After the marginal growth rates in production and exports registered in 2016, the industry seems to be picking up the slack for what seems to be an excellent year for automotive production, although not so much for sales.
Numbers from November show that OEMs have already surpassed the production mark set in 2016 of 3.46 million light vehicles. Between January and November 2017, almost 3.53 million units were manufactured, representing a 9.4 percent increment compared to the same period in 2016.
Although Ford, Honda, Mazda and Nissan decreased their output, other companies grew their operations led by Kia with a 120.1 percent increase delivering a total of 207,100 units. Based on the growth rates from previous months and the market’s behavior from previous years, the industry will most likely end the year with a total production of 3.7-3.8 million units, or 6.9-9.8 percent growth.
Exports show an equally positive trend. Between January and November 2017, 2.85 million light vehicles were exported; 75.4 percent of these went to the US and 8.9 percent to Canada. This shows an 11.7 percent increase compared to the 2.55 million units exported in 2016. Kia is also the big winner in this segment with 149,919 units exported and a 90.5 percent increment compared to 2016. By the end of the year, exports will most likely hit the 3-3.1 million mark, representing growth of 8.7-12.3 percent.
The dark cloud hovering over the industry is the expected growth in domestic sales. Since 2010, the market had consistently grown from a standpoint of 754,918 units sold in 2009 to its highest point in 2016 with sales of 1.6 million vehicles. However, results started decelarating in January 2017 and starkly decreased in June compared to levels in the same month of 2016.
So far, between January and November, the industry has reached sales of 1.37 million units. To reach similar results to those of 2016, the industry would have to sell 232,072 units in December, which seems rather ambitious considering that the best-selling month for the domestic market was December 2016 with 192,567 units. Furthermore, after repeated negative growth results from June to November, the most likely scenario for the market is to end with sales of 1.5-1.55 million vehicles, or negative growth of 5.2-6.3 percent.
The data used in this article was sourced from AMIA.