Results of just-auto's annual auto industry survey

Results of just-auto's

annual auto industry survey

➢Business confidence

➢Car market forecasts for 2013

➢Car companies – winners and losers

➢Views on consumer/market

preferences

How do you feel about business prospects for your company over the next 12 months?

What do you see as the biggest risks ahead for the industry in 2013? (Please rank 1-4; 1= biggest risk)

What area of automotive innovation do you think will be of greatest importance to the consumer in 2013? (Tick those that apply)

What do you think will happen to the following car markets in 2013? (Tick for markets you know about; otherwise leave blank)

➢ Mainstream carmakers face greater pressures from above and

below; more cost pressures on whole supply chain.

➢ Major OEM to go under? No, 72%.

➢ Greater market acceptance for hybrids? Yes, 71%

➢ Will pure EVs continue to sell below target in 2013? Yes, 87%

➢ Auto industry execs to have good year in 2013:

o Alan Mulally

o Martin Winterkorn

o Akio Toyoda

More of the same: another year of uneven growth around the world

Europe – with its economic problems - is the main source of gloom, risk

and structural problems

Cost pressures and maintaining profitability are the big industry-wide

challenges

There are good growth opportunities in NA and Asia

Successful companies make products people want to buy and have a

good global sales and production footprint (and less Europe exposure)

44% of respondents 'quite optimistic' on the outlook for their company

European Automotive Outlook Jonathon Poskitt 27 February 2013

Outline

• Economic Environment

• Car Market Outlook

• Implications for Production

© LMC Automotive 2

Economic indicators remain concerning…

Source: Oxford Economics

© LMC Automotive 3

European Consumer Confidence

Source: European Commission

© LMC Automotive 4

UK Recoveries from Recession

Real GDP, Relative to Pre-Recession Level

Source: NIESR 0 6 12 18 24 30 36 42 48 54 60

8%

6%

4%

2%

0%

-2%

-4%

-6%

-8%

-10%

Months Elapsed Since Onset of Recession

Great Depression 1930-34

1973-1976 1979-1983

1990-1993

2008 - ????

1920-1924

10%

-12%

© LMC Automotive 5

Eurozone GDP Outlook…

© LMC Automotive 6

German Car Market S

ales

Vol

ume

(mn)

Avg ‘00-’07 3.30 mn -3% +9%

• After a healthy first half to 2012, ongoing bad news on Eurozone hit consumer confidence led to rapid deterioration in H2

• Nov ’12 to Jan ’13 selling rate average of 2.9 mn units/year

-3%

© LMC Automotive 7

Spanish Car Market S

ales

Vol

ume

(mn)

Avg ‘00-’07 1.54 mn

-18% -13%

• Lift given by PIVE scrappage incentive scheme though thus far failed to translate into significant boost (January selling rate at 690,000 units/year)

• When incentive ends, selling rate is set to dip further

-5%

© LMC Automotive 8

Italian Car Market S

ales

Vol

ume

(mn)

Avg ‘00-’07 2.37 mn

-11%

-5%

• Selling rate at 1.4 mn units/year in final quarter of 2012, where full year ended

• Ongoing fiscal austerity measures and climbing unemployment will continue to act as a drag this year. Latest SAAR just 1.1 mn units/year

-20%

© LMC Automotive 9

French Car Market S

ales

Vol

ume

(mn)

Avg ‘00-’07 2.09 mn

-2%

-9%

• Scrappage incentives extensively used throughout recession, with final incentive-related boost in Q1 2011

• Market continued to hold up well reasonably well until 2012. Latter few months’ selling rate has dropped below 1.8 mn units/year

-14%

© LMC Automotive 10

UK market improvement driven by private retail side…

© LMC Automotive 11

UK Car Market S

ales

Vol

ume

(mn)

Avg ‘00-’07 2.45 mn

-4% 1%

• Against the general trend in Western Europe, the UK has made solid progress, driven by the private retail side of the market

• Economic conditions remain testing for this year; we remain cautious of strong market growth in 2013

5%

© LMC Automotive 12

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Millions

SAAR Moving Average Forecast Annual

Car Sales in Western Europe

No recovery this decade

Forecast

5 year recovery

© LMC Automotive 13

Summary of Light Vehicle Sales Forecasts S

ales

Vol

ume

(mn)

© LMC Automotive 14

…yet European stocks nudging upwards (volume change, ‘000s)

2009 2010 2012 2011

© LMC Automotive 15

European LV Production : Recession ’000s

+15.0% +7.0% -5.6% -3.9%

© LMC Automotive 16

Capacity Utilization in Europe

60%

63%

2013

18.6mn

66%

2012

19.4mn

71%

2011

20.5mn

© LMC Automotive 17

Concluding Remarks

• Another year of market volume falls in Western Europe

• Of Big Five markets, only UK set to make progress

• Overall, European Light Vehicle market to fall 3%

• European production cut back and capacity utilization drops to 63%

© LMC Automotive 18

Accurate Real-Time Automotive Forecasting

and Market Intelligence

Oxford ● Detroit ● Frankfurt ● Bangkok ● Shanghai

www.lmc-auto.com

jposkitt@lmc-auto.com

© LMC Automotive 19