Once again global automakers are facing an economic change that challenges old assumptions – in this case Asian growth offsets declines in other major markets. Consultancy LMC Automotive notes that during 2016 Light Vehicle sales in Asia-Pacific (along with Central America) climbed at the fastest rate in the world, growing by 9% year-on-year (YoY), versus YoY increases of 7% in Europe and just 2% in North America.”
The growth was mostly Chinese, but India also helped. The Chinese was expanding by 13% YoY, following single-digit growth in the previous two years. Likewise, Light Vehicle demand in India accelerated by 7% YoY.
No doubt this hurts Asia-based automakers , but the VW Group, Daimler Group, BMW Group and General Motors – are clearly endangered, because the region accounts for a significant share of their global volume.
“The sharp contraction in China is not news, says LMC. “However, the weakness in the Indian market since the second half of 2018 is troubling. Worse still, both China and India have performed below our expectations in 2019. This has forced us to lower our projections for both markets since the start of the year. In short, growth in Asia-Pacific this year is no longer guaranteed, while sales in the next five years are estimated to expand by a mere 3-4% YoY.”
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