Growth in global auto sales is expected to slow down in 2018 while remaining at record levels according to a recent report from IHS Market.
The business information company forecasts moderate growth of 95.9 million light vehicles to sell in the coming year up 1.5% on 2017. At 14:19 GMT, Tokyo-listed Toyota was down -2.86%, General Motors, was up +0.27% in pre-market trading and Volkswagen slipped -0.67%.
Global auto sales in 2017 achieved another banner record year despite weaker than expected auto sales in December with sales volumes decreasing 1.7% to 8.65 million units over the same period last year.
However, total sales in 2017 are expected to post 94.5 million up 2.4% compared with 2016 and looks to be on track for a record gain for the eighth year running.
Regionally, performance will be affected by a confluence of factors dependent on the economic and political climate but milder growth is forecast in the US, Western Europe and China while other markets like South Asia, Russia and Brazil should see accelerated growth.
In the US, strong economic growth is spurring demand which remains healthy and good credit conditions. However, full-year sales volume in 2018 is expected to fall 1.7% to 16.9 million vehicles sold. What may impact sales are an incoming flow of used vehicles and a continued slowdown in passenger car sales as more consumers opt for utility vehicles.
Slower growth is also expected in Western Europe which is continuing to recover and IHS Markit forecasts 16.3 million units for 2018, up about 0.7%.
BRIC sees growth
Factoring in tax payback effects, Chinese demand will post 28.1 million units, up 0.2% from 2017, according to the forecast. The South Asian outlook has improved dramatically says IHS Markit and estimates this market will be up 7.3% from 2017, with India after tax reforms up 11%. ASEAN car markets should see an improved outlook of 7% over last year.
While Russia and Brazil both turned the corner last year, whether or not it is sustainable in 2018 is to be seen. Russia is expected to surge by 15.9%, helped by a stronger rouble and some recovery in oil prices, although sanctions may weigh.
Brazil's political troubles are also a significant factor in auto sales growth, but 12.5% growth is forecast for 2018, driven by pent-up demand and improving auto-financing conditions.
Rising oil prices and economic growth are also expected to fuel growth in Middle Eastern countries with the region forecast to grow at 5%. Although political developments in Iran will need to be monitored closely says IHS Markit.