automotive risks in the changing automotive landscapecdn.ihs.com/www/pdf/20170308-langley_ed.pdf ·...

© 2017 IHS Markit© 2017 IHS Markit. All Rights Reserved.

Risks in the changingautomotive landscape

AUTOMOTIVE

Joe Langley, Principal Analyst - Automotive, +1 248 465 2845, [email protected]

8 March 2017 | Plymouth, Michigan

© 2017 IHS Markit 4

2017 Spring Automotive Conference | 8 March 2017

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

0.0

4.0

8.0

12.0

16.0

20.0

2000 2004 2008 2012 2016 2020 2024

Mill

ions

%∆ Y/Y USA Sales

No grow

thUS sales

© 2017 IHS Markit

US inventory

5


0.0

1.0

2.0

3.0

4.0

5.0

-100%

-50%

0%

50%

100%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Mill

ions

Inventory/Sales Index USA Inventory

12.5-year high

Source: Autodata, IHS Markit analysis

© 2017 IHS Markit

US incentives

6


$0

$1,000

$2,000

$3,000

$4,000

-100%

-50%

0%

50%

100%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017Incentives/Sales Index USA Incentives

Source: Autodata, IHS Markit analysis



17.8 17.6 17.9 18.2 18.7 18.7 18.5 18.5 18.5

0.0

4.0

8.0

12.0

16.0

20.0

2016 2018 2020 2022 2024

Mill

ions

NA Production

3.6%North American production



9.2 8.7 8.7 8.7 8.7 8.6 8.5 8.4 8.4

8.6 8.8 9.2 9.4 10.0 10.1 10.1 10.1 10.1

0.0

4.0

8.0

12.0

16.0

20.0

2016 2018 2020 2022 2024

Mill

ions

US3 Transplants

18.0%-9.3%

Growth paths



14.3 13.4 13.4 13.4 13.8 13.8 13.8 13.8 13.6

3.5 4.1 4.5 4.7 4.9 4.8 4.8 4.7 4.9

0.0

4.0

8.0

12.0

16.0

20.0

2016 2018 2020 2022 2024

Mill

ions

USA/CAN MEX

39.0%-5.1%

Divergent trajectories



1.5 1.8 2.1 2.1 2.3 2.3 2.3 2.2 2.3

2.02.3

2.4 2.7 2.6 2.5 2.5 2.5 2.5

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2016 2018 2020 2022 2024

Mill

ions

MEX Exports ROW MEX Exports to USA

57%26%

Divergent trajectories



0%

20%

40%

60%

80%

100%

0.0

1.0

2.0

3.0

4.0

2014 2016 2018 2020 2022 2024

Mill

ions

USA/CAN MEX MEX Exports to USA

General MotorsMexico: 2016‒24• Production: +29%• ROW exports: +73%• ROW exports = 91,000• Leverage for exports

Sourcing issues• Cruze• Blazer• Terrain• Silverado/Sierra



0%

20%

40%

60%

80%

100%

0.0

1.0

2.0

3.0

4.0

2014 2016 2018 2020 2022 2024

Mill

ions


FordMexico: 2016‒24• Production: +41%• ROW exports: +21%• ROW exports = 35,000• San Luis Potosi

cancelled

Sourcing issues• Focus• Fusion



0%

20%

40%

60%

80%

100%

0.0

0.5

1.0

1.5

2.0

2.5

3.0

2014 2016 2018 2020 2022 2024

Mill

ions


Fiat Chrysler AutomobilesMexico: 2016‒24• Production: -5%• ROW exports: +39%• ROW exports = 34,000

Sourcing issues• Ram 2500/3500• Compass• ProMaster



0%

20%

40%

60%

80%

100%

0.0

0.5

1.0

1.5

2.0

2.5

2014 2016 2018 2020 2022 2024

Mill

ions


ToyotaMexico: 2016‒24• Production: +115%• ROW exports:

+1,600%• ROW exports = 14,000• Celaya review?

