LMC Automotive Global Light Vehicle Sales Update (March2017)

2017/04/19

Summary

  • Global Light Vehicle sales grew once again in year-on-year (YoY) terms, up 5.0% for March. The selling rate eased back from the February result (of 96 mn units/year), to 94 mn units/year for the latest month.
  • March saw the selling rates of two key markets, China and the US, ease back. Western Europe’s solid momentum was maintained, while Russia and Brazil showed some, modest, improvement.



North America

  • March 2017 US Light Vehicle sales totalled 1,554,000 units, which translated into a selling rate of 16.6 mn units/year. While macroeconomic conditions are favourable, with low interest rates, high consumer confidence, low and stable fuel prices, and low unemployment, there are some factors holding back the market total. Fleet sales were not as heavily emphasised in March as they were in February to reduce inventory levels. Used-car sales continue to grow as the price-gap between new and used vehicles widens. Meanwhile, default rates on sub-prime loans are on the rise, approaching 2007-2009 levels.
  • Canadian Light Vehicle sales for March neared 188,000 units, representing a 7.0% increase YoY and setting a new March record.

Europe

  • West European Light Vehicle registrations improved once again in March. With many markets enjoying one or two extra selling days in the month, results compared favourably YoY (+9.6%). The selling rate stood at 16.5 mn units/year, highlighting the ongoing strength of the market as it continues to move back towards pre-financial crisis levels. The latest results support the positive news that we have seen from the wider economy recently, through lower unemployment rates and improved consumer confidence.
  • Russian Light Vehicle sales picked up well in March, growing 9% YoY, with the selling rate reaching 1.6 mn units/year. Overall, Eastern Europe was up 7.2%, with other strong markets last month including the Czech Republic and Poland.

China

  • Advance data indicates that China’s March selling rate was 26.7 mn units/year, down 8% from the holiday-adjusted February. In Q1 2017, the selling rate averaged 27.9 mn units/year, which was a slowdown from 30.6 mn units/year in Q4 2016, and a touch below total Light Vehicle sales of 28.0 mn units in 2016. Yet, on a year-on-year basis, sales increased by nearly 6% in Q1 2017, despite the higher tax rate for vehicles with smaller engines and an uncertain economic outlook.
  • Last month, China’s central bank followed the US Federal Reserve by lifting domestic money market rates in an effort to curb capital outflows. In addition, Beijing launched another round of lending and purchasing restrictions on real estate in order to cool the overheating property market. Such moves should eventually impact credit growth, consumer spending and vehicle sales.

Other Asia

  • In Japan, the March selling rate was a solid 5.1 mn units/year, up 1% from February. On a year-on-year basis, sales increased by a strong 9.4% in March. After two years of decline, sales (in particular, Light Commercial Vehicle sales) are finally gaining some momentum, helped by improved business confidence due to a weaker yen.
  • The South Korean market maintained a robust pace, despite political uncertainty in the wake of the impeachment of the president and rising military tensions with North Korea. The selling rate reached a strong 1.9 mn units in March for the second consecutive month, supported by the ongoing scrappage incentive scheme for old diesel vehicles.

South America

  • After a dismal start to the New Year, the Brazilian market picked up in March, with the selling rate rising to a 19-month high of 2.3 mn units/year. On a year-on-year basis, sales increased by 6.4% in March, the first increase since December 2014. Yet, it is too early to declare a recovery, as the job market is continuing to deteriorate and credit conditions remain tight.
  • In Argentina, despite the ongoing fiscal austerity measures, the selling rate surged to 900,000 units/year in March, the highest rate since December 2013. The recovery of the market appears to be gaining momentum, supported by easing credit conditions, the stabilized peso and the bullish run on the stock market.

 

Sales (units) Selling rate (Units/year)
Mar
2017
Mar
2016
Percent Change Year to date
2017
Year to date
2016
Percent Change Mar
2017
Year to date
2017
Year
2016
Percent Change
WORLD
9,291,550
8,847,595
5.0%
23,747,015
22,568,355
5.2%
94,027,346
94,798,750
93,336,274
1.6%
USA
1,553,936
1,594,946
-2.6%
4,026,165
4,083,044
-1.4%
16,550,513
17,193,445
17,538,559
-2.0%
CANADA
187,540
175,198
7.0%
421,440
402,831
4.6%
2,137,013
2,068,427
1,947,684
6.2%
WESTERN EUROPE
2,014,763
1,838,630
9.6%
4,405,225
4,104,104
7.3%
16,499,870
16,479,923
15,770,677
4.5%
EASTERN EUROPE
363,132
338,857
7.2%
870,993
831,045
4.8%
4,220,298
4,188,037
3,900,884
7.4%
JAPAN
684,462
625,932
9.4%
1,561,205
1,451,028
7.6%
5,119,270
5,078,657
4,903,736
3.6%
KOREA
165,610
170,208
-2.7%
419,333
415,056
1.0%
1,909,449
1,801,384
1,783,990
1.0%
CHINA
2,487,936
2,427,959
2.5%
6,923,997
6,561,354
5.5%
26,659,003
27,890,750
28,021,288
-0.5%
BRAZIL / ARGENTINA
257,989
227,446
13.4%
680,696
619,792
9.8%
3,195,988
2,856,002
2,662,121
7.3%
OTHER
1,576,182
1,448,419
8.8%
4,437,962
4,100,101
8.2%
17,735,942
17,242,123
16,807,335
2.6%
Notes: The percentage change in the final column compares the average selling rate in the year-to-date with the last full year.
Late reporting countries and estimates are included in "Other".
Eastern Europe includes Turkey.
China includes estimate of light vehicle imports.

For further information or inquiries for forecast data, please refer to LMC Automotive's products.