Jason Hall

If there's anything that we didn't learn from Japan, if we didn't learn from South Korea, we better learn here with the Chinese EV story.

Most automakers are price takers.

And if you're not the low-cost leader, you have nowhere to go when things are bad.

Because of that, if nothing else, this industry is in the too hard pile for me.

It's just putting in the effort to try to find a little bit of alpha is just not worth the time, frankly, to me.

Because as Lou said, there's other places to invest where there's better opportunities and the lift is a lot lighter.

With that said, I do think

There are some exceptions.

Ferrari is a good one, ticker RACE.

Yes, it builds cars, but this is an elite luxury scarcity business.

The cars that it builds are some of the most desirable vehicles on Earth.

Then it makes sure to undersupply the market.

That's such an important part of the formula.

Stock trades for about 32X earnings.

That sounds expensive, but you look at the margins and the cash flows, it's actually pretty attractive.

It's actually a level, if you go back to 2020, the stock has only traded out for a few months in the past

six years.

Another area of the auto industry that I think is compelling is, you find really good operators, like Lou was talking about, and you can look at retail auto parts.

O'Reilly Automotive, for example, ticker O-R-L-Y.

It's getting interesting again.