Automotive Forecast

On the eve of the 2013 New York Auto Show, the media has noted the irony that one of the largest auto shows in the country is taking place in a location where many residents do not even own a car. What is less frequently, if ever, mentioned in the press is the fact that the mix of new cars purchased by New Yorkers who DO own a vehicle is far different from the mix in the rest of the United States.

One of the most vivid differences between new vehicle registrations in New York and the rest of the...

Venezuela was all over the news last week because of the death of its president, Hugo Chávez. President Chávez passed away after a battle against cancer, which included several surgeries in Cuba. What the international media did not pay attention is to a law approved in January that affects the automotive industry.

How would you react if a law determined that all new vehicles from now on should have a sticker price from the first half of 2009? Moreover, could you, the dealer network, afford to...

Three new cars are striving to gain ground in the huge non-luxury small car segment. The 2013 Dodge Dart was launched last June, the redesigned 2013 Nissan Sentra last November, and the 2014 Kia Forte sedan arrives later this month. This segment accounted for 16% of all new vehicle registrations in 2012, second only to the midsize cars 17.6% among the 32 segments tracked by Polk. The non-luxury small car segment has been dominated for years by such well-known models as the Corolla, Civic and...

As Toyota announced it has regained the global sales crown, it makes me think of how the Japanese OEM has wasted its chances in the world's fourth largest market. Not everyone is aware that Toyota opened its first factory outside of Japan within Brazil in 1959, a plant that is currently used to produce parts. For decades, the Brazilian market was closed to imports and Toyota only produced a version of its Land Cruiser. It was a great product for rural areas, but Toyota was far behind its...

South America is a very diverse continent. Brazil, its main country, forbids diesel passenger cars and speaks Portuguese, but is surrounded by Spanish speaking countries. French Guiana still belongs to France, something not very common nowadays. Consumer behavior is also different: Toyota, for example, is the market leader in Peru and has a higher share in the countries closer to the Pacific Ocean, while customer loyalty in Brazil and Argentina goes toward brands from Europe and the United...

Many of you may be returning to work this week after an extended vacation around the holiday season. Welcome back! I'll keep this blog short and informative.

It's 2013 and the world didn't end last month as the Mayans (supposedly) predicted. Given this, we can officially remove Mayan prognosticators from the category of a legitimate forecasting entity. However, Polk has a few predictions. They go something like this: 

1. New auto sales for 2013 will jump 6.6 percent over last year. Our U.S....

Late in June, Argentina canceled the free-trade agreement it has had with Mexico since 2002 (as noted in my prior blog). Argentina wanted to negotiate the agreement, as Brazil successfully did with Mexico, assigning quotas to imports but Mexico did not concede. Argentina has been consistently the fifth main market for Mexican exports since 2009, although volumes jumped 177% between 2009 and 2011. Brazil went from the fourth spot in 2009 up to second place this year, even with limits to imports...

Automotive marketers continue to covet the young buyer and this holds true in the luxury market as much as in the mass market. The luxury marque that captures the young buyer then merely has to retain him/her and move him/her up the ladder, while the luxury brand that fails to appeal to the young demographic is faced with the more expensive task of conquesting from a competitor. This is not to imply that customer retention is "easy," but it is generally acknowledged to be less expensive to...

Welcome to a series of blog posts about the global automotive market based on a paper that I recently worked on with a set of colleagues that discusses important strategic questions for automotive business planners. For those of you interested in the BRIC countries (Brazil, Russia, India and China), this blog focuses on the question, "Will BRIC countries continue to drive organic growth in the automotive industry?"

Answer: Yes!

Why? Of the 38 percent jump Polk expects to see for global light...

It was a national holiday in Brazil on October 12 and I went with my family to where my father was born, a small town where approximately 10,000 people live today. During the long weekend, my impression was that Chevrolet was the best seller in Brazil, but actually it falls behind Fiat and Volkswagen. However, I saw more of the Chevrolet Montana (a pick-up truck based on a passenger car, something that Brazil created decades ago) and the S-10 (the local name of the Colorado) than the Fiat Strada...

