Automakers released second-quarter sales figures and the market split cleanly into two groups: companies that sell hybrids and companies currently updating their resumes. Toyota moved metal. Ford moved metal. Honda moved metal. Stellantis did not move metal because Stellantis spent the last three years building RAM trucks for guys named Derek who already own four RAM trucks.
The hybrid advantage is so pronounced that CFOs are now in emergency meetings explaining why they ignored this trend since 2008. These are the same executives who told shareholders that EVs were the future and hybrids were for cowards. They were half right. EVs are the future. Just not their future.
Retail traders saw these numbers and immediately started Googling "which car company makes hybrids" as if this information was not freely available on every automobile manufacturer's website for the past fifteen years. They will buy Toyota stock at the top. They will sell it at the bottom. They will blame Jerome Powell.
The technical picture is irrelevant because car sales are a lagging indicator of consumer preference, which is itself a lagging indicator of gas prices, which is a lagging indicator of geopolitical chaos, which is a lagging indicator of decisions made by people who do not care about your Robinhood account. But sure, draw your little lines on the chart. Put a rectangle around the part where you lost money. Call it a bull flag.
Second-quarter sales data tells us what happened three months ago to people who signed financing agreements they should not have signed. It tells us nothing about tomorrow. The hybrid surge will last until gas drops to two dollars a gallon or until every automaker floods the zone with hybrid inventory and destroys their own margins. Whichever comes first.
Your move is to chase this news into a sector that has already priced it in, hold through the next earnings miss, then tell yourself you are long-term investing.
Photo by Zoshua Colah on Unsplash
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