Weekly Drive-By: European Automotive Credit

Research evidence excerpt

Weekly Drive-By: European Automotive Credit

J P M O R G A N Europe Credit Research

16 June 2026

Weekly Drive-By

European Automotive Credit

• News wise, it has been relatively quieter for the Automotive space following Europe Corporate Credit - Autos &

the 1Q26 earnings round. Meanwhile, the JP Morgan Automotive team hosted Auto Parts (HY) and Gaming

its annual conference including a Credit Panel on June 2nd. The key message Jemma Permalloo, CFA AC

we took away was the shift in how rating agencies are positioning themselves (44 20) 7134-8153

from last year; we understand that S&P favours and sees Parts suppliers as jemma.permalloo@jpmorgan.com

having better credit prospect than OEMs’. The change in view is mainly J.P. Morgan Securities plc

driven by a) restructuring actions that have been undertaken by parts suppliers,

b) cancellation of a number of loss making contracts by suppliers and c) the

tariff burden that was not eventually passed on to suppliers, contrary to market

expectations. To put that into context, 50% of OEMs under S&P’s coverage are

on negative watch, only 30% of parts suppliers. Specific to issuers, we asked

the rating agencies for their views on Stellantis (STLA) which remains ever

topical. For S&P, the CMD gave a sense of déjà vu, a reminder of the original

merger but the event missing some details. The rating agency estimated there

was a lack of clarity on the partnership with Leap Motor - and while the Dong

Feng JV was new news, it was viewed as not having worked perfectly with

other OEMs historically. Moody’s acknowledged Stellantis’ ambitious plan,

caveating that future rating/outlook changes will depend on execution. S&P

remained firm on its view that 2027 is the earliest it will be reviewing the rating