Trends in the passenger car markets
We expect trends in the passenger car markets in the individual regions to be mixed in 2017. Overall, growth in global demand for new vehicles will probably be slower than in the reporting period.
The Volkswagen Group is well positioned to deal with the mixed developments in automotive markets around the world. Our broad, selectively expanded product range featuring the latest generation of engines as well as a variety of alternative drives puts us in a good position globally compared with our competitors. Our goal is to offer all customers the mobility and innovations they need, sustainably strengthening our competitive position in the process.
We estimate that demand for passenger cars worldwide will continue to increase in the period 2018 to 2021.
For 2017, we anticipate that unit sales volumes in Western Europe will fall somewhat short of the level seen in the reporting period. Pre-crisis levels are not expected to be reached, even in the medium term. The continuing uncertainty among consumers precipitated by the debt crisis is likely to be exacerbated by the uncertain outcome of the Brexit negotiations between the EU and the UK, putting a damper on demand. In Italy and Spain, the recovery will probably continue in 2017 but at a much slower pace; for France, we expect growth to be only slightly positive. We anticipate that the market volume in the United Kingdom will be considerably lower than the high level seen in the previous year.
In the Central and Eastern European markets, demand for passenger cars in 2017 should exceed the weak prior-year figure. Following significant declines in some of the previous years, the volume of demand in Russia is estimated to increase moderately. We expect to see further growth in demand in the Central European markets.
We are projecting that the volume of demand in the South African passenger car market in 2017 will be up slightly year-on-year.
Following the positive trend of recent years, we forecast that the volume of the German passenger car market in 2017 will be slightly lower than in the previous year.
We expect that the market volume for passenger cars and light commercial vehicles (up to 6.35 tonnes) in North America as a whole and in the USA will be a little lower in 2017 than in the prior year. Demand will probably remain highest for models in the SUV, pickup and van segments. In the Canadian market, the number of new registrations is likely to be slightly below the previous year’s high level as well. This stands in contrast to Mexico, where we anticipate that demand will be noticeably higher than in the reporting period.
Owing to their dependence on demand for raw materials, the South American markets for passenger cars and light commercial vehicles are heavily influenced by developments in the global economy. Protectionist tendencies are adversely affecting the performance of the region’s vehicle markets, especially in Brazil and Argentina, which have imposed restrictions on vehicle imports. Nevertheless, compared with the previous year, demand in the South American markets as a whole will probably edge up in 2017. In Brazil, the largest market in South America, the volume is expected to rise moderately following substantial losses in the previous years. We anticipate that volumes in the Argentinian market in 2017 will be up slightly year-on-year.
The passenger car markets in the Asia-Pacific region look set to continue their growth trajectory in 2017, however at a weaker pace. In China, the steady increase in individual mobility requirements will push up demand, though the rate of growth is likely to be slower than in the previous year because the tax break for vehicles with engine sizes of up to 1.6 l was reduced by half at the end of 2016. Strong demand is still forecast for attractively priced entry-level models in the SUV segment in particular. In India, we expect demand for passenger cars to slightly exceed the previous year. We believe that demand in the Japanese passenger car market will continue to taper off in 2017.