Honda will sell some of its new vehicles without a function that detects vehicles in the blind spot and warns the driver, saying the dedicated semiconductors required for this function have been in short supply.

To solve the situation where it takes about a year from order receipt to delivery, Honda will sell the new models with the function reduced so that they can be delivered in about six months.

Sales of the new SUV model “ZR-V” began with a specification that eliminates “Blind Spot Information (BSI),” which alerts the driver by detecting vehicles diagonally behind the vehicle and displaying them in the door mirror. Since the procurement of the necessary in-vehicle semiconductors was not completed in time and the delivery period was expected to be prolonged, the company decided to sell the car without this BSI function. Although it varies by store and model, the time from order to delivery can be reduced by half, from about one year to about six months.

At the same time, Toyota Motor Corporation has reduced the number of “smart keys,” the remote-controlled keys given at the time of delivery, from the usual two to one, starting with production in November 2022. The second key will be given as soon as it is ready.

Nissan Motor Co. is averaging 2 to 3 months for delivery of its small car “NOTE” and mid-sized minivan “SERENA,” which is half of what it was six months ago. However, before COVID, it was one to two months.

Source: The Nikkei

PSR Analysis: I visited CONEXPO2023, the world’s largest construction equipment exhibition, where many remote-control systems, including Trimble, were on display. The system consists of multiple large monitors, a cockpit, and joysticks to operate construction equipment from a remote location via the Internet. It is my impression that many of these systems were developed by telecommunications giants and aimed at construction equipment manufacturers.

Hitachi Construction Machinery is now offering this system as its own service to its customers. In the midst of a serious labor shortage, such labor-saving systems are in high demand. Unmanned operation is the ultimate goal of the construction machinery industry, but the first step would be to operate multiple job sites from a single location using such a remote-control system. PSR

Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research

The Brazilian Federal Government this month has announced a package of incentives for the automotive sector during a press conference held in Brasilia (DF). The program intends to bail out the country’s automakers at a time of weak demand for new vehicles.

The final text includes passenger cars, Minivans and SUVs, Trucks and Buses through discounts granted to the consumer, and not by tax reduction to automakers, as was expected.

Total spending of Federal Government is US$ 300 Million (R$ 1.5 Billion). Funds are expected to come from the return of taxes on diesel sales, which was planned to happen in January 2024, but it is anticipated to meet the program of the automotive sector.

For passenger Cars, Minivans and SUVs, discounts range from US$ 400.00 (R$ 2.000) to US$ 1,600.00 (R$ 8.000,00). For commercial vehicles it varies from US$ 6,000.00 (R$ 30.000,00) to US$ 20,000.00 (R$ 100.000,00).

Of the total resources available to fund the program, R$ 500 million will be allocated to businesses involving automobiles. R$ 700 million will be allocated to businesses involving trucks and the remaining R$ 300 million to buses and vans.

To achieve these benefits, car models need to meet the requirements such as energy efficiency, price and 60% nationalization rate of parts.

In the case of heavy, the requirements involve the recycling of models with more than 20 years of use. From the recycling of the used truck, a certificate is issued, and, from it, the consumer will be able to access the bonus.

The idea of removing older trucks from circulation and giving incentives for the purchase of new ones is an old banner of the automakers, which has gained body and proportion with the regulation of the Renovar program.

Source: Automotive Business     Read The Article

PSR Analysis. This package of incentives is the continuation of the fleet renewal program started in 2022. Measures could positively impact the LV and MHV markets, but probably won’t affect MHV. The operations and bureaucracy involved in truck and bus recycling are causing us to wait and see the actual effects of the incentives, rather than changing any projections. The impact on LV was already expected and included in our forecasts.    PSR

Fabio Ferraresi is Director Business Development-South America for Power Systems Research

The agreement covers the acquisition of land and buildings and certain machinery and manufacturing equipment at the General Motors India, Talegaon plant. The proposed acquisition is subject to the signing of a definitive asset purchase agreement, other certain conditions and receipt of approvals from government authorities and stakeholders.

Source: Economic Times    Read The Article

PSR Analysis. Hyundai is expected to expand its annual production capacity in India to some 900,000 units–760,000 units in its two existing plants and 130,000 units in the GM plant. Combined with production volume of its smaller Kia’s two plants in India, the total production capacity of Hyundai Motor Group could surpass 1 million units per year.

With the planned acquisition, the Korean carmaker is betting big on the growth potential of the Indian car market. Last year, car sales in India jumped 25.7% to 4.7 million vehicles, the third largest globally after China and the US. In the burgeoning Indian market, Hyundai is the No. 2 brand with almost 10% market share.

This investment is part of  Hyundai’s commitment to invest approximately US$ 52 million (Rs 4,000 crore) through 2028 to further its plans of launching six electric vehicles (EVs) in the country.

We believe the company will accelerate sales of car models ranging from small sedans and sport utility vehicles to electric cars and will continue addressing the global market from India. Hyundai is likely to manufacture the Venue compact SUV at the Talegaon plant and may use it as a base for made-in-India vehicle exports.   PSR

Aditya Kondejkar is Research Analyst – South Asia Operations for Power Systems Research

SUMMARY.  The global economy performed very well in 2021 and continues to recover, along with trade, employment and incomes. But the revival is unbalanced, with regions/countries, businesses and people facing very different economic realities. Recent improvements also conceal structural changes, which means that some sectors, jobs, and technologies will not return to their pre-pandemic trends. Based on the most recent economic developments and trends, Power Systems Research remains somewhat optimistic about the global recovery.

Many of us hoped to be in the post-Covid phase by now, but it is evident that there is no quick way out.  The pandemic has had a profound impact on the world economy, and it will continue to challenge established norms of life and business into the foreseeable future.  As we start the new year, many challenges remain, new and old alike: re-surgency of COVID variants, restrictions on travel, supply chain challenges, shortages of materials/goods, inflation, and employment, as well as renewed geopolitical tensions across many parts of the globe.

Power Systems Research witnessed a strong economic recovery globally in 2021, despite regional differences.  Output in most OECD countries has now either surpassed or is about to reach pre-pandemic levels, but lower-income economies, particularly those where vaccination rates are low, are at risk of being left behind.  Furthermore, the rebound will continue to vary widely among different market segments.  

Global inflation re-surfaced in 2021 and presents a real risk to economic recovery in all regions. The renewed inflationary pressure risks lasting longer than was expected a few months ago.  The surge in retail and wholesale energy costs in late 2021 will undermine economic growth prospects for large parts of Europe and Northeast Asia well into 2022.  Rising food and energy prices already have impact on low-income households in particular. 

Government support in the form of fiscal policies and public health management are driving the economic rebound and largely explain variations in performance across countries. With the targeted monetary support to consumers and certain industries, the demand for products and services globally bounced back in 2021, and we expect this trend to continue in 2022. 

The overall economic recovery performance has been universal and shows a positive trend globally, but how, when and if specific countries will rebound remains unclear.  According to a report from the Organization for Economic Co-operation and Development as of December 1, 2021, global GDP growth was on track to be 5.6% in 2021, a downward revision of 0.1% since September 2021.  According to the OECD report, GDP has already risen above its pre-pandemic level, but the recovery remains uneven with countries emerging from the crisis facing different challenges.  

