Western consumers cut back spending

Chemical companies, Consumer demand, Economic growth

EU autosNov10.pngAll is clearly not well with the Western consumer. The stimulus programmes have not given them renewed confidence about the future. Instead, they are focused on the prospect of higher taxes and rising unemployment.

Two examples make this mood change very clear:

• As the above slide shows, EU auto sales are falling off the charts. They were down 17% (red line) in October, normally a strong month. Equally concerning were the massive declines in the 5 major markets: France down 19%, Germany down 20%, UK down 22%, Italy down 29% and Spain down 38%.

• In the USA, Wal-Mart, the world’s largest retailer, saw its same-store sales fall for a 6th consecutive quarter, down 1.3%. This is unprecedented. In response it is launching what promises to be a bitter price war, declaring that it intends to “be the price leader this holiday season”. Similarly, US housing starts fell to just 519k, back to April 2009 levels, in spite of record low interest rates.

The blog fears that the consensus Base Case Scenario for 2011 is already starting to look quite optimistic. If it was still running a major business, it would be strongly tempted to revisit the Downside Scenario outlined last month in its Budget Outlook, and re-check how this might impact expected performance.

PREVIOUS POST

Pressure mounts on US Fed's QE2 Lifeboat

17/11/2010

The US Fed’s new QE2 Lifeboat programme designed to raise asset prices got...

Learn more
NEXT POST

Malaysia launches world's first 4G service

20/11/2010

A decade ago, the blog was one of the pioneers of eBusiness as ChemConnect’...

Learn more
More posts
Chemical industry has key role in helping to create a more sustainable world
20/09/2020

The chemical industry has a critical role to play in enabling the world to “build back better&...

Read
The state of the global economy in 2020
13/09/2020

Last Wednesday, I gave the opening presentation for the ICIS PET Conference and looked at whether th...

Read
Reality dawns for business as No Deal Brexit approaches
06/09/2020

I warned before the June 2016 Brexit referendum that Brexit was all about politics, and Boris Johnso...

Read
Local circular plastics solutions to replace mega projects business model
30/08/2020

NEW YORK (ICIS)–There will be a paradigm shift away from mega crackers producing massive volum...

Read
Global chemical industry – key trends for success in today’s New Normal
02/08/2020

The chemical industry is the best leading indicator for the global economy. On Friday, I had the pri...

Read
Oil prices signal potential end to the V-shaped recovery myth
26/07/2020

Oil prices have moved into another ‘flag shape’ – which previously provided critic...

Read
Bankruptcies now the key risk as hopes for V-shaped recovery disappear
19/07/2020

Governments, financial markets and central banks all originally assumed the Covid-19 pandemic would ...

Read
Reshoring set to create Winners and Losers as advanced manufacturing takes over
12/07/2020

Not many companies still operate in the same way as 500 years ago, or even 50 years ago. But in manu...

Read

Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more

Analytics

Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more