Bloomberg: Citigroup cut its ratings across the sector, saying it expected vehicle production to recover only in autumn after the devastating earthquake that rocked Japan last month.
Toyota Motor Corp , Nissan Motor Co , Honda Motor Co and others have suspended most vehicle output in Japan since the magnitude-9.0 earthquake on March 11 disrupted parts supply, and the impact is spreading overseas as parts inventory runs out. "We do not think the fall in earnings and slowness of the recovery (in vehicle production) have been fully priced in yet," Citigroup auto analyst Noriyuki Matsushima wrote in a report. "While some investors may be tempted to position for a recovery in the (October-March) second half and out, the full extent of damage to the supply chain and production disruption from the power outages is being underestimated by the market, and we would avoid the sector as things stand," he added. Matsushima now rates all automakers "sell"
