analyst John Murphy told investors. ” Note dated December 13, reiterating a buy rating and $285 price target on Ferrari.

then there is Tesla, which has proven to be one of the best automotive stocks for investors in recent years, thanks to Wall Street’s techno-like valuations. Shares of the EV maker have declined over 68% year to date.

more of Tesla shares fall has come since the CEO Elon Musk acquired the social media platform Twitter. The stock is down more than 50% since the deal closed on October 27.

Oppenheimer analyst Colin Rush said, “We believe that the growing negative sentiment on Twitter could be prolonged, limiting its financial performance and becoming an ongoing drag on TSLA.” it is written in a note Downgrading the stocks from Outperform to Underperform in the month.

Wall Street analysts expect 2023 to be another choppy year for automotive stocks. Here’s how legacy automakers, as well as top emerging EV startups, performed this year.

• Ferrari (Race): -18%
• Stellantis (STLA): -25%
• Toyota (TM): -26%
• Nissan (NSANY): -35%
• General Motors (GM): -43%
• Volkswagen (VWAGY): -46%
• Ford (F): -46%
• Fischer (FSR): -57%
• Tesla (TSLA): -68%
• Child (NIO): -68%
• Lordstown (Ride): -69%
• Nikola (NKLA): -75%
• Rivian (RIVN): -82%
• Clear meaning (LCID): -83%
• Canoo (GOEV): -86%

– CNBC Michael Bloom contributed to this report.