General Motors Company (GM), Ford Motor Company (F), Toyota Motor Corporation (ADR) (TM): 3 Automakers With Heavy Chinese Exposure

The company’s manufacturing expertise is among the best in the industry, and that is important during a time when stricter environmental laws are increasing costs for automakers. This efficiency of productivity could put Toyota Motor Corporation (ADR) (NYSE:TM) ahead of the competition when it comes to having low operating expenses. While Morningstar has given the company’s stock a fair value outlook at $119 and the company is currently priced at about $124, I think that the longer-term outlook is much more promising. As relations with China continue to improve, so will sales to the nation.

China is the place to be

The Chinese passenger vehicle market is set to increase by about 8.5% to 16.8 million this year, according to a report from the China Association of Automobile Manufacturers. The report goes on to state that the commercial-vehicle purchases will likely rebound from 2012 when it experienced a 5.5% contraction. That contraction moved sales to about 3.85 million vehicles.

The coming improvement means that companies which are already weighted in the Chinese economy will likely see greater profits throughout this year. Getting in now before these companies report quarterly earnings will set you up nicely to realize the gains these firms have realized over last year. And as a bull in the Chinese economy, I see investing in companies with solid exposure to these nations to be sound investments.

The article 3 Automakers With Heavy Chinese Exposure originally appeared on Fool.com and is written by Phillip Woolgar.

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