The global automotive industry is likely to report modest signs of improvement in 2013. Industry analysts expect car registrations to rise by 5.1% along the year. About 43% of the worldwide pie is projected to go to Asia. The most significant growth is expected to come from India and China. The main factor for the auto industry positive prospects in these countries is the rapid growth of middle income population.
At the same time, researches also reveal something different. The continuous automotive investments in the Chinese market are likely to create overcapacity in the near future. Consecutively, manufacturers will have to withstand massive margin sacrifices. Yet, the automotive industry is struggling to prevent these developments. Chinese auto-builders are tapping other markets by diversifying their operations.
The European crisis situation is named as the main driver of the global automotive industry. Actually, it really affected car sales volume. Car sales in the Euro Zone dropped for the fifth consecutive year in a row. Volumes fell from 13.6 million in 2011 to only 12.5 million in 2012. The Chinese market performance was on the contrary. China recorded a significant turnaround in its fortunes by registering 13.2 million cars in 2012.
In 2013, China is expected to produce 19.6 million cars and LCVs. At same time, Europe is to manufacture 18.3 million vehicles. Therefore China will grow to take 23.8% share of the global automotive market this year. Back in 2000, the country took only 3.5% of the worldwide car market. Over the same period the European share contracted horribly. From 35% in 2001, a record low level of 20% share is expected in 2013 for Europe.
In terms of sales, the US automotive industry dropped its capacity during 2008-2009 financial crisis. Despite the contraction, the country keeps its unbeatable position. Last year the US sales rose by 13.4% to the five-year high of 14.5 million cars. This year, the US market is also expected to grow with an 18.2% share of the global total. This growth is driven by rising vehicle sales and falling number of outlets. In 2012, car dealers sold on average 812 vehicles. Currently developers like Hyundai and Volkswagen are trying to infiltrate the US market. That pushes projected average vehicles sales to reach 850 in 2013.
As a major automotive trade and re-export hub for the wide Middle East region, Dubai is gaining a momentum. That is due to its inherent logistical and geographical advantages. In respect many worldwide automotive aftermarket majors look to the Emirate as a key access point to an ever-growing Middle Eastern auto market. Re-exports to countries in the GCC, Levant, Central and South Asia and North and East Africa form a significant part of the automotive aftermarket trade through Dubai.