For the global outlook in 2022, the OECD left its forecast unchanged since September at 4.5 %. 

To briefly summarize the global industrial outlook for 2022, despite ongoing challenges, it is clear that every market segment globally will continue on the recovery path and show positive growth vs. 2021. 

Among all industry segments on the global scale, the On-Highway segments such as Minivan/SUVs and Passenger Cars are expected to grow at 4.7—5.7% globally in 2022.  This rate is slightly improved from last quarter projections due to the expected improvement in supply chains.  The car industry is one of the major manufacturing sectors being hit by shortages of intermediate goods such as semiconductors, and by bottlenecks in shipping and metals. Car production and sales have been struggling to meet the demand globally while prices for both new and used vehicles have risen in a number of countries.

Following a rapid deterioration of production levels in 2020, we expect global demand and production to continue to increase across the board in 2022, averaging 5.6% vs 2021 among all market segments, which is slightly lower than our previous projection from Q3 2021 (at 7.4%). The decrease in growth expectations is primarily driven by higher inflation rates, ongoing supply chain challenges as well as increased tension with global political agenda.

AGRICULTURAL. In comparison to all other industries, the agricultural machinery segment performed well during the pandemic.  Last year, globally, the segment showed almost 10% growth vs. 2020.   We expect growth to continue for the next few years. However, the growth rates will be slower than in 2021.  We estimate the industry will add 2.8% globally, which is lower by 1.4% from previous Q3 2021 estimates.  Overall equipment production volumes are smaller mainly due to changes in farming practices and are driven by the transition to larger equipment and machines. 

CONSTRUCTION. The global Construction machinery sector showed a strong rebound last year at 9.5%  vs 2020 and is well positioned for continues growth over the next few years.

As we expected, the growth in economic activities regained ground last year; currently, we estimate the global construction equipment market will grow 5.7% in 2022 vs. 2021.  This estimate is higher from the previously forecasted growth from three months ago by about 1.8%

In terms of 2022 growth trends among regions, South/Central America, North America, and India will post the highest recovery rates in 2022 vs 2021, at +16%, 10% and +8.5%, respectively.  The estimates for this sector are slightly improved from our previous quarter projections (Q3 2021).

Other Off-Highway segments, such as Industrial, Lawn and Garden and Power Generation, closely followed the latest global economic conditions last year and we expect the growth will follow the general recover trend as well. We estimate that recovery growth in 2022 vs 2021 in these segments will be +11.3%, +9.1% and 8.6%, respectively. 

For Industrial and Lawn and Garden segments, these estimates are slightly improved from our previous numbers from Q3 2021.  The Power Generation market made much bigger improvements in activities during past quarter.  At the same time, we do not expect any significant growth in this sector, and we see it averaging 5-6% over the next few years.

For the On-Highway sectors in 2021, we saw a solid recovery in production volumes across all product classifications, despite major supply chain disruptions.  Cumulatively, across all on-highway sectors the overall rebound was 4.6% in 2021 vs 2020.  As economic activity rebounds, we expect this trend across all product categories to accelerate in 2022.  The Passenger Cars segment contributes almost 40% of the volume to the overall on-highway vehicles segment.  We estimate a solid gain in growth in 2022 vs 2021 at 5.1% globally, which is lower by 1.5% from the previous estimates, mainly due to overall slower economic projections for 2022.

Passenger Cars The car industry is one of the major manufacturing sectors being hit by shortages of intermediate goods such as semiconductors, and by bottlenecks in shipping and metals. Car production and sales have fallen globally while prices for both new and used vehicles have risen in a number of countries.

Globally, passenger car production is expected to grow at 5.7% in 2022 vs. 2021.  India, Europe, North America, and South/Central America will contribute the most to the increase with rates of 9.6%, 6.6%, 10.1 % and 26.7%, respectively.  Brazil and India are estimated to grow faster than other countries, mainly due to emerging market conditions.  Furthermore, we will continue to see a transitioning trend towards SUVs, which will further impact growth in the passenger cars market.

Recreational Products. This segment follows consumer-oriented products, and the pandemic has provided new opportunities, mainly due to the lock downs and improved work/life balance.  Last year, this segment posted a 6.6% gain vs. 2020 and we expect the growth to continue at 4.5% in 2022 vs 2021. 

Regionally, we expect North America and South/Central America to lead the growth in 2022 at 15.3%, and 39.3% vs 2021, respectively.   PSR

Yosyf Sheremeta, PhD, is Director of Product Management and Customer Experience at Power Systems Research

SUMMARY.  After the GDP declined 3.5% last year, the worst performance in almost 75 years, the US economy is set for a strong comeback.  There are many reasons to be optimistic about the economy for the next few years, including strong readings of macro-economic factors combined with the economic cycle reset backed by government initiatives and policies.

Our positive outlook is based on the reviews of key economic indicators, including GDP, unemployment, and inflation. 

During H1 2021, we witnessed a strong level of activities and a rebound for many industries.  As local governments eased lockdown restrictions, service-oriented industries gained traction and that translated to an overall increase of economic activities across many industries. 

We expect this level of rebound to continue and we now expect even stronger overall growth for 2021.  The US economy is on track to reach or even surpass the growth level of 1984 – the highest one since 1950s.  In the near term, consumer spending will help drive demand and support the strong growth trend.

Many factors contribute to such upbeat projections.  Strong macro-economic data provided a solid basis for future growth.  Government stimulus to consumers as well as businesses combined with investments into a sustainable economy, and technology development will continue to drive demand in the near term.  A future infrastructure bill will also serve as a catalyst to generate new demand and continue the economic expansion for several years.

We have mentioned the electrification trend of vehicles and equipment in the past.  We expect these developments and trends to accelerate in the near future.  In particular, we expect new developments in battery technology, and also with hydrogen power.  The impact of this electrification will touch a majority of the applications/products that we track in our databases.  We already see viable alternatives to ICE powered products entering the market during the next 12-36 months, and this trend will accelerate in the mid-term.

We continue to see a favorable fiscal policy and a stable economic situation in the US.  At this time, we expect it will take at least until 2022-2023 before GDP surpasses its Q4 2019 peak.   Fiscal policy with near zero interest rates, which government has promised to keep in place for the next 12 months, will provide a good platform for the economic recovery and allow us to look optimistically into 2022.  We believe this is a critical factor as it re-assures both consumers and businesses of low interest rates and it helps drive demand for goods and services.  Even then, once the interest rates are lifted from the flat zero levels, we believe they will still provide favorable conditions to continue economic expansion.

The key factor and the foundation to the economic recovery is strong fiscal policy.  With extra cash in the hands of US consumers, combined with low interest rates, and strong growth expectations, inflation concerns have re-surfaced in H1 2021. As of June 2021, annual inflation for the 12 months ending in May was at 4.99%.  In just one month the inflation rate increased by 0.83% from 4.16% as of April 2021.

Increased inflation concerns have put a break on stock market growth, especially to growth-oriented companies such as the technology sector. However, given the current macroeconomic levels, we do not expect any significant change to fiscal policy (such as interest rate increases) this year.  Current conditions provide a solid outlook and reassurance for future recovery and growth at least for another 12-18 months.

