NAFTA Automotive Outlook: Focus Mexico

Transcription

1 NAFTA Automotive Outlook: Focus Mexico UDEM April 2013

2 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook Mexico Production Summary

3 Annual real GDP growth in % World economic growth Modest gains expected; significant threats remain World average Political stalemate may cause US recession Debt crisis continues Hard landing averted? -6-8 World United States Japan Eurozone Brazil Russia India China Source: IHS DataInsight

4 Jan'07 Jan'08 Jan'09 Jan'10 Jan'11 Jan'12 Jan'13 Seasonally adjusted selling rates Indexed 2007=1 Light vehicle selling rates Western and Central Europe still lag rest of world 2.4 ASEAN C Europe E Europe GC Gr China India Japan Korea N America S America W Europe 1.8 IN sales level Lehman Bros. collapse AS SA EE JK NA WE CE Source: IHS Automotive analysis

5 m LV sales in millions 30.6 m Global light vehicle sales outlook Long-term sales developments by major region Others BRIC m 14.6m 15.6 million in million in 2020 Japan/ Korea Western Europe US Source: IHS AutoInsight

6 South America Greater China Indian Subcontinent ASEAN Middle East/ Africa East Europe North America Central Europe Oceania West Europe Japan/ Korea Pessimistic contingency Change in sales from base forecast Contingency risk: sales regions Fast-growing regions have largest downside potential 0% Pessimistic total volume change in % -4% -6% -8% -10% -12% -14% World average -16% -18%

7 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook Mexico Summary

8 Sales in millions Global light vehicle sales outlook sales volume , ,000 26, , , million -478, , million million 79.5 million % Greater China North America Japan/ Korea South Asia South America Central/ East Europe Middle East/ Africa West Europe 2013

9 Sales in millions Global sales Feb 2013 YTD Global sales 16% 14% 12% 10% 8% 6% 4% 2% 0% -2% -4% Change In February 2013, global demand slipped 2.9% year-over-year (y/y), but most of the decline relates to comparative seasonality issues relating to the lunar new year in China. From January to February 2013, global light vehicle sales grew an estimated 3.2% y/y. Gains in North America, South Asia, China, and Eastern Europe have helped to fend off the negativity elsewhere in the world. The light vehicle demand picture continues to be mixed, although bright spots remain, and for 2013, we have penciled in million units, a gain of 3.1%. Year-on-year changes

10 Trend-cycle production SAAR in millions Regional and global production SAAR rates Jan 2010 Europe supported by luxury exports Tsunami and earthquake in Japan disrupt production Apr 2010 Jul 2010 Oct 2010 Jan 2011 Apr 2011 Jul 2011 Oct 2011 Jan 2012 Apr 2012 Jul 2012 Economic uncertainty slows growth Oct 2012 North America stabilizes North America Europe China Japan/Korea Global Jan 2013 Apr 2013 Jul 2013 Oct Trend-cycle global production SAAR in millions

11 Production in millions Global production % 90 25% % 15% 10% 5% 0% -5% Year-on-year change 10-10% Feb % YTD Global production Change The full-year outlook for 2013 is 83.2 million units, up 2.1% compared with Output from Japan/Korea and China is boosted this month to give an additional 400, ,000 units. In Japan/Korea, it stems from product-cycle adjustments, while China gains both domestically and from exports. Despite the positive adjustment in Japan/Korea, the region along with Europe will see output decline this year. The balance of Asia is positive, North America looks stable, and South America is supported by low inventories; MEA remains a risk.

12 Millions Global Light Vehicle Production Near-Term Volatility, Long-Term Growth Trajectory Global Growth Rates Global Markets 3.8% Developing Markets 5.8% Developed Markets 1.5% 58% Developing Regions 20 0 Other ASEAN S AM India C/E EU China Japan/Kor W EU N AM Source: IHS Automotive Light Vehicle Production Forecast 12

13 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook The rest of the world Questions and answers

14 Feb'08 May'08 Aug'08 Nov'08 Feb'09 May'09 Aug'09 Nov'09 Feb'10 May'10 Aug'10 Nov'10 Feb'11 May'11 Aug'11 Nov'11 Feb'12 May'12 Aug'12 Nov'12 Feb'13 Long-term bond yields (in percent) Euro crisis: Long-term bond yields ECB action easing fears; Cyprus may be trouble Breaking point threshold The cause of the current euro crisis Italy France United States Germany Spain Source: IHS DataInsight

