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Strong Growth in South American and Eastern European Automotive Manufacturing Industries
Weak economic conditions and on-going financial difficulties in North America and Western Europe resulted in low market expansion in these regions, which was negated at a global level by strong growth in the South American and Eastern European automotive manufacturing industries.
The global automotive manufacturing industry grew by 6.3% in 2011 to reach a value of $1,435.5 billion, representing a compound annual growth rate (CAGR) of 2.5% for the period 2007-2011. Volumes also increased in 2011, growing by 4.3% to reach a volume of 136,589.6 thousand cars, representing a CAGR of 3.4% for the period 2007-2011.
The Asia-Pacific region continues to dominate the industry and represents 47.4% of the industry’s overall value. The major manufacturing centres of China and India have contributed heavily towards this as well as the major car and truck brands of Japan and South Korea like Toyota, Nissan and Hyundai whose global presence and demand has sustained these countries domestic manufacturing industries. The Asian-Pacific market is likely to be main driver of growth in future years as certain domestic economies have encouraged overseas investment as a result of lower manufacturing costs.
Substantial growth in the past two years has been seen in a number of emerging South and Central American countries such as Argentina and Mexico alongside strong double digit growth seen in Russia and the Ukraine.
Automotive manufacturers have increasingly had to contend with continuously rising oil prices, thus requiring investment in research and development to develop more fuel efficient engines in order to reduce fuel costs for customers. Furthermore ever more stringent emissions legislation has also led to automotive manufacturers being forced to develop new technologies, to abide by these new standards to ensure their vehicles can be sold in the relevant countries.
Another issue that threatens automotive manufacturers is alternative modes of transport, such as railway or water-borne transport. In a number of developing countries this is a genuine threat, for example China is investing $62 billion in railway infrastructure in 2012 (after spending $108.5 billion in 2010 and $72.7 billion in 2011). This level of investment and construction is expected to pose a long term threat to road transportation, and as a result could impact on automotive manufacturers.
For top-line data and analysis covering the automotive manufacturing markets in different countries and regions, click here…