![Ken Zino of AutoInformed.com on Whither the Global Light Vehicle Market?](https://autoinformed.com/wp-content/uploads/2022/10/Global-Light-Vehicle-Sales-Forecast-courtesy-of-and-copyright-LMC-Automotive-300x194.png)
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Conflicting data abounds in global vehicle sales trends during the past few months of stronger selling rates. From a global perspective this is mostly the result of a fast improvement in the China market from a temporary purchase tax cut on cars.
“Across much of the world, supply bottlenecks remain the key reason for holding back better sales results. However, as Europe and North America head into the winter months, economic prospects look increasingly dismal in the face of stubbornly high inflation, and underlying demand for new vehicles is inevitably being eroded,” according to respected consultancy LMC Automotive this morning.
Except for some exceptional months recently, the global Light Vehicle market remains well below the 90+ million-unit level seen before 2020. “The Russian invasion of Ukraine only added to the disruption faced by the supply chain with our latest global LV sales forecast for 2022 now five million units lower than our pre-conflict view (January 2022). The expectation of increased semiconductor supply should see the easing of some of the more extreme pricing over H2 2022 and 2023, as OEMs’ concentration on the highest margin vehicle inevitably eases. However, pre-pandemic global market volumes are not forecast before 2024, with risks remaining skewed to the downside, particularly given the potential for a much harder economic downturn,” said LMC.
Supply chain issues are forecast to ease during 2022. LMC notes that “they are unlikely to be resolved and the ongoing headwind of higher costs for energy, logistics, and materials is expected to continue exerting pressure on profits and end-user pricing. A deteriorating global economic outlook has helped drive prices down for industrial metals such as steel and aluminum, providing some cost relief to the auto industry. However, prices of electric-vehicle-focused commodities, particularly lithium, remain elevated, principally through continued supply deficit concerns.”
LMC Automotive
*LMC Automotive is a leading independent and exclusively automotive focused provider of global forecasting and market intelligence in the areas of vehicle sales, production, powertrains and electrification. The company’s client base from around the globe includes car and truck makers, component manufacturers and suppliers, financial, logistics and government institutions. LMC Automotive is part of the LMC group. LMC is the world’s leading economic and business consultancy for the agribusiness sector. For more information about LMC Automotive, visit www.lmc-auto.com. or contact LMC directly at forecasting@lmc-auto.com.
The Global Light Vehicle Sales Forecast is published in association with Jato Dynamics Ltd. It uses macro-economic forecasts generated by LMC’s partner, the distinguished Oxford Economics, which, combined with an examination of demographics, fiscal and regulatory influences by LMC’s own specialist automotive research team, presents twelve-year forecasts at a global, regional and country level for Light Vehicle demand in 137 countries.
Whither the Global Light Vehicle Market?
Click to Enlarge.
Conflicting data abounds in global vehicle sales trends during the past few months of stronger selling rates. From a global perspective this is mostly the result of a fast improvement in the China market from a temporary purchase tax cut on cars.
“Across much of the world, supply bottlenecks remain the key reason for holding back better sales results. However, as Europe and North America head into the winter months, economic prospects look increasingly dismal in the face of stubbornly high inflation, and underlying demand for new vehicles is inevitably being eroded,” according to respected consultancy LMC Automotive this morning.
Except for some exceptional months recently, the global Light Vehicle market remains well below the 90+ million-unit level seen before 2020. “The Russian invasion of Ukraine only added to the disruption faced by the supply chain with our latest global LV sales forecast for 2022 now five million units lower than our pre-conflict view (January 2022). The expectation of increased semiconductor supply should see the easing of some of the more extreme pricing over H2 2022 and 2023, as OEMs’ concentration on the highest margin vehicle inevitably eases. However, pre-pandemic global market volumes are not forecast before 2024, with risks remaining skewed to the downside, particularly given the potential for a much harder economic downturn,” said LMC.
Supply chain issues are forecast to ease during 2022. LMC notes that “they are unlikely to be resolved and the ongoing headwind of higher costs for energy, logistics, and materials is expected to continue exerting pressure on profits and end-user pricing. A deteriorating global economic outlook has helped drive prices down for industrial metals such as steel and aluminum, providing some cost relief to the auto industry. However, prices of electric-vehicle-focused commodities, particularly lithium, remain elevated, principally through continued supply deficit concerns.”
LMC Automotive
*LMC Automotive is a leading independent and exclusively automotive focused provider of global forecasting and market intelligence in the areas of vehicle sales, production, powertrains and electrification. The company’s client base from around the globe includes car and truck makers, component manufacturers and suppliers, financial, logistics and government institutions. LMC Automotive is part of the LMC group. LMC is the world’s leading economic and business consultancy for the agribusiness sector. For more information about LMC Automotive, visit www.lmc-auto.com. or contact LMC directly at forecasting@lmc-auto.com.
The Global Light Vehicle Sales Forecast is published in association with Jato Dynamics Ltd. It uses macro-economic forecasts generated by LMC’s partner, the distinguished Oxford Economics, which, combined with an examination of demographics, fiscal and regulatory influences by LMC’s own specialist automotive research team, presents twelve-year forecasts at a global, regional and country level for Light Vehicle demand in 137 countries.