15 Feb-03 Aug-03 Feb-04 Aug-04 Feb-05 Aug-05 Feb-06 Aug-06 Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10 Aug-10 Feb-11 Aug-11 Feb-12 Aug-12 Feb-13 Light vehicle sales SAAR (monthly data, annualized) European light vehicle sales Still trending down Where is the bottom? Pent-up demand across the EU climbs every day but sales keep falling 16,000 15,000 14,000 13,000 12,000 11,000 10,000 Source: IHS AutoInsight

16 Sales in millions Europe sales outlook 25 Central Europe East Europe West Europe Change 6% % 2% 0% -2% -4% -6% Year-on-year changes Feb 2013 YTD % In February 2013, European sales reached 1.22 million units, down 6.7% versus February This result remains in line with the trend that was valid for most of Once again, Western Europe suffered heavy declines (down 10.7%), whereas Central and Eastern Europe fared much better (up 4.6%). Nevertheless, even this side of the continent has been experiencing a clear deceleration lately related to the cooling off in the Russian market. For the near future, we expect the situation to remain bleak: following the 2012 decline, full-year 2013 should keep pointing down, not reaching the 18.0-million-units threshold.

17 Production in millions Europe production outlook 25 Central Europe East Europe West Europe Change 20% % 10% 5% 0% -5% -10% Year-on-year changes Feb 2013 YTD % European production in February 2013 is estimated to have declined 12.1%, as car manufacturers continue to align their production to a demand level that remains at the historically weak level seen in fourth-quarter The full-year 2013 European production outlook is stable compared with our last forecast, down 3.3% for the entire region, to million units. Looking at 2014, our forecast is set at million units, up 3.5% compared with 2013 but down 4.3% compared with We do not expect to see the light at the end of the tunnel before 2015, when output is expected to climb to million units.

18 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook Mexico Summary

19 Intention to Buy New Vehicle in 6 Months 5.0 (Percent Yes) Month Moving Average Actual Conference Board 19

20 New Auto Loans Delinquency Rates 4.0 (% - Accounts past due 30 days or more) Source: American Bankers Association Direct (Bank) Loans Months Indirect (Dealer) Loans 20

21 New Vehicle Buyers Average Credit Score Avg. Score Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 22% 21% 20% 19% 18% 17% 16% 15% 14% 13% 12% 11% 10% 9% 8% 7% 6% FICO SCORE % UNDER 670 Source: CNW Marketing 21

22 New Auto Loan Application Approvals 85% 80% 75% 70% 65% 60% 55% Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 Source: CNW Marketing Unweighted Average of Prime, Near and Subprime Months 22

23 120% New Auto Loan Application Approvals 100% 750 and Above 80% 60% Between 620 and % 20% 0% Credit Score less than 620 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Prime Near Prime Sub Prime Source: CNW Marketing Months 23

24 Median Age New Vehicle Buyer 53 (Years) CNW Marketing Months 24

25 New Auto Loan Rates Commercial Banks (Percent) Quarters Federal Reserve Board 25

26 Incentives to MSRP 26 (Percent) CNW Marketing Months

27 Residual Value Index 100% 90% (Index = Lease contract residual value versus CNW estimate of residual at end of lease term) 80% 70% 60% 50% 40% 30% Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 GM Ford Chrysler Industry Toyota Honda Nissan Source: CNW Marketing Months 27

28 U.S. Light Vehicle Sales Lease Penetration (Share) 29% 28% 27% 26% 25% 24% 23% 22% 21% 20% Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Source: CNW Marketing Leases by Month 28

29 U.S. Light Vehicle Inventory Units 4,500 (Units in thousands) 4,000 3,500 3,000 2,500 2,000 1, Months Seasonally Adjusted 29

30 U.S. Light Vehicle Inventory Days Supply 120 (Days Supply) Light Trucks Cars Months Seasonally Adjusted 30

31 New demographic realities lower US auto sales prospects outbound (mid term intact) 18,000,000 16,000,000 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 `04 `06 `08 `10 `12 `14 `16 `18 `20 `22 IHS2013 (March after pop downgrade) IHS2013 (Jan) Lower population has direct and indirect impacts on auto markets. Including lower overall projected growth in US economy and consumption levels Fewer than expected households especially further outbound Adjusted for car ownership propensities total effective car owning population is reduced by around 3m by 2023, Lowering required parc and thus new vehicle sales after 2019 by a figure building up to 500,000 per year Potential segment impact weaker residuals in small and mid size, and lower passenger car sales including compacts but also weaker Pick-up sales. Any less downsizing of segment mix could well mean CAFE 2025 targets will be missed by a bigger margin Source: IHS Automotive

32 United States Light Vehicle Sales, SAAR (Units in millions) Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 SUVL 32

