European equities open on a cautious footing, with published research flagging near-term weakness in the DAX and a more durable bear case building around Germany's big three automakers.
Analysts argue the DAX is set to open slightly lower, slipping below 24,900, citing soft sentiment, central bank uncertainty abroad, and fresh volatility in autos after BMW's profit warning. That warning is also flagged in recent research as a key catalyst for broader index softness — making BMW the single most market-moving European name today.
On the autos themselves, one camp of analysts lays out a pointed bearish case across BMW, Mercedes-Benz and Volkswagen. They note BMW's China revenues are seen collapsing from roughly $41bn in 2022 to about $24bn by 2026, with margins potentially compressed toward 1%. Mercedes-Benz, they argue, remains stuck in multi-year weakness with no clear catalyst. Volkswagen trades at just 0.1–0.2x sales with revenues falling and no visible profit recovery.
The common thread in this research: Chinese EV competition is commoditising the premium segment, squeezing European brands top and bottom.