GLOBAL AUTO SALES TO SHIFT TOWARD EMERGING MARKETS, ANALYST SAYS

Analyst George Magliano

February 11, 2008—By 2012, the mix of global auto sales will shift from 75 percent in mature markets like the United States and Canada and 25 percent in emerging markets—chiefly China, South America, and Eastern Europe—to a 50-50 split between mature and emerging markets, Global Insight’s North American auto research director George Magliano told NADA’s International Roundtable today.

Magliano said the United States is already in a mild recession, likely to last into next year, with a one-in-three chance of a global recession. The U.S. mortgage crisis created a financial crisis in Europe, and the slowdown is spreading to other markets. Japan has had stagnant economic growth for some time. But China and the rest of the developing world are largely resistant to the problems of mature economies, Magliano said. So light vehicle demand and production will increase 3 percent annually through 2012. By 2012, automakers globally will produce 82 million vehicles, 16 million more than in 2006.

This year, Brazil, Russia, India, and China will see substantial growth in auto sales (though growth in China will slow 5 percent after the Olympics). Cheap cars—subcompacts and microcars—will be big sellers in those countries, said Magliano. Small cars will be particularly popular in India, which has not modernized as China has.

One wild card will be the push for greater fuel economy and measures to cut auto emissions, which will affect all markets, not just the United States and Europe.

The NADA convention is attracting a greater international presence, with 1,868 international visitors from 43 countries. The Latin American Dealers Association again met during the convention. And the first simultaneous Italian translation of four workshops enabled more than 120 Italian dealers to attend. Translations in other languages are planned for next year.

(click the play button)

Audio/Video provided by AutoNetwork.com