33 13 United States Car & Truck Sales, SAAR (Units in millions) Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 CARS LT. TRUCKS 33

34 Big Three Domestic vs. Import Name Plate Car & Truck Sales, SAAR 13 (Units in millions) 12 Detroit Big Import 4 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 Months 34

35 United States Car & Truck Sales, SAAR - Asian Manufacturers 3.0 (Units in millions) Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 TOYOTA HONDA NISSAN X12A Seasonal Adjustment Months

36 United States Car & Truck Sales, SAAR 1.40 (Units in millions) Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 SUBARU MITSUBISHI MAZDA VW Group HYUNDAI/KIA X12A Seasonal Adjustment Months

37 Sales in millions United States sales outlook United States Change 16% 14% % 10% 8% 6% 4% Year-on-year changes 2 2% Feb 2013 YTD % With a seasonally adjusted average selling rate (SAAR) of million units, US light vehicle sales in February were above the 15-million-unit rate for the fourth consecutive month. At least for now, the mixture of ample inventory, targeted incentives, improving credit availability, and a continuous churn of aging vehicles needing to be replaced has outweighed potential problems facing consumers such as the expiration of payroll tax cuts and the latest round of government impasse on fiscal matters.

38 Production in millions Sales in millions South America sales and production outlook Feb Feb 2013 YTD South America YTD South America 20% 15% 10% 5% 0% -5% Change 14% 12% 10% 8% 6% 4% 2% 0% -2% -4% -6% Change Year-on-year changes Year-on-year changes Year to date, the region is experiencing pent-up demand with a 5% uptick relative to 2012, reporting 906,000 units sold. IPI hike was delayed until the end of the year. Venezuela is facing political uncertainty. Credit limits Brazil, Argentina and Colombia Full-year 2013 sales will essentially be flat. South American production reached 292,660 units in February 2013, up 1.4% versus February Brazilian output decreased 19.1% compared with January 2013, reaching 212,945 units due to lower production days and holidays. South American production volumes of 4.45 million units in 2013 and 5.23 million units in 2015.

39 Production in millions North America production Feb 2013 North America Change YTD North American output in February 2013 was flat, up just 5,800 units from year-ago levels to 1,329,648 units produced. Inventory levels at the end of February 2013 (US inventory stands at 3.23 million units) have been largely replenished since supply-chain shocks in 2011 and 2012, resulting in more limited incremental production gains in In February 2013, US production rose 1.4% to 890,005 units, up 12,354 units from year-ago levels. In 2013, US production of million units will reflect a 6% gain in production levels to support stronger sales. Forecast settings will reach 15.9 million units in 2013, rising to 16.3 million units in 2014 before breaking the 17.0-million-unit mark in % 40% 35% 30% 25% 20% 15% 10% 5% 0% Year-on-year changes

40 North American Light Vehicle Production 2013 vs OEM 2013F (000s) 2012 (000s) % Units (000s) GM 3,237 3, % 4 Ford 3,003 2, % 161 Chry/Fiat 2,457 2, % 86 Detroit 3 8,697 8, % 251 Toyota 1,782 1, % 6 Honda 1,721 1, % 45 Ren/Nissan 1,454 1, % 138 Hyundai % 8 Asian 4 5,679 5, % 197 VW % -1 BMW % -13 Daimler % -15 German 3 1,230 1, % -29 Others % 22 Total 15.9M 15.4M 2.9% ~450 Production growth rate moderates, yet recovery progresses GM Significant launch activity, including new K2XX Pickups Chrysler Fiat-based product ramps-up Nissan Migration of CUV production; Mexico expansion Transitional year prior to new program/plant launches in 2014/2015 Source: IHS Automotive Light Vehicle Production Forecast 40

41 Millions North American Light Vehicle Production Compelling Growth Prospects German Others Asian 4 Chrysler/ Fiat Ford General Motors Source: IHS Automotive Light Vehicle Production Forecast Production outlook follows demand recovery with import substitution and export activity providing additional support Most manufacturers are poised to post gains; favors OEMs with further capacity expansion plans: BMW, Hyundai, VW, Nissan, Toyota & Honda Global product/platform strategies enable competitive sourcing shifts 41

42 Exports Expansion Localization Millions Demand Environment North America Light Vehicle Sales and Production Pre-Restructuring Net Output Gain Post Restructuring NA Sales NA Production 6 From , regional sales eclipse output by 24% or 3.65 million units Gap is slashed nearly in half from , as sales outpace production by 13% or by 2.0 million units Sales growth continues yet outlook remains cautious, fails to reach historical highs Long-term output to far surpass pre-restructuring average of ~16.0 million units 42