We have mentioned significant improvements on the employment market during last 6-9 months, however the trend experienced a slowdown in early Spring 2021.  The latest readings from June 4, 2021, showed the unemployment rate at 5.8%.  While the rate improved from Q1 2021, (April 2021) at 6.2%, it is still significantly higher than the pre-pandemic rating in February 2020 of 3.5%.

The number of unemployed persons as of June 2020 was at 9.3 million vs. 10 million in March 2021 and 5.7 million in February 2020.  We expect the employment market to continue to improve in the H2 2021; it may take at least another year and a favorable economic situation to fully recover employment to the rate of 3.5%-4.5%.  The labor force participation rate was little changed at 61.6 %in May 2021.

Housing starts statistics experienced a slowdown in Q1 2021, however they rebounded during Q2 2021 at 1.572 million in May of 2021.   The building materials market continued to experience pricing pressure as well as supply chain issues which slowed growth.  We expect this trend to continue in the near future.  Another factor that contributed to the slowdown was rising mortgage rates, primarily driven by a rise in Treasuries.  However, given the strong outlook for the economy, we expect the housing market to remain strong, which will directly help drive growth in segments like Construction, Industrial and L&G.

Across all market segments, we expect overall total OEM equipment production numbers to rebound in 2021 from 2020 losses.  Cumulatively, OEM production in the US experienced a decline of 13.1% in 2020 vs. 2019.  We expect growth in 2021 of 8.0% vs 2019.  This estimate is slightly lower by 0.1% than the previous estimates in Q1 2021 at 8.1%, mainly due to the slower recover pace in the Spring of 2021.  The key driver of the growth in 2021 will be strong fiscal policy and accelerated growth in H2 2021.  At the same time, the recovery and growth will vary considerably among segments. 

As expected long before the pandemic, the Medium and Heavy Vehicles Segment was due for a slowdown and a reset.  This segment in 2020 suffered the worst performance among all industry segments; however, it will also lead the recovery in 2021 and will post the highest growth rate at 30.5% vs significant loses in 2020.  We continue to see significant improvements in this segment with sustainable demand over the next 18-24 months.  Furthermore, we estimate an additional gain of 6% in 2022 vs 2021.

Consumer-oriented segments experienced significant market deterioration with the Passenger Car segment leading the decline at -25.1% in 2020 vs 2019.  The next leading segment was Minivan/SUVs at -16.3% in 2020 vs 2019.  We expect passenger car production to remain flat in North America while Minivan/SUVs to regain ground in 2021 at 10.1%.

As economic conditions improved during the last three months, we expect a rapid increase in demand for products to follow in most markets, starting in H2 2021. At this time, we forecast year 2021 growth to be in the low single digit vs 2020 at 8.0%, and we see an 9.7% additional gain in 2022 vs 2021.  Overall, for all OEM equipment sectors, we expect it will be 2023 or 2024 before the total volume units produced in North America reaches pre-pandemic levels of Q4 2019.

Here are our views on several key industrial segments.

AGRICULTURAL.  As the post-pandemic recovery continues, we expect the Ag segment to follow other industrial and heavy equipment industries.  In 2021, we project the growth of agricultural equipment and machinery in North America to be at 9.8% vs 2020. Additional growth is projected for 2022 at 13%.  The recovery will be steady, and we expect levels of production in 2022 to reach those of 2016-2017. 

CONSTRUCTION EQUIPMENT. We expect the Construction machinery segment to follow strong economic recovery patterns.  Our most recent overall projection on construction equipment and machinery production is positive at 8.9% in 2021 vs 2020, which is slightly higher than Q1 2021 estimates.  Furthermore, we expect additional growth of 9.7% in 2022. 

INDUSTRIAL. This segment typically follows the general economy, and the construction industry trends, with some minor equipment exceptions, such as forklifts.  Currently, we expect an overall growth in production numbers at 9.6% in 2021 vs 2020 with additional growth of 12.4% in 2022. 

The main drivers for the segment are small industrial equipment, material handling and forklift applications, where the demand remains strong.   Furthermore, material handling is supported by stronger levels of freight, and we expect this trend to continue in 2021-2022.

Consumer sectors, including LAWN AND GARDEN, PASSENGER CARS, MINIVANS AND SUVs as well as RECREATIONAL PRODUCTS look very promising for the next few years.  Not only have these segments entered a new cyclical uptrend, but they will also benefit from favorable fiscal policy and increased demand driven by the economy re-opening.

LAWN AND GARDEN. This segment typically follows a similar pattern to other consumer products; however, given the circumstances related to lockdown, the L&G sector performed very well in 2020 (production was flat in comparison to 2019).  We estimate L&G to continue strong performance, driven by healthy demand at 6.8% in 2021 vs. 2020 with additional growth of 9.9% in 2022. During the past year, the segment has suffered supply chain issues. 

During the past few quarters, we have been gathering intelligence on new electric models, and we will be completing data and releasing them to our client databases over the next few quarters.   Given current market circumstances and the trend in the industry, we believe electric models will follow similar growth rates to its ICE units and will greatly gain market share at the expense of ICE-powered equipment.

PASSENGER CARS and MINIVAN/SUVS. Strong demand supported by low interest rates and a re-opening of the economy will help these segments regain ground in 2021.  At the moment, we expect the segment to show healthy growth in 2021, mainly due to a low base in 2020.

However, given the current trend, specifically the market transitioning to SUVs, the production volumes of passenger cars may never fully come back to the levels of 2016-2017.  We estimate production for passenger cars to be flat in 2021.  Additional growth of 10.7% and 7.8% is expected in 2022 and 2023, respectively.

Over the past few years, the Minivans/SUVs segment has been enjoying growth and taking share from passenger cars. Nevertheless, the overall production has declined at 16.3% in 2020 vs 2019.  We estimate the rebound in 2021 to be at 10.1% vs 2020.  Steady recovery next year is estimated to continue in the following years at 10.9 and 6% in 2022 and 2023, respectively.

We have already started to witness introduction of EV technology across all major OEMs, and we expect this trend to significantly accelerate in the next 2-4 years. 

POWER GENERATION. This segment will mainly follow other industrial segments and will gain 8.1% in 2021 after being almost flat in 2020 vs. 2019.  The recovery will mainly depend on improved economic conditions in the region and worldwide.  We expect the segment to continue to improve in 2022 at 8.9% vs. 2021.  Key demand drivers for the segment come from data centers, healthcare, and infrastructure development.

RECREATIONAL VEHICLES. Recreational Products follow similar patterns to other consumer products; however, the pandemic provided a solid growth boost for the segment.  We project a strong year at 9.8% growth in 2021 vs 2020, and 8.5% in 2022 vs 2021.  PSR 

Yosyf Sheremeta, PhD, is Director, Product Management & Customer Support, for Power Systems Research

SUMMARY.  In our previous forecasts, we have discussed some hope for a V-shaped recovery, it did not materialize.  Our conclusion was based on several factors, such as the current economic cycle, overall strength of the economy, fiscal policy, political landscape in the US and globally, etc. After managing through the early stages of the pandemic in H1 2020, we saw good trends in H2 2020 and we had reasons to be optimistic for a quick recovery.

