2020-04-25
Due to the spread of COVID-19, Japanese automobile OEMs have stopped production in Indonesia. Isuzu stopped operating its plants April 1, and Honda and Suzuki stopped April 13.
Many automakers who suspended work March 30 in Russian, as ordered by the government to the reduce spread of the COVID-19 resumed work April 6. The firms including KAMAZ, AutoVAZ, GAZ Group, Mazda Sollers.
However, 98% of office personnel are working remotely. Started working YAMZ, Yaroslavl plant of diesel apparatus and some production lines of Likino bus plant. Procurement production of GAZ plant in Nizhny Novgorod is also working. Schedule of main production lines will be determined within a week depending on situation on suppliers’ plants. Read The Article
2020-03-23
This article first appeared in the March 2020 issue of PowerTALK™ News
China is one of the leading suppliers of auto components to India, and this supply chain was significantly interrupted in Q1 2020 by the caronavirus. In 2018-19, components worth an estimated US$4.5 billion (out of a total of approximately $17 billion) were exported from China to India. Most of this trade is in electronic components, EGR modules, fuel injection pumps, turbochargers, meter sets, LEDs, magnets, airbag components, and steering system components.
Since the discovery of the Coronavirus in December 2019, this supply chain has been affected. The covid-19 pandemic has started taking a toll on components supply and automotive production in India. The situation is further amplified, as China has terminated all sea routes to other parts of the world.
2020-03-22
This report appeared in the March issue of PowerTALK ™ News
Lack of components coming from China may be a problem because of work interruptions caused by the coronavirus. According to the Brazilian Machinery Builders´ Association (ABIMAQ), the risk of supply stoppages is high. The Chinese content of an Agricultural Machine produced in Brazil is estimated to be 10% to 15%, with higher concentration on electronics components.
Source: M&T / Globo Rural Read The Article
PSR Analysis: This is an opportunity for local and international players to start
supplying these companies as an alternative source. The time window is short for
development of alternative sources, but global companies may start risk mitigation
plans. Understanding the opportunities, volumes and component content will be
key at this moment.
The combination of market decline by 31% and the increase of vehicle imports
are the main reasons for the drastic reduction in production. From 2010 to
2015, the local production has been above the imports, with significant exports
to neighbor countries as Colombia and Peru. From 2016 – 2018, imports grew
from 31,000 to 103,000 units, while the production grew from 29,000 to 42,000
between 2016 and 2017, after a significant market growth, but reduced from
42,000 to 18,000 in 2019 with the competition from imports.
Source: PSR / AEADE Source: M&T Read The Article
PSR Analysis: Currency policy changes and changes in automotive industry
regulations are the main reasons for the shift in the automotive industry of
Ecuador. These changes affect not only Ecuador, but also the ability to reach
neighbor countries with its products, opening space for other players, like
Brazilian and Chinese. PSR
Fabio Ferraresi is PSR Director, Business Development, South America
2020-02-25
This article initially appeared in the February 2020 issue of PowerTALK News.
SUMMARY. The North American economy remained stable in 2019 and pure economic conditions as well as fundamentals in the region were favorable. Most industries performed very well, and the short-term outlook remains stable to flat for most market segments. However, we see many new developments that could suggest a shift in the trend.
Consumer confidence declined slightly in December, following a moderate increase in November. The Conference Board’s Consumer Confidence Index stood at 126.5 in December, 1.4 points higher than in September 2019.
Per Lynn Franco, Senior Director of Economic Indicators at The Conference Board: “While consumers’ assessment of current conditions improved, their expectations declined, driven primarily by a softening in their short-term outlook regarding jobs and financial prospects. While the economy hasn’t shown signs of further weakening, there is little to suggest that growth, and in particular consumer spending, will gain momentum in early 2020.”
This article initially appeared in the February 2020 issue of PowerTALK News.
THAILAND–Vehicles produced in Thailand are exported to the world, including Asia, Oceania, the Middle East and Europe. However, the automobile industry is in trouble because of the double punch of the global economy slowing down due to the US-China trade friction and the spread of the new coronavirus.
Exports, which account for half of Thailand’s automobile production, where Japanese and other automakers such as Toyota and Honda have production bases, have fallen, and vehicle production turned negative for the first time in five years in 2019. In addition, the spread of the new coronavirus is catching up. It is expected that the impact on Thailand’s automobile industry will be even greater if the shutdown of factories in China and production cutoffs are prolonged and parts procurement is delayed.
Source: NHK
PSR Analysis: From about September 2019, it has been reported that many Southeast Asian automobile industries, including Thailand, have begun to slow down, but this has been attributed to a slowdown in trade due to US-China trade friction.
Today, of course, there is the same problem, but the rapid spread of COVID-19 is a new problem. Many automotive industries around the world are supported by the supply of parts from China, and a slowdown in supply could severely impact car production. Especially in Southeast Asia such as Thailand and Indonesia. PSR
Akihiro Komuro is a Research Analyst covering the Far East and Southeast Asia for Power Systems Research.
This article initially appeared in the February 2020 issue of PowerTALK News.
Opel is back in Russia, and the company appears to be betting the Russian market can provide a significant opportunity for business diversification.
In 2019, company sales declined as the business was reorganized, and Opel cut its model portfolio.
According to reports, 96% of Opel sales are concentrated in Europe. This fact has determined a focus point for sales increase. In 2022, Opel expects to be in 20 new export markets. After 20 years of financial losses, the very first year within the Peugeot SA structure was quite profitable for Opel (plus 859 million Euro for 2018).
Meanwhile, the Russian PSA plant in Kaluga has begun final preparations for production of Zafira Life and Vivaro minivans.
PSR Analysis: It appears that Opel has decided to start with minivans in the Russian market, and it is targeting the LCV niche where the chances for success are better than in passenger cars. While individual consumer demand is declining for LCVs, the companies making the vehicles locally can receive State and municipal orders for vehicles.
Last year, the State placed big orders for ambulances and school buses, sharing the orders between the GAZ Group and other local OEMs. At the same time, new models of passenger cars produced abroad, like Opel Crossland X, did not post good sales in the Russian market. PSR
Maxim Sakov is a Market Consultant in Russia for Power Systems Research
This article initially appeared in the February 2020 issue of PowerTALK News.
Source: Business Today Read The Article
PSR Analysis: The Indian Automotive Industry was largely left disappointed with the budget after no direct steps were taken to arrest the decline in automotive sales. Although keeping long term benefits in mind, the budget did introduce measures to boost the rural economy, which in turn will directly benefit the commercial vehicle industry which is an important driver for the economy.
This article initially appeared in the February 2020 issue of PowerTALK News.
Despite the poor performance of auto sales in Latin America countries such as Mexico and Argentina, Colombia keep growing sales of cars as Brazil, with 2.7% growth with 263,700 units in 2019. Colombia also leads in EV/HEV sales gains. The forecast for 2020 is that sales will continue growing at the same rate.
Source: Andemos Read The Article
PSR Analysis: Pent up demand for vehicles coupled with a strong economy is expected to keep the car market in Colombia growing. The currency devaluation in 2019 affected the market, since a significant portion of vehicles are imported or assembled in Colombia under the CKD model. It is an important time for exports from Brazil, that went through currency devaluation as well and for local producers such as GM Colmotores and Hino. PSR
2019-10-31
The Tokyo Motor Show was a major event that attracted 2 million people from the 1980s to the 1990s, but in recent years the number of visitors has decreased and the last exhibition in 2017 drew only 770,000 attendees.
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