BofA Analyst Advises Detroit Automakers to Exit China Amid Rising Local Competition

Bank of America analyst John Murphy has urged Detroit automakers General Motors (GM), Ford, and Stellantis to exit the Chinese market due to intense competition and declining profitability. Murphy argues that the automakers should focus on their core, profitable regions, particularly North American trucks, to fund their transition to electric vehicles (EVs). The rise of local Chinese automakers like BYD and Geely has significantly reduced market share and profits for these U.S. companies. Moreover, geopolitical risks, including potential tariff increases by the U.S. on Chinese-made EVs, further complicate the business environment. Despite some optimism from GM executives about regaining market share through new EVs, Murphy emphasizes that the strategic focus should be on regions where they are currently profitable.