43 North American Vehicle Exports (Millions) Production Outlook North American Produced Vehicle Exports Bolster Prospects North American Vehicle Exports by Region Europe South America Middle East/Africa Greater China Other Greater use of global platforms allows for more export ready product 40+ Free trade agreements drive Mexican output Expansion of luxury segment capability across the region into Mexico EU sovereign debt crisis tempers EU exports, yet BRIC demand grows Sourcing patterns favor NA expansion as a safe haven; with currency hedge & export prospects Source: IHS Automotive Light Vehicle Forecast 43

44 Market Dynamics Competitive Pressures Intensify with New Launch Activity 60 North American Program Launches Calendar Year Source: IHS Automotive Light Vehicle Production Forecast 44

45 Millions Production Outlook Global Output of D-/E-Segment CUVs By Region North America Japan/Korea Europe Greater China South Asia North America is the leading producer of high-margin CUVs Positioned evolved from strength in SUV category, comes full circle via global platform deployment Powertrain advances help drive role as global exporter: BRIC markets, ME/Africa, S. America, China, etc. Region holds global sourcing position for luxury & volume brands

46 Millions Production/Capacity Contributions Localization Drives Higher Regional Output Since New Plants Output: US 60%; Mexico 40% Asian 4: more than half of gains German 3: ~18% of new output Renault/Nissan VW Toyota Mazda Hyundai Honda GM Other 46

47 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook Mexico Summary

48 Mexico Light Vehicle Sales Seasonally Adjusted Annual Selling Rate - SAAR 1.3 (Units in Millions) Monthly Annual Average 0.3 1/1/1997 1/1/1999 1/1/2001 1/1/2003 1/1/2005 1/1/2007 1/1/2009 1/1/2011 1/1/

49 Monthly Sales Moving Average vs. Consumer Confidence 1200 Thousand Units Index LV Sales (left scale) Consumer Confidence 51

50 Mexico - Light Vehicle Sales 1,400,000 1,300,000 Units Used car imports and credit availability limit growth 30% 1,200,000 20% 1,100,000 10% 1,000,000 0% 900, ,000-10% 700,000-20% 600, Light Veh -L Annual Change -R -30% 52

51 Mexico Market Share 100% Percentage 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Nissan grows in coming years Others Mitsubishi Daimler Suzuki BMW Mazda Honda Toyota Ford Fiat Volkswagen General Motors Renault/Nissan

52 Millions Mexico Global Segmentation 0.60 Units A B C D E F HVAN

53 Millions Mexico Bodystyle 0.60 Units

54 Producing for Export Forecast at risk due to Brazil 4.5 Mexico Light Vehicle Production (millions of units) PROD 56

55 Mexico to Brazil ACE 55 Imports from Mexico [US$] Imports from Mexico [Units] Vehicle price per unit [US$] ,500,00 1,260,900,000 2,070,000,000 1,450,000,000 1,560,000,000 1,640,000,000 60,138 76, , , , , ,755 16,429 17,003 10,500 10,600 10,700 Very little impact YOY to 2012 figures, but we had expected K actual was 190K. Impact will be hardest for 2013 and Difficult to compete after quota is hit, so far Asians are down 20-40% 57

56 Who exports Gov Act 2012 ACT 2013 EST 2014 EST Fiat 21.90% 15.63% 21,345 22,689 23,337 Ford 14.51% 20.01% 27,324 17,098 19,762 General Motors 10.82% 7.93% 10,829 26,376 30,385 Honda 17.15% 8.03% 10,964 13,405 14,356 Renault/Nissan 23.75% 36.67% 50,067 50,298 25,292 Volkswagen 11.87% 11.73% 16,012 22,011 29,161 Distribution is in flux based upon ramp up of product by OEMs in Brazil 58

57 Mexico Light Vehicle Production By OEM 1,000, , , , , , , , , ,000 Units 0 Renault/Nissan Volkswagen General Motors Fiat Ford Honda Toyota Mazda

58 Agenda Macroeconomic outlook Global sales and production outlook Europe outlook Americas outlook Mexico Summary

59 Bottom Line With the exception of Western Europe, global demand will continue to gather momentum The US has turned the corner, promising outlook for sales and production Risks are still out there for US and EU Mexican demand has broken the million unit mark! Mexico has to explore new opportunities given this scenario, South America presents great potential Production is promising but big uncertainties lie in the future

60 Thank you for your participation! April 2013 Guido Vildozo Manager, Latin America Vehicle Sales Forecasts

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