European Auto Manufacturers and Auto Parts & Equipment: 2Q26 Earnings Preview: Guidance Flat, Stocks Up?

Research evidence excerpt

European Auto Manufacturers and Auto Parts & Equipment: 2Q26 Earnings Preview: Guidance Flat, Stocks Up?

European Auto Manufacturers and Auto Parts &

Equipment

17 July 2026 Citi Research

Figure 1. 2Q26 Earnings Calendar

Major EU Auto Reporting Dates & Relevant global Bellwether

© 2026 Citigroup Inc. No redistribution without Citigroup’s written permission.

Source: Citi Research, Bloomberg

OEM Narrative: Post the BMW profit warning in June, expectations for European

OEM earnings have gone from “low” to “very low indeed”. BMW obviously re-

ignited the debate over the rather obvious acceleration in China market share

declines for legacy OEMs exposed to the sharper decline in China CIE sales – which

accounted for the bulk of BMW’s €3bn FY26E guidance reduction. BMW however

also cited lower global consumer sentiment, rising pricing pressures, FX, and raw

materials. In the pre-close calls, many of these themes repeated, with MBG and

VW also suffering very extreme YoY China sales decline in Q2 26, and warning of

rising pricing pressures. On the other hand, it is also clear that EU and US sales

have remained strong, OEMs have clearly pushed US sales to offset some of the

declines in China, tariff headwinds have stabilised vs the peak tariffs in Q2 25, and

FX headwinds are maybe less severe than previously feared. Whilst we see most

OEMs reporting Q2 26 EBIT margins nearer the low end of their guidance ranges,

most of the pre-closes suggest that, unlike BMW, most OEMs will keep guidance at

this stage. Whilst we would like to think that this means that they will get some

reward for “beating (low) expectations”, recent trading trends suggest that

“structural shorts” will simply remain short – notwithstanding any “less bad”

quarters.