This week's special blog series has focused on auto markets, a critical source of chemical demand. Today, it concludes by summarising developments in China, USA, EU, which account for ~55% of global sales.
They have moved in different directions since the Great Recession began:
• China's volumes soared in 2009-10
• The USA has fallen ~30% from 1995-2007 sales levels
• The EU was more stable, but seems now to be weakening
Overall, however, sales were stable in 2008-9 at 34.8m (purple, blue lines), and then rose 9% in 2010 to 37.8m (brown line).
The 2010 increase was entirely due to China, which was up 3m. The USA/EU were unchanged at a combined total of 24.5m. 2011 (red square) then saw a strong start in Q1 in all 3 regions, with sales up 12% versus 2010. But Q2 has been disappointing, with overall sales up just 2%.
Q3 may not show much improvement. Japan's production is recovering, as is component availability for non-Japanese auto manufacturers. But consumers in all 3 areas seem worried by rising food and commodity prices, and new government stimulus programmes are unlikely.
Those companies with major dependencies on auto sales will clearly want to make contingency plans now, as there is clearly a real risk we will face a disappointing end to the year.