However, the recovery took a slight pause during the last few months.  Unemployment continued to increase, and regional lockdowns prevented the necessary demand for a significant year-end growth.  Now that the elections are over, we’ll have yet to see what the new administration will be able to achieve during the next two years.  Specifically, if the long awaited infrastructure reform can be passed.  However, fiscal policy with near zero interest rates, which government has promised to keep in place for the near future, will provide a good platform for the economic recovery and allow us to look optimistically into 2021-2022.

Currently, we expect a slow but steady economic growth in 2021 with accelerating recovery trends taking place in the second half of the year. As we have said in the past, we believe the US has been able to manage and weather the storm quite nicely.  While many industries struggled with the pandemic more than others, the overall economy in the US is in the slow and steady recovery mode.  We continue to see a favorable fiscal policy and a stable economic situation in the US.  At this time, we expect it will take at least until 2022-2023 before GDP surpasses its Q4 2019 peak.

The key factor and the foundation to the economic recovery is strong fiscal policy.  Not only has the US Federal Reserve Bank slashed its interest rate to 0% since March 2020, it also promised to keep it at zero or near zero into 2021-2022. 

We believe this is a critical factor as it re-assures both consumers and businesses of low interest rates and it helps drive demand for goods and services.  To prove this point, take a look at US stock market: it hit its record high and it continues to stay at that level.  The stock market may look overvalued at the moment, but that does not bother investors.  As long as the interest rates remain low, there will be a room for new growth.

Inflation levels will be rising slightly in 2021 for consumer-oriented products, but that does not seem to influence economic recovery at the moment. Nevertheless, current conditions provide solid outlook and reassurance for future recovery and growth.

We have mentioned a slowdown in new employment during Q4 2020.  The latest readings from Jan. 8, 2021 showed the unemployment rate at 6.7%.  While the rate improved from Q3 2020, (September 2020) at 8.4%, it is still significantly higher than pre-pandemic rating in February 2020 of 3.5%.  The number of unemployed persons currently was at 10.7 million in December 2020. vs. 5 million in February 2020.  We do not expect any significant and rapid changes to the employment data in 2021; it will take another 18-24 months and a favorable economic situation to fully recover employment to the rate of 3.5%-4.5%.

Housing starts regained recovery speed during Q4 2020.  The numbers for November were better than expected at 1.547 million.  This was the highest reading since pre-pandemic February 2020.  Low interest rates and low inventory propelled the growth. Going forward, we expect the housing starts to remain strong and steady, which will directly help drive growth in segments like Construction, Industrial and L&G.

Across all market segments, we expect overall total OEM equipment production numbers to rebound in 2021 from 2020 loses.  Cumulatively, OEM production in the US experienced a decline of 19.3% in 2020 vs. 2019.  We expect the growth in 2021 of 7.9% vs 2019.  This estimate is higher by 1.2% from the previous estimates in Q3 2020 at 6.7%.  The key driver of the growth in 2021 will be strong fiscal policy and accelerated growth in H2 2021.  At the same time, the recovery and growth will vary considerably among segments. 

As expected long before the pandemic, Medium and Heavy Vehicles was due for a slowdown and a reset.  This segment in 2020 suffered the worst performance among all industry segments; however, it will also lead the recovery in 2021 and will post the highest growth rate at 13.6% vs significant loses in 2020.  We continue to see significant improvements in this segment.  Furthermore, we estimate an additional gain of 17.5% in 2022 vs 2021.

Consumer-oriented segments experienced significant market deterioration with the Passenger Car segment leading the decline at -30.2% in 2020 vs 2019.  The next leading segment was Minivan/SUVs at -23.3% in 2020 vs 2019.  We expect these two segments to regain ground in 2021 at 8.1% and 8.9%, respectively. 

On the opposite side from consumer products, heavy industrial segments, such as Railway (at -9.4%) and Marine Auxiliary (at -12.3%) posted small losses in 2020 vs 2019.  Their recover growth rate will also be in the single digits and will not be as high as for the consumer products.

Currently, we do not see a return to significant economic activities and rapid increase in demand for products in most markets until H2 2021. At this time, we forecast year 2021 growth to be in low single digit positive vs 2020 at 7.9%, and we see an 8.8% additional gain in 2022 vs 2021.  Overall, for all OEM Equipment sectors, we expect it will be 2023 or 2024  before the total volume units produced in North America reaches pre-pandemic levels of Q4 2019.

AGRICULTURAL.  Productionof agriculturalmachineryand equipment has been suffering for the past 5-6 years, where production levels have fallen significantly since 2015.  Year 2020 looked promising due to many factors; however, the recovery was put on hold by the pandemic.  

Corn and soybeans are the two most widely planted crops in the nation, accounting for 55% of principal crop acreage. 

The prices for these two commodities improved drastically in 2020, mainly driven by increased demand.  Since June 2020, both corn and soybean prices have continued to increase.  As of January 2021, soybean prices are at $14 per bushel, which is highest level since March 2014.  Key factors in driving prices to current levels were prolonged dryness in key crop-growing regions of South America, labor issues in Argentina, and strong demand from China. Expectations that the US will cut domestic supply forecast for the crops in its next crop report have also lifted prices.

Corn prices have also gained significantly since June 2020.  Concerns about tight supplies in 2021 have pushed corn, soybean and wheat futures to multi-year peaks, hitting levels not seen since 2014.

As the recovery continues, we expect the Ag segment to follow other industrial and heavy equipment industries.  In 2021, we project a growth of agricultural equipment and machinery in North America to be at 8% vs 2020.  Additional growth is projected for 2022 at 11.8%.  Agricultural segment has weathered the pandemic better than other industrial sectors.  The recovery will be steady, and we expect levels of production in 2022 to reach those of 2016-2017. 

CONSTRUCTION EQUIPMENT. At the onset of the pandemic, the outlook for construction machinery was not optimistic at all.  However, given the strong housing starts and high levels of infrastructure spending, the growth projections for the segment are favorable.  Furthermore, government is working on the new Infrastructure bill and is committed to support the demand in the sector by investing heavily in infrastructure and green technology.  We have yet to see if this bill will make it to the top of the agenda for the new administration and what it will look like if it gets there, but we believe the chances of positive developments are quite high. 

Our most recent overall projection on construction equipment and machinery production is positive at 7.4% in 2021 vs 2020, with additional growth of 8.6% in 2022. 

INDUSTRIAL. This segment typically follows the general economy, and the construction industry trends, with some minor exceptions, such as forklifts.  Currently, we expect an overall growth in production numbers at 7% in 2021 vs 2020 with additional growth of 8.6% in 2022. 

On the same note as in Agricultural and Construction, we expect new rebalancing of distribution of market shares and supply chains.  The overall growth dynamic is closely mirroring the Construction segment. The main drivers for the segment are small industrial equipment, material handling and forklift applications, where the demand remains strong.   Furthermore, material handling is supported by stronger levels of freight, which greatly improved in H2 2020 in comparison to April-May of 2020.

Consumer sectors, including LAWN AND GARDEN, PASSENGER CARS, MINIVANS AND SUVs as well as RECREATIONAL PRODUCTS, will need to adapt to a new economy.  As mentioned earlier, consumer-oriented segments suffered the greatest decline in 2020.  This is mainly due to market saturation in previous years and almost complete lack of demand in Q2 2020, which was mainly caused by high unemployment and future uncertainty.  During H2 2020, we saw demand come back and we project this trend to continue and regain ground.

