Traditional automotive markets in Europe and the United States (US) are showing the most promising signs of growth and are ahead of struggling emerging economies, according to Euler Hermes.
The global trade credit insurance company, in its ‘Auto Market – a live wire’ report, warned that the economic slowdown across emerging markets had caused the following:
- In China, sales are set to fall sharply to 3% growth in 2015 and 2016, compared to 10% expansion last year
- Registrations in Brazil are expected to fall by 14% in 2015 to 2.3 million units, well below the 3 million units produced in 2013
- Russia is set to see its market shrink by over a third to 1.6 million vehicles
- Indian sales could grow by 6%, but will only take the country to 2011 levels of production.
Meanwhile, the United States has enjoyed six consecutive years of growth and has climbed back to its pre-crisis peak, with Euler Hermes predicting that the market will grow a further 4% in 2015 to 17.5 million vehicles.
In Europe, the automotive industry is expected to continue its recovery with a projected expansion rate of 5%, despite intense competition and low margins. The United Kingdom is leading the way, having bettered its all-time record with 5-6% hike in registrations so far in 2015.
The report also highlighted the shift of power in vehicle production, with China having increased its output by 167% between 2007 and 2014; India and Mexico also achieved significant gains with 70% and 61% rises respectively.
Global automotive production is set to slow to just 2% in 2015 before recovering its 3% or 4% annual growth potential in future..
