We take a closer look at the current state of PM’s largest consumer, the automotive industry
With around 80% of all powder metallurgy (PM) structural parts finding their way into cars and vans any set backs in automobile production or sales as experienced in the sharp economic downturn in 2009, are quickly felt by the PM part producing communities around the world.
Thanks to numerous incentives such as the ‘cash for clunkers’ introduced in the USA and other countries in the second half of 2009, the automotive sector has seen a sharp revival in its fortunes especially in the first half of 2010.
Growth in Asia
Japan saw car/van production soar by 45.8% in H1 of 2010 to reach 4.842 million compared with the same period in 2009. ‘Small’ cars (less than 2000cc) output increased by 22.5% to 1.117 million whilst ‘standard’ cars (>2000cc) jumped by 85.4% to 2.404 million. Vehicle sales in Japan in the January – July 2010 period increased by 20% to 3.100 million.
South Korea continues to increase its share of global car production taking a 5.7% market share in 2009 with a total of 3.573 million units. Riding on the exports hike, auto production in July 2010 climbed 21.7% from the corresponding month of 2009 to 377,585 units, posting the ninth month of growth in succession. Production for the first seven months in 2010 achieved 2,477 million units, up 34.6% over a year before.
India recently reported production of 2.918 million cars and vans (2009-2010) and over 11 million 2 and 3 wheeler motor cycles. The Southeast Asia Nations (ASEAN) are forecasting car sales to exceed 2 million in 2010. Malaysia, Indonesia and Thailand have car production and assembly plants.
European production picking up
According to ACEA (Brussels) new passenger car production in the European Union (EU) rebounded by 34% in the 1st quarter 2010 compared to the same period in 2009 but production was still down 13% on the 2008 period. In terms of units produced, Germany remained the largest auto manufacturing country in the EU (1.4 million units +33%) while the UK saw its car production pick up most (+72%).
Following a strong resurgence in Q1, April and May car sales in Western Europe slipped by 7.4% and 9.3% respectively. 7,285 million new cars were registered in the period January to June 2010, or 0.2% more than over the same period a year ago. Looking at the main markets, only Germany contracted (-28.7%), while Italy (+2.9%), France (+5.4%), the UK (+19.9%) and Spain (+39.5%) all posted growth. July saw car sales fall by a 16.5% reflecting the end of government car scrappage schemes as well as continuing challenging economic conditions. Eastern Europe has fared somewhat better and Russian car sales are reported to be up by 50% in the first 7 months of 2010.
US reports 64% increase in production
In North America, US light vehicle production in the period January to July 2010 reached 4.311 million units of which 2.701 million units were cars. This is an increase of 64.5% over the same period in 2009. In the first 7 months of 2010 overall vehicle sales were up 14.7% at 6.650 million compared with 2009. Imported Japanese and Korean cars continued to make inroads in their market share of cars and light vehicles. Canada and Mexico also recorded gains in sales in the first 7 months of 2010 but not on the scale of the USA.
In South America, demand for cars and light trucks in Brazil has increased by 17% to 1.639 million units in H1 of 2010. Combined Brazil and Argentina automotive sales in the first 7 months of 2010 increased by 13.7% to 2.229 million units compared with the same period in 2009.
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