Global Car Sales To Decline By 3.1 Million Units In 2019: Study11/28/2019
We have been closely tracking the ups and downs of the Indian auto industry and we’ve told you how the sales in the country have been affected. While sales did recover in the festive season, the coming month is likely to see a drop in sales again but hopefully things will look up by the next financial year. However, the drop in sales is a global phenomenon and one that we’ve also extensively spoken about. A study done by the Economics team of Fitch ratings has said that the global car sales is likely to decline by 3.1 million units in 2019. This according to the study is a larger decline than in 2008.
Global passenger car sales fell to 80.6 million in 2018 from 81.8 million in 2017, the first annual decline since 2009 adjusted to also include light-trucks in the US (SUV’s and pick-up trucks). The turnaround after the rapid growth seen over 2011 to 2017 has been a significant factor behind the slowdown in world manufacturing and global GDP growth.
Brian Coulton, Fitch Chief Economist, said, “The downturn in the global car market since the middle of 2018 has been a key force behind the slump in global manufacturing and the car sales picture is turning out a lot worse than we expected back in May,”
Global passenger car sales fell to 80.6 million in 2018 from 81.8 million in 2017, the first annual decline since 2009
Sales of vehicles worldwide are expected to decline by about 4 per cent to around 77.5 million. This decline would be larger in absolute terms than 2008 when car sales fell by 3 million units which marked a 5 per cent decline year on year.
According to the research by Fitch Ratings, the main source of weaker-than-expected sales this year has been China. Year-to-date sales are down by 11 per cent compared to the first 10 months of 2018 and there are few signs of a notable recovery. Both the US and western Europe are expected to see declines of nearly 2 per cent this year. Combined sales in Brazil, Russia and India are down by 5.5 per cent year- to-date, reflecting sharp falls in India.
The recovery, if any, would be marginal and the study does not really say anything about when we’ll see the automotive industry back to its old days. Given the stricter emission norms set by many countries and the focus on safety by many carmakers across worldwide, the hike in prices of cars was a natural cause. However, the incoming of technology in the auto sector is likely to be a game changer and we wait to see how that pans out in the future.
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