Last mentioned: Mar 26, 2026
Morgan Stanley Warning
Analysts warn that high oil prices could scuttle the industry's shift toward high-margin SUVs.
Ceasefire Rejected
Iranian leadership rejects President Trump's ceasefire offer, signaling a prolonged conflict.
Morgan Stanley Warning
Analysts warn that prolonged high oil prices will scuttle the industry's SUV-heavy strategy.
Iran War Begins
Conflict breaks out, leading to the closure of the Strait of Hormuz and oil supply disruptions.
Iran War Begins
Conflict breaks out, leading to the closure of the Strait of Hormuz and oil price spikes.
Record Sales Peak
Tariff fears and dealer incentives drive record sales for Ford and GM in H1 2025.
Record Sales Year
Tariff fears and dealer incentives drive record sales; SUV share hits 52%.
SUV Market Share at 46%
Post-pandemic demand accelerates the shift toward larger, higher-margin vehicles.
SUV Market Share at 38%
SUVs begin a steady climb in popularity as fuel prices remain stable.
A prolonged spike in oil prices, driven by the Iran War and the closure of the Strait of Hormuz, is threatening the high-margin SUV strategy of major US automakers. Morgan Stanley warns that if fuel prices remain elevated for over six months, consumers will likely pivot toward cheaper, more fuel-efficient models, eroding the profitability of Ford and GM.
A Morgan Stanley analysis suggests that a prolonged spike in oil prices, fueled by the ongoing Iran War, could force a significant shift in consumer behavior away from high-margin SUVs. As energy costs rise, the 'Big 3' automakers face a strategic crisis after pivoting production capacity toward larger vehicles and away from less profitable electric models.