LAWN AND GARDEN. The segment is following a similar pattern to other consumer products, but the declines in 2020 were not as steep (at -13.25) as in the personal transportation segments. We estimate L&G to regain ground and grow at 7.6% in 2021 vs. 2020 with additional growth of 8.6% in 2022

The Lawn and Garden market is set to establish one of the strongest adoption rates among all other segments in the introduction of battery-powered models and technologies. In addition to the consumer side, we also see this trend sparking a significant interest among commercial buyers for Lawn & Garden equipment.

During the past few quarters, we have been gathering intelligence on these electric models, and we will be completing data and releasing them to our client databases over the next few quarters.   Given current market circumstances and the trend in the industry, we believe electric models will follow similar growth rates to its ICE units and will greatly gain market share at the expense of ICE powered equipment.

PASSENGER CARS and MINIVAN/SUVS. The passenger car segment was already experiencing a slowing of demand over the past few years, mainly due to the market transition to SUVs as well as a younger population transitioning to an urban lifestyle and an increase in the popularity of mass transit, etc.  However, the pandemic pushed the segment into a virtual halt during Q2 2020.  The demand for passenger cars started to return in H2 2020.    We have seen passenger car production decline the most among consumer-oriented products and the second largest decline (after Medium and Heavy Vehicles) among all sectors we track.  The decline in production in 2020 was almost at 30% vs 2019.

At the moment, we expect the segment to regain ground in 2021, at +8.1% vs. 2020, mainly due to a low base in 2020. However, given the current trend, specifically the market transitioning to SUVs, the production volumes of passenger cars may never fully come back to the levels of 2016-2017.  Additional growth of 10.3% and 8.6% is expected in 2022 and 2023, respectively.

Over the past few years, the Minivans/SUVs segment has been enjoying growth and taking share from passenger cars. Nevertheless, the overall production has declined at 23.3% in 2020 vs 2019.  We estimate the rebound in 2021 to be at 8.96% vs 2019.  Steady recovery next year is estimated to continue in the following years at 9.2 and 5.1% in 2022 and 2023, respectively.

MEDIUM AND HEAVY VEHICLES.  Commercial truck demand rebounded in the fourth quarter of 2020, particularly in the class 8 segment.  Order rates for class 8 came in stronger than expected which bodes well for production through at least the first half of 2021.  Freight rates remain relatively high and this trend is expected to continue throughout the year.  Congress passed another round of economic stimulus which also bodes well for commercial vehicle adoption.  While the Coronavirus continues to negatively impact the economy overall, PSR does not believe the effects will cause a significant slowdown in demand in this segment in 2021.

Last year (2020) the production dropped about 35% vs 2019 peak year. While down significantly, the final overall performance in the segment was much better than initially expected.  The market rebound started in H2 2020, and we expect that trend to continue well into 2021-2023. We project a healthy growth in 2021 at 13.6% vs 2020, following by 17.5% and 5.7% in 2022 and 2023, respectively.  However, the market will not return to pre-decline levels for at least a few years.

POWER GENERATION. This segment will mainly follow other industrial segments and will gain 7.4% in 2021 after losing 11.1% in 2020 vs. 2019.  The recovery will mainly depend on improved economic conditions in the region and worldwide.  We expect the segment to continue to improve in 2022 at 7.9% vs. 2021.  Key demand drivers for the segment come from data centers and infrastructure development.

RECREATIONAL VEHICLES. Recreational Products follow similar patterns to other consumer products, but the 2020 declines were not as steep as in the passenger car segment.  In 2021, the overall production for all products declined at 19% vs 2019. Going forward, we project 6.7% growth in 2021 vs 2020, and 7.6% in 2022 vs 2021. 

We believe the demand for recreational vehicles (motorcycles) will significantly fall in the next few years, unless economic conditions prove better than expected.  Furthermore, we expect continuous redistribution of power and balance among industry OEMs as demand for products changes with demographics.  Most likely, we will see OEMs entering the market with new products, aimed at niche markets, as they hunt for increased market share.

RAILWAY. This segment follows economic conditions in the region, and we expect it to gain 6.7% in 2021 vs. 2020.  This segment mainly follows the natural (organic) rate of replacements. In 2022, we will see growth at 8.5% vs 2021.  PSR 

Yosyf Sheremeta, PhD, is Director of Product Management & Customer Experience at Power Systems Research

Diversification has become the theme during the pandemic recovery, and we expect this trend to continue.  Not only are companies looking for new markets and suppliers to grow top and bottom line revenue as well as to minimize risks, but we see a shift into new industries.  Furthermore, rapid developments of new technologies create massive opportunities for OEMs and suppliers as well as posing real threats to OEMs that solely rely on traditional products that are powered by fossil fuels. 

According to a report from the Organization for Economic Development (OECD), the global economy is still expected to shrink this year, but by less than previously estimated.  Currently, the OECD expects the world economy to decline by 4.5% in 2020, which is better than the earlier estimated contraction of 6%; this is mainly driven by better-than-expected recoveries in the U.S. and China.

This is the election year in the US and the world will be closely watching the outcomes in November.  Typically, we see a lot of uncertainty during the last few quarters before the election, as it will have an impact on the global economy.  Companies preserve cash and postpone major capital investments until they understand the playing field and rules of new administration; current geo-political trends related to trade disagreements and the exposed supply chain weaknesses and challenges brought to us by the pandemic- both have a direct impact on the recovery trends and future growth.

When we look at industry developments during first three quarters of 2020, it is clear that every market segment globally was negatively impacted by the pandemic.  The only exception is China’s Construction segment, which is primarily driven by stable demand supported by government investments. 

Among all industry segments on the global scale, the On-Highway segments such as Passenger Cars, Minivan/SUVs and Commercial Vehicles segments have suffered the greatest decline, dropping 16-25%. This is mainly due to production peaking over the past couple of years; these sectors were due for a slowdown, regardless.

Consumer oriented applications will suffer most, mainly due to a lack of demand caused by business shutdowns, unemployment, and short-term elimination of financial wealth.  The overall decline in these markets will be well into double digits with some suffering 25-40%, regionally.  Globally, personal transportation sectors such as Passenger Cars and Minivan/SUVs will suffer close to a 20-25% decline in 2020.  On the other hand, heavy industrial segments, such as Agricultural Equipment and Power Generation will be down in high single digits.

These are our current estimates as of today; going forward and depending on the segment we do expect these numbers to change in both directions. 

On the positive side, following a rapid deterioration of production levels in 2020, we expect demand and production to increase across the board in 2021, averaging 5.18% among all market segments, which is higher by 0.3% than our forecast from previous quarter and by 1.6% vs Q1 2020 estimates.  At this point, we believe it will take 2-3 years for the general economy to come back to pre-COVID levels and for some segments it will be even longer than that.

AGRICULTURAL. Given the current circumstances globally, we expect 2020 to finish in negative territory.  Our latest estimates of production volumes show a decline of 7.9% in 2020 vs 2019, which is an improvement from last quarter by 1.5%.  China is the largest producer of Ag equipment globally, but most of the volume falls under the 2-wheel drive tractors application.  Over the past few years this product category has been shrinking significantly, mainly due to the product replacement by larger HP machines.  

