It's a great time to be in the auto industry with strong demand and a shortage of new cars. It's leading to a boom in profits for companies in the industry like Advanced Auto Parts (AAP), Cooper Tire & Rubber (CTB), and Toyota Motor Corporation (NYSE:TM).The automobile market has taken quite an interesting turn this past year. Both new and used vehicles are fetching big bucks due to chip shortages. The price of a new or used ride will likely continue to increase or at least stagnate until the chip shortage is worked out, possibly at some point in the year ahead. If you don't have auto stocks in your portfolio, now is the time to add at least one. Even those who have one or two auto stocks in their holdings should consider establishing another position in one of the industry's top players simply because demand for automobiles continues to increase as people begin to return to work and life as usual.
The chip shortage will eventually be worked out. The question is which stocks in the auto industry are most likely to pop as vehicle supply remains low while demand continues to spike. Let’s take a quick look at three auto stocks racing to new highs in Advanced Auto Parts (AAP), Cooper Tire & Rubber (CTB), and Toyota Motor Corporation (TM).
AAP is one of the top players in the auto aftermarket industry. The company sells auto replacement parts, accessories, and other vehicle-related sundries such as maintenance items, batteries, etc.