I arrived in my hometown of Sao Paulo, Brazil yesterday and thought for sure that I would see a couple of Volkswagen Gols with their new facelift, which was announced in July. The Gol has been the best-selling vehicle in Brazil for 30 years and in the past, I have always seen a new generation or facelift on the streets as soon as they were announced. However, to my surprise, yesterday was different: I didn't see a new Gol.

At the airport parking lot, there were two EcoSports – the crossover Ford...

It's difficult to overstate the importance of the Accord to the Honda franchise. The Accord is to Honda as the F-Series is to Ford, the Caravan is to Dodge, and the 3-Series is to BMW. The Accord is the heart and soul of Honda. Launched in 1976, the Accord has been at or near the top of the midsize sedan segment ever since. There are 11 million on the road. Car & Driver magazine has named the Accord one of the Ten Best Cars some 26 times, more than any other vehicle. Mr. Takuji Yamada, Executive...

At this point in automotive history, nobody denies the importance of Hyundai. According to Polk data, the Korean OEM produced almost 3 million light vehicles worldwide in 2003 and we forecast that its output will reach 8.3 million in 2016. That's a growth of 183%, while on the other hand, GM's production is rather stable during the same period.

Part of this growth will come from a brand new factory in Brazil. With an investment of $600 million, Hyundai will start producing a hatchback on...

It is a presidential election year, which is creating a flood of advertisements along with politicians pounding on podiums to convince voters they are the best candidate for the job. Politicians present their plans to turn the United States economy around and create jobs. Both parties discuss plans to invest in small companies and sexy high tech companies such as Facebook, and mobile devices including phones and tablets.

Too often, they fail to discuss plans to attract and retain manufacturing...

My global colleagues just prepared a brief analysis of the car market in Japan. While 2012 is certainly better than last year's struggle, the outlook for 2013 and beyond will be an uphill climb.

For you crystal-ball gazers, here are four automotive forecast views that Polk has about the Japanese auto market:

1. In 2011, Japan sold 3.5 million new cars and for comparison's sake, during the first half of 2012, new car sales rose by 57 percent compared to the first half of 2011.
    
2. For the full-year 2012,...

As the July sales numbers were released, Ford and GM made the headlines for their drop, while Chrysler still enjoys its momentum. But Ford’s challenges are not only in the U.S. – and I am not talking about Europe. In Brazil, where the market enjoyed a 22% growth in July, Ford sold 12% less light vehicles compared to June. Its monthly market share slumped to 8.44% from 9.90% in the previous month.

Ford, the first OEM to be established in Brazil (1919), has always faced challenges in Latin...

In an eastern province of Paraguay, more than 300 police officers tried to evict 150 landless farmers from an estate owned by a political opponent of Fernando Lugo, the Paraguayan president. Six police officers and 11 farmers died. One week later, the Senate voted to impeach Mr. Lugo for his “poor performance” during the forced eviction. He was immediately replaced by the Vice President, Federico Franco, who will be in charge of the 6.3 million person country until next August, when Mr. Lugo's...

The Polk forecasting team is in a position to report good news as the North American assembly and sales volumes continue to improve year over year. This is the direct result of modest economic improvement and the satisfaction of pent-up demand. Polk anticipates North American assembly volumes will increase by 10% (14.4 M) in 2012, following a 10% increase in 2011 (13.1 M) and a 39% increase in 2010 (12M), following a dreadful fall to 8.6 million units in 2009.

However, there is at least one fly...

Presenting challenges and opportunities to automotive suppliers

There has been a great deal of media coverage regarding the growth in new vehicle demand in the BRIC countries, with much of that growth taking place in China. This is related to a growing Chinese middle class with growing net worth, which is creating a market of many first-time new vehicle buyers.

However, there has been less attention provided to the rapidly growing light vehicle assembly volumes in China as automakers are expanding...

Non-luxury fullsize cars, once the mainstay of the U.S. car business, are losing their luster in the eyes of the U.S. consumer. This category’s share of the U.S. market has dropped by more than half over the last five years, and through the first three months of this year, it accounts for just 2.3% of all new vehicles sold. The number of fullsize models in dealer showrooms has declined dramatically as well, falling from 15 just five years ago to only seven now. The only large non-luxury cars now...