Globally, we do not expect any rapid recovery next year (2021) or high growth, mainly due to current economic conditions.  We expect 2021 growth will be at 2.7% globally, which is slightly higher (by 1.7%) than our estimates as of last quarter and 3% higher than estimates from Q1 2020.  Such trend shows better than expected recovery and we believe Ag machinery segment is nicely positioned for stronger recover and steady future growth. 

China will contribute most to the decline in overall global performance at -2.8% in 2021 (mainly driven by the decline in smaller equipment and the shift to larger HP machines); at the same time, Europe, Central/South America and India will show much stronger recovery at 9%, 11 % and 11.9% respectively.  We certainly see a steady recovery patten, however the key factor to agricultural machinery growth will depend on overall speed of economic recovery from the pandemic.

CONSTRUCTION. The global Construction sector has performed very well for the past five years, posting an overall growth rate of 9.6% in 2018 and 1.9% in 2019 globally. The latest crisis has eliminated this growth trend.  At this time, we estimate the global construction equipment market will drop 9.3% in 2020 vs 2019. This rate is higher by 2% vs. previous quarter estimates. 

At the same time, we expect a recovery and growth at 7.1% in 2021 vs 2020, which is higher by 0.7% then previous estimates.  The recovery pattern certainly seems to be improving in comparison to estimates just six months ago.  However, the markets will not recover to pre-crisis levels for another few years, at best.  India, Europe and South/Central America will contribute the most to the recovery in terms of growth in 2021 vs 2020, at +32%, 8.9% and +8.4% respectively.

Other Off-Highway segments, such as Industrial, Lawn and Garden and Power Generation, will closely follow the latest global economic conditions. Currently, we expect them to decline in 2020 vs 2019 at -10.6%, -13.9% and -7.8%, respectively.  The recovery in the following year will take place at rather slow rate.  We estimate that 2021 growth vs 2020 in these segments will be +6.7%, +4.4% and 0.1% respectively.  

Marine Auxiliary and Maine Propulsion sectors will finish the year with -11.3% and -12.2%, respectively.  Cumulatively, most decline will take place in India (-23.7%), North America (-15.1%) and Far East (-12.4%).  Promising recovery at this point is expected in 2021 at an overall rate of 5.8% vs 2020.  This is an improvement by 1.5% from the previous estimates in Q2 2020.

For the On-Highway sectors, we will see a decline in production volumes across all product classifications.  Cumulatively, across all on-highway sectors the overall decline will be at -21.6% in 2020 vs 2019.    This is an improvement by 1.8% from the previous estimates in Q2 2020.

Passenger Cars will suffer the largest decline among consumer-oriented applications, as demand rapidly collapsed with the progression of the virus crisis.  We estimate that globally passenger car production will decline 25.6%, with India, North America and South/Central America contributing the most to the decline rate at -28%, -32.6% and -43.7%, respectively.  We estimate a small recovery within the segment at 5.4% in 2021 vs 2020, where Central/South America, South East Asia and India are estimated to grow faster than other regions at 39.7%, 15.9% and 15.3%, respectively. 

Minivan/SUVs will go in line with the Passenger Cars segment.  Overall decline will be 19.2% in 2020 vs 2019; where India, Eurasia and Central/South America are leading in the decline at -22.4%, -34% and 20.9% respectively.  The small recovery in 2021 will also be in line with the passenger car segment at +5.2% vs 2020.  Regionally Central/South America, India and South East Asia will be growing faster than other regions at 44.3%, 15.3% and 15.9%, respectively. 

Light Commercial Vehicles will decline 15.6% in 2020 vs 2019 globally.  Significant declines will take place in India, North America and Central/South America at -45.3%, –25.4% and -31.%, respectively.  Small recovery is expected in the following year (2021) at 5.6% overall globally.  Regions with higher recovery rates will be India, Eurasia, and Central/South America, which are expected to post gains of 44.3%, 13.9% and 21.4%, respectively. 

During the past few quarters, we have forecasted that demand and production of Medium and Heavy Vehicles were expected toslow downin 2020-2021.  Peak production volumes in previous years as well as COVID-19 impact will have a profound impact on the segment, which is forecast to suffer most among all sectors we track in our databases.

At the same time, the MHV segment has made most improvements in the forecast for 2020 and has shown faster progression in the recovery estimates from previous quarters.  Currently, we expect production volumes in 2020 to be down at -15.9% globally.  Most regions will experience double digits decline, with North America, Europe, India and Far East declining at 39.1%, 32.8%, 61.9% and 28.4%, respectively.  We do expect modest recovery in 2021 at 5.4% overall vs 2020.  Regionally, the growth rates in India, Central/South America and North America are expected to be 40.3%, 23.7% and 16.1%, respectively.

Recreational Products follows consumer-oriented segments, but globally the decline overall will not be as significant is in the Passenger Car and Minivan SUVs segments.  Currently, we expect the decline in 2020 to be at -12.1% vs 2019.  The key factors to better performance in Recreation products are affordable personal transportation (motorcycles) and significant demand for RV, driven by the pandemic and the travel restrictions. 

Most of the volume (2-wheelers) is concentrated in China, and as of now we do not forecast any major decline there for the current year.  Other regions, such as India, Europe and North America will decline at rates of -23%, -33.8% and 20.1%, respectively.  The recovery in 2021 is expected to be 5.8% globally, where India and South/Central America are leading the growth at 11.1% and 6.1%, respectively.   PSR

Yosyf Sheremeta, PhD, is Director of Product Management and Customer Experience at Power Systems Research.

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.”

The U.S. economy is still healthy and growing; however, job growth has been flat to steady.  The reported number for December 2019 was 130,000.  Government reports from January 10, 2020, showed a healthy unemployment rate at 3.7%.  Employment continued to show steady numbers in several industries, including mining, manufacturing and transportation. Job growth in these industries moderated in 2019 compared with 2018.

Across all market segments, we expect overall total OEM equipment production numbers to be almost flat for 2020, which is slightly better than our estimates from Q3 2019 at 1.02%. The Medium and Heavy Vehicle segment is the only one that is significantly different among all 13 market segments that we track. We project that production for that segment will be down 15% in 2020 compared to 2019. We’ll discuss more about this later in this report. 

We see an almost flat to slightly negative level of overall activity in 2021 at -1.5%, as the overall economy performs at its peak in productivity, and as demand levels decline going into 2020-2021. 

The following segment level summaries describe some of the key drivers and factors we are we are evaluating by segment:

Note: The full report for the North America, with details on expected unit and percentage changes, is available to our subscription-based clients in our quarterly update bulletin.  

AGRICULTURAL.  The Agricultural segment suffered multiple setbacks in 2019, driven by several factors.  The weather was not cooperative – with the above average rain fall levels—and many fields in the Midwest remained too wet during planting season to be used; such conditions prevented farmers from replacing their equipment, and they postpone their capital spending and buying decisions. 

Ongoing trade uncertainties with China left US farmers with excessive inventories of key commodity items such as soy and pork.  Given the current rhetoric on the trade situation, particularly with China, we expect such conditions to be flat in 2020. According to a proposed U.S. China Phase One trade agreement slated to be signed in January 2020, China agreed it will import more U.S. wheat, rice, corn, energy, pharmaceuticals and financial services.  Such moves should help the sector regain stability and return to growth. 

