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Month-on-month growth in automotive industry

Quick poll: When do you think the automotive industry will begin to see month-on-month growth again?

 

Jerker Adeberg, Executive Vice-President, Luvata Rolled Products division:

Personally I believe that the turning point will be in the end part of this year or early next year due to a number of things.

There is a large stock of cars in the pipelines of the Japanese, American and European manufacturers. Customer demand and optimism have not yet returned we have presently too few positive indicators in the western world to drive that optimism at the moment.

As a company delivering to the automotive industry, we see very few positive demand indicators at the moment. When we start to see consumer activity return, it will most likely take 3-6 months for manufacture to ramp up again while the back-log of stock is cleared.

The poll is interesting.

The 27% of voters for late 2009 are most likely referring to an increased production in the Asian region where the recession has not hit that hard and large local markets like China and India drive demand. The over-capacity and industrial downfall is also less in Asia where the mental consumer attitude is more positive and quicker to react.

The 27% “first half 2010” believers are probably referring to the small positive signs of the American industry and the heavy financial packages that are injected in the World industry as well as the German €2.500-per-car scrapping incentives.

The 20% Second halfers of 2010 are most likely to be Europeans dragged down by the BPPPs (Black & Pessimistic Picture Painters) that believe that the World will not come back until 2011 or later. Yes, we have the worst recession since 1930 but also good news travels fast in todays IT world - so we will see automotive production return quicker than that.

 



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