Technological innovation, strategic partnerships and mergers and acquisition activity will set the stage for growth in 2014
DETROIT, 29 October 2013 – Global light vehicle assembly is expected to reach 81.8 million units in 2013, representing a 3.3 percent year-over-year gain, according to Autofacts, PwC’s automotive analyst group. While there has been speculation around the long awaited recovery of the European Union (EU), 2013 is poised to mark a turning point, setting the stage for recovery in 2014. This will bring the region in sync with the recent recoveries in North America and Eastern Europe and the continued growth in developing Asia-Pacific and South America.
“Consumer demands and regulatory requirements are motivating the global automotive industry to push ahead with technological breakthroughs on a larger scale,” said Rick Hanna, PwC’s global automotive leader. “Innovation ranging from new investments in lightweight materials, advanced drivetrains and infotainment systems to fresh approaches in engaging customers, will continue to shape the industry. The automakers that effectively leverage high-tech advancements in vehicles, mobile devices and data analytics will likely gain a competitive advantage in this dynamic market.”
Global automotive industry regional highlights:
In contrast to the stagnant sales market, the assembly volumes in Brazil have seen steady growth with full-year 2013 assembly expected to reach approximately 3.4 million units. Several global OEMs have announced capacity investments in the next few years, pushing assembly to just below 4 million units by 2015. Meanwhile, Argentinean production has been impacted by the sluggish Brazilian sales market, seeing an overall decline in demand from their largest trading partner. Though assembly has not kept pace with sales, full-year growth of approximately 7.7 percent for 2013 is still expected. As with much of the region, Argentina’s expansion hinges on multiple monetary and economic variables, most of which are subject to significant state intervention and thus, remains volatile.
Full-year sales for Turkey in 2013 are forecasted to reach 840 thousand units, an 8.2 percent growth over 2012. Turkey is already seeing a boost in locally produced models, which has supported the full-year 2013 production expected to total approximately one million units and reach nearly 1.2 million units by 2014. Overall, the Eastern European region is rife with opportunity, and as long as progress continues, these emerging countries could become future assembly bases as OEMs continue toward the mantra of “build it where you sell it.”
Year-to-date vehicle sales in Australia grew to 737 thousand units, putting the market on pace for another year of sales surpassing the one million unit mark. With recent withdrawals from the Australian assembly base, volumes are expected to remain relatively flat at around 250 thousand units for the remainder of the decade.
Consumers in South Korea have shown a marked shift toward imports, which have jumped 29 percent year-over-year as domestic brands have been holding flat in terms of sales. South Korean assembly volumes remain flat, growing at a scant 0.14 percent year-over-year to reach just under 4.4 million units.
The total assembly volume in the developed Asia-Pacific Region is forecasted to hover around 4.5 million for the remainder of the forecast window.
For more details about PwC's quarterly forecast update, download the October issue of PwC’s Analyst Note at: www.autofacts.com or download the Autofacts iPad application.
About PwC's Automotive Practice
PwC's global automotive practice leverages its extensive experience in the industry to help companies solve complex business challenges with efficiency and quality. One of PwC's global automotive practice's key competitive advantages is Autofacts®, a team of automotive industry specialists dedicated to ongoing analysis of sector trends. Autofacts provides our team of more than 4,800 automotive professionals and our clients with data and analysis to assess implications make recommendations, and support decisions to compete in the global marketplace.
Autofacts is a key strategic asset of PwC’s global automotive practice. Fully integrated with PwC’s more than 4,800 global automotive professionals, Autofacts provides ongoing auto industry analysis our clients use to shape business strategy, assess implications and support a variety of operational decisions. The Autofacts team also draws from the strengths of PwC’s marketing, sales and financial services groups to support other key areas of automotive companies’ functions. Since 1985, our market-tested approach, diverse service offerings and dedication to client service have made Autofacts a trusted advisor throughout the industry. For more information, visit www.autofacts.com.
About PwC US
PwC US helps organizations and individuals create the value they're looking for. We're a member of the PwC network of firms in 157 countries with more than 184,000 people. We're committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com/US. Gain customized access to our insights by downloading our thought leadership app: PwC's 365™ Advancing business thinking every day
© 2013 PricewaterhouseCoopers LLP, a Delaware limited liability partnership. All rights reserved. PwC US refers to the US member firm, and PwC may refer to either the PwC network of firms or the US member firm. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.