CONSTRUCTION EQUIPMENT. Recent market performance has been very good, but the first signs of a slowdown appeared in declining sales during the second part of 2019, especially with larger equipment.

Major OEMs in the Construction and Industrial segments reported significant increases in orders and activities in 2018 and 2019, but demand seems to be tapering off, mainly due to overall economic and market performance, as well as uncertainty.

As in the Agricultural sector, we have started to see the introduction of new technologies and electric drive types. We project this trend will rapidly increase over the next few years, and it may start gaining significant market share within 5-10 years.

INDUSTRIAL. We see very similar trends in growth for the Industrial segment as the overall growth dynamics closely mirror the Construction segment. The main drivers for the segment are small construction equipment, material handling and forklift applications, where the demand remains strong.

Consumer sectors, including LAWN AND GARDEN, PASSENGER CARS, MINIVANS AND SUVs as well as RECREATIONAL PRODUCTS, continue to benefit from the strong economy and low Interest rates. These segments performed very well over the past few years (2016-2019).

LAWN AND GARDEN segment shows steady demand, and the growth trend will remain flat to slightly positive in 2020 and then shifting into a slight downward trend towards 2021. The key drivers for this segment are solid housing starts and a strong economy; however, lower housing starts will slow the growth in this segment.

The Lawn and Garden market is set to include one of the strongest adoption rates among all other segments in the introduction of new battery-powered models and technologies. During the past few quarters we have been gathering intelligence on these electric models, and we will be completing data and releasing them to our client databases over the next few quarters.

Passenger Cars and Minivan/SUVs segments have experienced a continuous slight slowdown in demand since late 2016.  New vehicle sales as well as profits continued to decline in 2019. 

Overall, for 2020, we expect Passenger Car segment production volumes to drop as many consumers transition into the small SUV sector or drive their current car longer in taking advantage of today’s more reliable and durable car.

The smaller size SUV market is rapidly gaining momentum vs. large SUVs with many products coming from major global OEMs. We expect this niche market to continue to develop and be solid in the next few years with many more new product offerings from major OEMs.

Another point worth mentioning is the adoption of electric vehicles, which has been gaining ground very rapidly. Most OEMs will have solid electric product offerings within a couple of years, and we expect to see a more rapid increase in sales of electric vehicles.

At this point, the overall share of electric vehicles is still insignificant, but it is growing very rapidly; we expect this trend will accelerate much faster over the next five years. While we expect electric cars to gain in popularity, they will not gain any significant share of the total market in the near term.

MEDIUM AND HEAVY VEHICLES. After very strong demand for class 8 trucks during the past few years, the market has started to cool primarily due to an overcapacity of trucks in the market.  While freight demand is expected to be relatively strong in 2020, tonnage started to slow toward the end of 2019. 

Continued uncertainty surrounding the Chinese tariffs along with an overall slowdown in global economic growth is weighing on the freight segment.  While a slowdown in the medium duty truck segment is also expected in 2020, truck demand is not expected to decline as significantly as the class 8 segment.

POWER GENERATION. Things look good for the segment but underlying weaker global economic conditions will put pressure on the power generation markets.  Overall, the segment will follow overall economic conditions in the region.

For more information, please see our detailed analysis on the segment, published in September 2019 edition of Diesel Progress magazine.

RECREATIONAL VEHICLES This sector follows consumer sector trends and posted very good growth in 2019 vs. 2018.  Furthermore, the prospects for growth in 2020 looks promising vs. 2019. The key drivers for the segment are a peak in the economic cycle, higher interest rates as well as a change in demographics.  PSR

Yosyf Sheremeta is Director of Product Management & Customer Experience at Power Systems Research

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.    

Read The Article

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

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.  

Please see the below charts. Since 2005, this show held once every two years. 

This time, in order to get new interests, it also invited family-oriented planning such as work experience in the automobile industry, and other industries such as electronics and communications. 

There was a tendency to break through the feeling of rut that was seen in 2017 and earlier. For example, work experience events in the automobile industry for children and enhancement of gourmet booths. There were many hands-on exhibitions, and there was an effort to break away from the event of just watching a car. 

Exhibits of compact EV, V2H and sharing mobility were very conspicuous. There was an enthusiasm for visitor learning as a reality in near future. 

The features of this show seemed to fall into two basic classes: Compact EVs and V2H (Vehicle to Home) concept models.

Compact EVs

This is due to the road network in Japan, especially in urban areas. Many models that meet the demand for EVs suitable for narrow alleys have been proposed. Currently, the smallest class in Japan is the “Kei” class with less than 660cc. There is a trend to promote a more compact ULV (Ultra Lightweight Vehicle). 

Much of the ULV development is almost complete. Currently, it is in the stage where demonstration experiments such as sharing are being conducted. Many models have a cruising range of about 100km and can be recharged at home outlets in about 5 to 6 hours. The expected selling price is about 1 to 1.5 million yen, which is cheaper than Kei Car. The maximum speed is 60km / h, so it is not possible to drive on a highway, but it is expected that cost reduction can be achieved by eliminating excessive safety equipment. 

V2H Concept model 

In Japan, which is a major disaster country where 10% of global disasters occur in Japan, the exhibition that actively promotes V2H (Vehicle to Home) is conspicuous. The EV may be interpreted as a “movable battery” and the market may recognize its value as a mobility that can move to a necessary location and supply power in the event of a disaster. I think that it is a very useful way of thinking to increase added value, not just as a means of transportation. Although the power supply to the grid will be a story ahead for some time, it makes a lot of sense to supply emergency power. 

Of course, even during normal times when there was no disaster, V2H in the original sense that EV batteries cover a certain amount of household electricity was also received very favorably, and many visitors were interested. . In Japan, where home-use stationary fuel cell systems are already widespread, the general understanding is that living expenses can be saved by providing electricity for one’s own home. In Japan, resistance to the idea that mobility can take on this function is weak. 

As overseas brands such as BMW and VOLVO stopped exhibiting at this show, the brand power of the Tokyo Motor Show was feared to decline. 

According to statistical information from JAIA (Japan Automobile Import Association), the number of newly registered foreign OEM cars in the first half of 2019 is 149,010, 98.2% of the previous year. Mercedes-Benz is 97.7%, Volkswagen is 92.4%, BMW is 100.0%, Audi is 80.5%. From such a current situation, it is no wonder that overseas brands become a mind that they do not expect much from the Japanese market. Because the Japanese automobile market is shrinking, growth is not expected and there is no need to invest resources there. That judgment is probably not wrong. However, this is not limited to Tokyo, and the number of exhibitors at motor shows is also decreasing in Paris, Frankfurt and Detroit. 

In the past, there were times when motor shows were directly connected to branding, such as the announcement of new models and the release of new technologies. However, the era when such functions were required for motor shows may be over. 

It may be a role for social media or teaser site now. Promoting new products online makes it easier to reach your target audience. Another advantage is that it can be released to the world at the same time. However, it will reach users who are interested in it, but not to users who are not interested in cars. The organizers knew this well and came up with a variety of ideas to make people interested in cars, including preparing various hands-on events for children. 

