Cost cutting is back in focus after Lucid Group announced plans to trim about 18% of its U.S. workforce, target annualized savings of roughly $158 million, and suspend financial guidance while it reassesses demand and inventory. When a high profile automaker talks openly about efficiency, investors often look for companies that already put discipline and balance sheet health at the center of their story. This article looks at how that theme connects to our Automotive Industry, Cost Efficiency Plays screener and describes 3 stocks that appear positively exposed to the same pressures shaping Lucid Group’s next chapter.

Gentherm (THRM)

Overview: Gentherm is a US based manufacturer that supplies automakers and hospitals with thermal management and comfort products, from heated and climate controlled car seats and steering wheels to patient temperature management systems used in surgery and intensive care. Its technology sits inside vehicles and medical equipment, aiming to improve comfort, safety and energy efficiency for end users.

Operations: Gentherm generates the vast majority of its revenue from Automotive at about US$1.49b, with a much smaller Medical segment at roughly US$49.3m, supported by a wide geographic footprint led by the United States and China.

Market Cap: US$1.10b

Gentherm deserves attention from investors looking for cost focused auto suppliers because it already runs many of the efficiency plays others are now talking about, from footprint consolidation to standardized factory metrics. The company sells comfort and wellness features that automakers keep adding even as they scrutinize every dollar, yet faces real pressure from a low 3.2% ROE, a recent large one off loss of US$36.1m and reliance on external debt. With Q1 2026 back in the black at US$4.22m of net income and management leaning hard into margin improvement, the core question is whether Gentherm’s discipline can outweigh its funding and execution risks.

Gentherm’s push from a one-off loss to profit could be the start of a quiet earnings reset, but the real story may be hidden in the 2 key rewards and 2 important warning signs

BorgWarner (BWA)

Overview: BorgWarner is a long established auto supplier that builds key parts for combustion, hybrid and electric vehicles, including turbochargers, power electronics, eMotors, battery packs and control units that sit at the heart of modern powertrains. Automakers rely on BorgWarner to improve fuel efficiency and emissions performance in traditional engines while also supplying the hardware that powers next generation EVs.

Operations: BorgWarner generates most of its revenue from Turbos & Thermal Technologies at about US$5.75b and Drivetrain & Morse Systems at roughly US$5.72b, with PowerDrive Systems contributing around US$2.37b and Battery Energy Systems about US$542m.

Market Cap: US$14.74b

BorgWarner sits close to the center of the cost efficiency story reshaping automakers after Lucid’s restructuring. It supplies technologies that help both combustion and EV platforms run cleaner and cheaper, while its own portfolio is being tightened through battery consolidation and targeted exits. The company is leaning into electrified powertrains and non auto end markets, is targeting higher margins through restructuring, and has been returning cash through dividends and sizeable buybacks. At the same time, it still carries meaningful exposure to combustion products, funding through external borrowing and a battery segment that analysts flag as pressured. For investors, the interest lies in how those competing forces show up in the 3 key rewards and 2 important warning signs

BorgWarner’s push into electrified and non auto systems is getting more attention, but many investors are still piecing together how the legacy and EV businesses fit. The real tension sits inside the 3 key rewards and 2 important warning signs

Adient (ADNT)

Overview: Adient is a Dublin based manufacturer that designs and builds complete seating systems and components for cars, commercial vehicles and light trucks, supplying everything from frames, foams and mechanisms to headrests and trim covers for major automakers worldwide.

Operations: Adient generates most of its revenue from the Americas at about US$7.07b, followed by Europe, Middle East and Africa at roughly US$4.89b and Asia at around US$3.06b, with small corporate eliminations.

Market Cap: US$1.63b

Adient gives investors exposure to automotive cost efficiency, pairing a large U.S. and Mexico manufacturing base with a cost cutting mindset that is similar to Lucid’s recent restructuring moves. The company has moved from heavy losses to modest profitability, is targeting margin improvement through restructuring in Europe and Asia, and is focusing on higher value EV and comfort oriented seating products such as ProForce Massage Flow and StepJoy to support pricing power. At the same time, earnings are exposed to heavy reliance on external borrowing, interest costs that are not well covered, one off losses and insider selling. How that balance between margin progress and funding risk develops is a central element of the Adient story for investors.

Adient’s margin rebuild and higher value seating push could be masking a bigger funding story, and the full picture only really comes into focus in the 3 key rewards and 3 important warning signs (1 is major!)

The three companies in this article are just a starting point, because the full Automotive Industry, Cost Efficiency Plays screen on Simply Wall St surfaces 17 more stocks with similarly detailed cost efficiency and balance sheet stories inside the Automotive Industry - Cost Efficiency Plays screener. Use the Simply Wall St platform to identify and analyze the catalysts and narratives that matter most to you, so you can focus on the highest conviction cost efficiency plays in the sector.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.