What if EV price wars and China competition push European auto issuers toward default?
European auto and supplier credit deteriorates as EV price wars, China competition and weak demand compress margins, pushing several issuers toward HY and default.
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The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 1–3 years horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. Loading the probability audit trail…
What it would mean
If this plays out, it is a risk-off shock. European auto and supplier credit deteriorates as EV price wars, China competition and weak demand compress margins, pushing several issuers toward HY and default. The trigger decomposes into signed root‑shocks — China growth ▼ · Credit spreads ▲ · Financial conditions ▲ · Recession signal ▲ · Risk appetite ▼ — which propagate through our causal graph to the markets below.