Exhibitors and organizers are currently exploring the importance of a motor show. Opportunities for automobile OEMs around the world to gather in one place will be lost. In other words, it is synonymous with the localization of the motor show itself. Europe, the United States, Japan, the demand varies depending on each region, and I think that it will become a motor show that fits each region. 

The number of visitors may decrease as the number of people who are not interested in car ownership increases in the future, however, a place where mobility companies can propose the future, and also people can experience the near-future tech, the Motor Show will continue to evolve while changing its role.  PSR

Slides From The Show

Click an image to view a larger version in a slide show.

Aidea AA 4 2

Aidea AA 4

Aidea Aa Cargo V2h 2

Aidea Aa Cargo V2h 3

Aidea Aa Cargo V2h

Aidea E Trike 2

Aidea E Trike

Aisin I Mobility Type C2

Aisin I Mobility Type C

Alpine Booth

Daihatsu Autonomous Driving Public Transporter Icoico

Daihatsu Booth

Daihatsu Compact Minivan Waiwai

Daihatsu Copen Gr Sport 2

Daihatsu Copen Gr Sport

Daihatsu Next Gen Kei Truck Tsumutsumu

Daihatsu Next Gen Suv Wakuwaku

E Apple Prod By Jiyuan 2

E Apple Prod By Jiyuan

Fuso Aeroqueen

Fuso Booth

Hino Booth

Hino Dakar Rally Race Truck

Hino Flatformer Booth

Hino Flatformer Concept

Hino Flatformer

Hino Flatformer Li Ion Battery

Hino Gh11

Hino Gh8

Honda Booth

Honda Cb 2

Honda Cb History Theater

Honda Cb

Honda E500

Honda E500 Lifestyle

Hondae

Honda Nbox

Honda Nsx

Isuzu Booth

Isuzu Elf Ev2

Isuzu Elf Ev3

Isuzu Elf Ev4

Isuzu Elf Ev

Isuzu Erga Duo Hybrid

Isuzu Future Logistics Intelligent Relay 2

Isuzu Future Logistics Intelligent Relay

Japia Booth

Jtekt Skelton Mechanical Working Sample 2

Jtekt Skelton Mechanical Working Sample 3

Jtekt Skelton Mechanical Working Sample

Kawasaki Booth

Kawasaki Teryx Krx 1000 2

Kawasaki Teryx Krx 1000

Kids Event

Koito Booth

Marelli Booth

Marelli Inverter

Marelli Motor Installed For Nissan Leaf

Mazda Kids Event

Ministry Of Environment Nano Cellulose Vehicle 2

Ministry Of Environment Nano Cellulose Vehicle 3

Ministry Of Environment Nano Cellulose Vehicle

Ministry Of Environment Super Energy Saving Vehicle 2

Ministry Of Environment Super Energy Saving Vehicle

Mitsubishi Delicads

Mitsubishi Eclipse

Mitsubishi Engelberg

Mitsubishi Rvr

Ngkntk Booth

Nissan Fairladyz 2

Nissan Fairladyz

Nissan Gtr

Nissan Leaf Nismo

Renault Megane

Subaru Levorg Prototype

Subaru Viziv 2

Subaru Viziv

Suzuki Booth

Suzuki Jimny Cierra

Suzuki Jimny

Suzuki Outboard

Tajimaev Booth

Tajimaev E Runner Uld1

Tajimaev E Runner Ulp1

Tajimaev Tajima Jayuan Car Sharing Model

Telecommunication Company Docomo Booth

Tms2019 Place

Toyota Booth Have No Mass Production Car

Toyota Businessliner 2

Toyota Businessliner 3

Toyota Businessliner

Toyota E Care

Toyota E Palette 2

Toyota E Palette

Toyota E Racer

Toyota Pmcv Concept

Udtrucks Booth

Yamaha Booth

Yamaha Land Link Concept

Yamaha Mw Vision 2

Yamaha Mw Vision 3

Yamaha Mw Vision

Yamaha Tri Town 2

Yamaha Tri Town

×

Aidea AA 4 2

Aidea AA 4

Aidea Aa Cargo V2h 2

Aidea Aa Cargo V2h 3

Aidea Aa Cargo V2h

Aidea E Trike 2

Aidea E Trike

Aisin I Mobility Type C2

Aisin I Mobility Type C

Alpine Booth

Daihatsu Autonomous Driving Public Transporter Icoico

Daihatsu Booth

Daihatsu Compact Minivan Waiwai

Daihatsu Copen Gr Sport 2

Daihatsu Copen Gr Sport

Daihatsu Next Gen Kei Truck Tsumutsumu

Daihatsu Next Gen Suv Wakuwaku

E Apple Prod By Jiyuan 2

E Apple Prod By Jiyuan

Fuso Aeroqueen

Fuso Booth

Hino Booth

Hino Dakar Rally Race Truck

Hino Flatformer Booth

Hino Flatformer Concept

Hino Flatformer

Hino Flatformer Li Ion Battery

Hino Gh11

Hino Gh8

Honda Booth

Honda Cb 2

Honda Cb History Theater

Honda Cb

Honda E500

Honda E500 Lifestyle

Hondae

Honda Nbox

Honda Nsx

Isuzu Booth

Isuzu Elf Ev2

Isuzu Elf Ev3

Isuzu Elf Ev4

Isuzu Elf Ev

Isuzu Erga Duo Hybrid

Isuzu Future Logistics Intelligent Relay 2

Isuzu Future Logistics Intelligent Relay

Japia Booth

Jtekt Skelton Mechanical Working Sample 2

Jtekt Skelton Mechanical Working Sample 3

Jtekt Skelton Mechanical Working Sample

Kawasaki Booth

Kawasaki Teryx Krx 1000 2

Kawasaki Teryx Krx 1000

Kids Event

Koito Booth

Marelli Booth

Marelli Inverter

Marelli Motor Installed For Nissan Leaf

Mazda Kids Event

Ministry Of Environment Nano Cellulose Vehicle 2

Ministry Of Environment Nano Cellulose Vehicle 3

Ministry Of Environment Nano Cellulose Vehicle

Ministry Of Environment Super Energy Saving Vehicle 2

Ministry Of Environment Super Energy Saving Vehicle

Mitsubishi Delicads

Mitsubishi Eclipse

Mitsubishi Engelberg

Mitsubishi Rvr

Ngkntk Booth

Nissan Fairladyz 2

Nissan Fairladyz

Nissan Gtr

Nissan Leaf Nismo

Renault Megane

Subaru Levorg Prototype

Subaru Viziv 2

Subaru Viziv

Suzuki Booth

Suzuki Jimny Cierra

Suzuki Jimny

Suzuki Outboard

Tajimaev Booth

Tajimaev E Runner Uld1

Tajimaev E Runner Ulp1

Tajimaev Tajima Jayuan Car Sharing Model

Telecommunication Company Docomo Booth

Tms2019 Place

Toyota Booth Have No Mass Production Car

Toyota Businessliner 2

Toyota Businessliner 3

Toyota Businessliner

Toyota E Care

Toyota E Palette 2

Toyota E Palette

Toyota E Racer

Toyota Pmcv Concept

Udtrucks Booth

Yamaha Booth

Yamaha Land Link Concept

Yamaha Mw Vision 2

Yamaha Mw Vision 3

Yamaha Mw Vision

Yamaha Tri Town 2

Yamaha Tri Town

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