The threat to consumer confidence posed by a looming war in Iraq appears set to knock the recovery of the automotive market off course, according to a report issued by the London-based World Markets Research Centre (WMRC). The report concludes that a return to grobal auto market growth is not expected until 2004.
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WMRC says that the global car and commercial vehicle markets are set to reverse marginal growth achieved last year, declining by 1.8% and 0.5% to 36.6 million units and 18.1 million units respectively in 2003.
According to WMRC’s analysis, vehicle demand is set to fall in NAFTA and Western Europe by 3% and 4.3% respectively as markets fall below recent peak levels and the sales-incentive boosting effect begins to wane amidst the uncertain global economic climate.
WMRC says that the emerging markets of Asia-Pacific and Central and Eastern Europe will be the only regions to report significant growth – around 3.4% – in 2003. WMRC adds that China is to confirm its arrival as an auto superpower in 2003 by overtaking Germany to become the world’s third largest auto market behind the US and Japan.
Commenting on the results, Lee Peart, senior automotive research analyst at WMRC, said, “Fears of a looming conflict between the US and Iraq are set to damage the already fragile recovery currently under way in the global automotive market. Global vehicle demand is forecast to decline by 1.4% this year to 54.6m units, reversing the 0.9% marginal growth recorded in 2002.”
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