Over the years, carmakers have been sandwiched between demands for price reductions from customers and soaring gasoline and material costs. The mounting cost pressure forces them to gain components from offshore manufacturers, which has been reshaping the global landscape of auto parts sourcing. Automotive parts are indispensable to fundamental maintenance of the car while accessories are products not necessary for repair or maintenance, but to enhance the comfort and aesthetic of the car according to car-owner¡¦s likes.
Europe Automotive: A Continuing Battle
IndustryWire via NewsEdge Corporation:
The automotive industry is not the power in Europe that it once was. At its peak, the makers of cars, buses and lorries plus the manufacturers of engine and body parts had so much industrial and economic muscle - since they were so important for the economy and employed so many people - that they could dictate terms to national governments. That is no longer the case, though the carmakers still retain a significant role in several national economies. The balance of power has shifted. Economies are more diversified and national governments are less dependent on their particular national champions. In a global market, European carmakers face competition from rival brands. The automotive industry¡¦s economic impact still matters - and Gunter Verheugen, the European commissioner for enterprise and industry, launched the CARS 21 initiative in 2005 with the aim of maintaining the competitiveness of European firms¡K
U.S Carmakers to Seek Labor Cost Cuts
AP Online via NewsEdge Corporation:
Contract talks between the U.S.-based automakers and the United Auto Workers formally begin in July, but the key issue is already clear: Eliminating the roughly $25-an-hour labor cost gap between Detroit and its Japanese rivals. Officials at General Motors, Ford and Chrysler said that reducing labor costs to the level paid by Toyota Motor Corp. and Honda Motor Co. Detroit's prime competitors will be the top priority. Industry analysts say that survival of the three U.S. companies is at stake. The three automakers based near Detroit generally pay about 30 percent more per hour in wage, pension and health care costs than Japanese automakers. And nowhere is it more critical than at Ford Motor Co., which lost $12.7 billion last year and has mortgaged its assets to fund a turnaround plan that includes thousands of job cuts to shrink itself to match lower demand for its products¡K
China to Become Biggest Automaker in 2010
SinoCast China Transportation Watch via NewsEdge Corporation:
China's 14 well-known automotive manufacturers plan to turn out 16 million vehicles in 2010, 2.5 times as many as they did in 2006. China, if the plan came true, will outpace Japan and the US and become the biggest auto producer around the globe. As the current No. 3 producer worldwide, it has achieved a yearly growth of 20 percent in recent years while the bigger players like Japan and the US have had unstable productions. For the moment, they Japan and the US have gained an approximate production of 11 million units each. The 14 Chinese automakers have manufactured nearly 90 percent of the nation's total turnout, and most of their products have been made under the foreign brands in partnership with companies from the US, Japan, South Korean, and Europe¡K
Russia: Automotive Forecast
Total passenger car ownership, at an estimated 178 per 1,000 population in 2006, is more than double that of a decade ago. It is, however, still far below the 400-500 per 1,000 population common in developed countries, and around half the levels in the central European economies in transition¡Xalthough it is higher than in many emerging markets in Asia and Latin America, some of which are richer. More than one-third of the cars on the road in Russia are foreign, in part thanks to second-hand sales. Recent growth in sales, especially of foreign-made cars, has been very strong. Rising incomes, the development of consumer credit and tax reforms have boosted sales. The latter are estimated to have increased by 20% in 2006 to 2.06m cars. In US dollar terms the market was worth some US$34bn in 2006¡X36% higher than in 2005. Spending on new foreign cars (both imported and domestically produced) increased by more than 60% in 2006 to US$25bn¡K
Korean Makers Increase Auto Sales 8.1% in 1st Half
Korea Times via NewsEdge Corporation:
South Korea's five automakers have achieved ¡§considerably good mark¡¨ during the first half of this year despite stronger Korean currency, soaring oil prices, poor domestic consumption and ever-growing competitiveness. The automakers sold a total of 2,605,101 vehicles, excluding exports in knockdown (KD) formula, from January through June, up 8.1% from 2,409,385 units a year earlier. The total sales break down to 595,341 unit sold at domestic market and 2,009,787 units in exports. GM Daewoo marked a 32.8% gain during the first half from a year earlier, the largest growth, followed by Renault-Samsung with 9.2%, Ssangyong 7.7%, Hyundai Motor 3.7% and Kia Motors Corp. with 2.8 % jump. GM Daewoo and Renault-Samsung have seen the highest performance since their inception¡K
China Imported USD7bn Auto Parts in H1
SinoCast China Business Daily News via NewsEdge Corporation:
China's imports of engines, automotive components & parts and other automotive goods kept a stable growth generally in the first half of this year, with the total value leapfrogging USD 7 billion, in accordance with the statistics of China Association of Automobile Manufacturers. The imports of engines, automotive components & parts and other automotive goods all kept increasing in the six-month period, and the imports of engines even rose by 16.43% from a year-ago period to USD 697 million. Besides, the import value of automotive components & parts, accessories and bodies reached USD 6.124 billion with a year-on-year growth of 14.33% and the import value of automobiles and motorcycles' tyres added to USD 94 million with a rise of 20.36%. Meanwhile, the import of some key automotive parts still greatly soared. For instance, the import value of safety air bags, gearboxes, driving axles and vibration dampers climbed by 120%, 66.09%, 180% and 220% from the corresponding period of a year earlier to USD 165 million, USD 1.461 billion, USD 52 million and USD 95 million respectively.
India Auto Parts Industry Outlook
India Business Insight via NewsEdge Corporation:
The auto components industry in India is worth $10 billion and employs 2.8 lakh people. The Indian auto components industry has 500 key manufacturers, who account for 85 percent of the production in India. More than half of these units are in the small and medium segment. The manufacturing costs in India are 30 percent lower than in Western countries. According to the Auto Components Manufacturers Association (ACMA) and McKinsey, the domestic demand for components in India will rise to $20-25 billion in 2015 from $1.4 billion in 2005, making the Indian auto components industry worth $40-45 billion. India exported Rs81 billion worth of auto components in 2005-2006. Imports were worth Rs87 billion. Imports from China, which were worth Rs5,080 million in 2005-2006, are expected to reach Rs11,176 million in 2006-2007.
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