While car sales have been hit hard by the Coronavirus disaster, there are small signs of a recovery in the Japanese domestic motorcycle market. According to the Japan Mini Vehicle Association, new motorcycle sales in April 2020 (125 to 250cc) were up 2.0% YOY to 7,772 units.
This is the fourth consecutive month of YOY growth. Some observers believe this is a rebound from the decline following the October 2019 sales tax hike. This growth also is partly due to the growing need by commuters to use motorcycles as an alternative to public transportation to avoid coronavirus.
COVID-19 continues to batter production of off-highway equipment as we continue to move through 2020. The effects of the virus on Agricultural and Construction equipment production in North America were analyzed in a June 17 webinar presented by the Heavy Duty Manufacturers Association (HDMA) and Power Systems Research (PSR). The webinar updated information presented in PSR’s webinar in April.
Jim Downey
The PSR webinar team was Jim Downey, PSR vice president-global data products , and Yosyf Sherementa, PhD, PSR director-product management and customer experience.
PSR projects AG to be down 9.4% and CN to be down 11.3% when comparing global production for this year (2020) to last year (2019).
China and India which have the largest volumes for ag machinery are the lower side for production percentage drops this year. China which is also the largest producer of construction equipment is not expecting a decline this year.
Yosyf Sheremeta
A slight recovery for Construction equipment is expected in 2021, but not until 2022 for Agricultural machinery. Ag sector recovery will ultimately depend on overall economic recovery from the COVID-19 pandemic.
The construction segment will not return to pre-virus production volumes for another few years, at best. We’re looking out to 2024 or possibly 2025 to get back to 1.48 million units.
We don’t see a V-shaped type scenario on the horizon in North America, but rather recovery will look like something between a “U” and an “L.” Somewhat of a swoosh shape or upward sloping L. Economic activity will slowly return to a sense of normalcy as the curve of new COVID-19 cases flattens.
Government support and intervention will be needed, and stimulus will provide an economic backstop. We expect modest growth in 2021. Pent-up demand and continued economic stimulus should also help with rebound.
The symposium of battery change mode for new energy vehicle was held June 15 in Xuzhou, Jiangsu. Data from National Big Data Alliance of New Energy Vehicles suggests that over 3 million new energy vehicles were in the system in 2019 and 900,000 vehicles are running daily. Data also suggest that new energy vehicle GVW range primarily falls under 4.5 tons.
PSR Analysis: Many numbers are in the article, some contradictory. As one of the truck OEMs, XCMG does make some excellent points on the daily use of the battery-powered vehicle, using data collected from end-users, such as working hours, range anxiety and surprisingly, maintenance and downtime.
But I want to point out one potential issue that might travel under the radar: operating cost, more specifically, fuel cost. For large fleet owners like JD.com Inc. or SF Express, fuel cost might be a key factor in choosing a battery-powered vehicle over ICE-powered vehicle for urban delivery.
There are energy companies already working with large industrial businesses to install wind or solar power onsite to address their electricity bill issue. Once completed, giant companies like JD or SF Express will significantly cut down their operating expenses on fuel, in this case, electricity.
There is one game changer out there now. How will ICE-powered light duty trucks compete with battery-powered vehicles, when the latter runs free of charge and free of emission? What will happen to all the components suppliers for light duty trucks, especially urban delivery trucks? PSR
Qin Fen Is Business Development Manager in China for Power Systems Research.
PSR Analysis: A win-win situation for CAMC and Geely. There are still some legal proceedings to finish, but once it’s done, CAMC will save itself from financial trouble and Geely will add an asset to its commercial vehicle lineup. PSR
Qin Fen Is Business Development Manager for Power Systems Research
After the first sale of NG trucks at Fenatran in October 2019, Scania has sold 22 more, including 18 to Pepsico. The forecast of 100 NG Trucks to be sold this year has been reduced because of the pandemic effect.
John Deere announced the start of production of G series of Graders in Brazil in the coming months. It had previously imported these units. With the movement, John Deere will attend the South American Market with 90% of products made in Brazil.
PSR Analysis: The decision of nationalization started in 2018 and makes more sense with recent local currency depreciation. With this movement, Deere will be more competitive in delivery time and it will have some room for margins and pricing variation, what will lead to a moderate growth of share in the market, what is already reflected in our databases forecast.
Power Systems Research published in the June 13 issue of Automotive Business magazine a high level update on perspectives of MHV and Off-Highway segments. See the article at the link below and translated presentation.
PSR Analysis: Although ANFAVEA published a decreased forecast, we believe that the decrease will be lower than the Light Vehicles decrease. Metrics we follow, such as Diesel consumption and the number of Vehicles going through tolls by weight category, show a lower impact in Commercial Vehicles. Other factors: a smaller than expected reduction during the pandemic isolation, agribusiness remaining strong and a lower than expected impact on mining/construction.
Carlos Briganti Is Managing Director, Power Systems Research – SA
This information comes from industry interviews and from two proprietary databases maintained by Power Systems Research: EnginLink™ , which provides information on engines, and OE Link™, a database of equipment manufacturers.
Roughly three months of countrywide lockdown, combined with zero sales and the post-pandemic uncertainty, has resulted in further degrading the health of the already struggling Indian automotive sector.
Aditya Kondejkar
Though it has disrupted the entire value chain of the automobile industry, there is a silver lining to this Covid-19 pandemic: It has stimulated growth in renewable and eco-friendly transportation.
The Indian market has high potential for EVs since most commuters opt for two-wheelers, three-wheelers, and buses. There are numerous latent growth factors in place, and the pandemic might have set them in motion
While the pandemic has disrupted the transportation ecosystem, EV technology has the potential for rapid adoption, driven by an increased awareness towards a greener and cleaner transportation.
The Southeast Asian auto industry continues to suffer from the effects of the new coronavirus. New car sales in April were down 80% year-on-year due to restrictions on activity in each country. New car sales in the six major countries were down 82% in April from a year earlier to 51,063 units.
Akihito Komuro
The biggest declines were in Malaysia and the Philippines, where sales were down 99.7% and 99.5%. Both countries began restricting activity in March, with production and sales of cars almost completely halted in April. Indonesia, the largest market, was down 91%. Thailand sales slumped 65%, although car dealerships operated under a declared state of emergency.
