While America Slept. Thursday, January 1, 2009
December possibly below 10m. Edmunds.com predicts the annually adjusted sales rate of light vehicles in the U.S. to come in at 9.8 million for December. J.D. Power and Associates now expects 10 million. The rate was 10.3 million in November. Sales results will be announced Monday, Jan. 5.
China expects 9.4m units for 2009: China’s total vehicle sales are expected to reach 9.41 million units for the full year of 2009, according to a State Information Center’s forecast, says Gasgoo. China’s GDP growth next year is expected to remain above 8 percent and its car market should see similar growth, says the forecast. Something is screwy about those numbers. January through November, China’s total vehicle sales were 8.63m. December is usually a strong month in China. The end of year number for 2008 (which is not out yet) is expected to be in the low 9m. If that’s true, then the forecast would not reflect increases in-line with expected GDP growth.
Japanese companies haven’t given up on BRIC: Actually, “Japanese companies remain steadfast in their belief that such emerging markets as China, India and Brazil will continue to provide opportunities for business and earnings growth in the new year,” the Nikkei (sub.) Ah! They’ve given up on Russia, reducing BRIC to BIC. The Nikkei sees an 8 percent GDP growth in China. “In Brazil, a growing middle class has helped fuel demand for Japanese autos and motorcycles.” In India, “economic growth has consistently come in at an annualized 7-8 percent,” and the Nikkei expects this to continue.” Says the Nikkei: “China, India, and Brazil have a combined population of roughly 2.7 billion, or about triple the total for Japan, the U.S. and the European Union. For many Japanese companies, the emerging markets will continue to offer attractive opportunities.” They definitely gave up on Russia.
Stick and carrots for Beijing’s emission-oinkers: Beijing will ban heavy-polluting vehicles from running on its inner-city roads starting Jan. 1, 2009. They will phase them out by the second half of next year by providing subsidies to their owners for buying low-emission new cars, reports Gasgoo. The maximum subsidy for scrapping a polluting car for a clean one will reach $3,660. Heavy polluters are issued a yellow license plate. Beijing has 353,800 yellow-plate vehicles. They account for 10 percent of the total number of motor vehicles, and for 50 percent of the emissions.
Ford Credit stops loans to Chinese dealers, consumers: Ford dealers were informed on Dec. 30 that floorplan loans to dealers and credit to consumers will be suspended, Gasgoo writes. All of the brands within the company’s portfolio, involving Volvo, are affected. Ford’s finance arm had started to offer loans to Chinese dealers and consumers through Ford Automotive Finance (China) Limited (FAFC) in mid-2005.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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"China’s GDP growth next year is expected to remain above 8 percent and its car market should see similar growth, says the forecast. Something is screwy about those numbers." I am beginning to think that Bernie Madoff runs China's economic statistics department.
Chinese numbers are notoriously unreliable. It's a big country with lots of people. Also note that "vehicles" in China means anything with an engine and more than two wheels, from tricycles (of which there are approximately 15m on the road) all the way to semis. There is no such thing as a "light vehicle" count.