Sourcing issues• Corolla• Tacoma• Camry• Prius



0%

20%

40%

60%

80%

100%

0.0

0.5

1.0

1.5

2.0

2.5

2014 2016 2018 2020 2022 2024

Mill

ions


HondaMexico: 2016‒24• Production: -11%• ROW exports: -18%• ROW exports = 35,000• Celaya review?

Sourcing issues• Fit

• HR-V



0%

20%

40%

60%

80%

100%

0.0

0.5

1.0

1.5

2.0

2014 2016 2018 2020 2022 2024

Mill

ions


Renault-NissanMexico: 2016‒24• Production: +4%• ROW exports: +18%• ROW exports = 78,000• Export hub

Sourcing issues• Sentra

• Rogue

• Frontier

• New US plant?



0%

20%

40%

60%

80%

100%

0.0

0.3

0.6

0.9

1.2

1.5

2014 2016 2018 2020 2022 2024

Mill

ions


HyundaiMexico: 2016‒24• Production: +213%• ROW exports: NA• ROW exports = 234,000• Export hub

Sourcing risks• Accent/Rio

• Forte

• New US plant?

• Genesis



0%

20%

40%

60%

80%

100%

0.0

0.2

0.4

0.6

0.8

1.0

2014 2016 2018 2020 2022 2024

Mill

ions


VolkswagenMexico: 2016‒24• Production: +57%• ROW exports: +126%• ROW exports = 196,000• Export hub

Sourcing risks• Golf

• Passat

• Q5



0%

20%

40%

60%

80%

100%

0.0

0.2

0.4

0.6

2014 2016 2018 2020 2022 2024

Mill

ions


BMWMexico: 2016‒24• Production: NA• ROW exports: NA• ROW exports = 142,000• San Luis Potosi online

in 2019• Export hub

Sourcing issues• 3 Series

• Completely knocked down?



0%

20%

40%

60%

80%

100%

0.0

0.1

0.2

0.3

0.4

0.5

0.6

2014 2016 2018 2020 2022 2024

Mill

ions


DaimlerMexico: 2016‒24• Production: NA• ROW exports: NA• ROW exports = 87,000• COMPAS online in

fourth-quarter 2017• Export hub

Sourcing risks• Renault-Nissan and

Daimler fracture• Infiniti models

© 2017 IHS Markit

US exports

24


2016

• Canada = 47%• China = 14%• Mexico = 7%• Saudi Arabia = 4%• Germany = 3%• Australia = 2%

• Top-six export destinations = 80• 2.1 million units of US-sourced sales in

2016• 2016‒24 growth = 11%, or 237,000

units• US production declines 2.5%, or

304,000 units• Proposed border tax to exclude US-

based export revenue from taxation• Strong dollar undermines US exports• Tracing more complex• Potential supply disruptions; minimize

with phase-in



Border adjustment tax

San Luis Potosi, Mexico• US/Canadian content = 55%• Other = 15%• Powertrain = Korea, Mexico

Pupyong, Korea• US/Canadian content = 5%• China = 19%• Other = 65%• Powertrain = Korea, Mexico

Chevrolet Trax

© 2017 IHS Markit

Mexican content

28


0%

20%

40%

60%

80%M

azda

3

Jour

ney

Fusi

on/M

KZ

Sen

tra/V

ersa

Gol

f

Jetta

GM

K2U

X

Bee

tle

HR

-V

Pas

sat

1500

Cha

rger

Cha

lleng

er

300

Impa

la/X

TS

Con

tinen

tal

MK

C

CT6 Vol

t

GM

Alp

ha

F-15

0

Esc

ape

Alti

ma

% MEX % USA/CAN

© 2017 IHS Markit

Japanese content

29


0%

20%

40%

60%

80%Fi

t

RA

V4

Rog

ue RX

Lega

cy

Out

back

Cor

olla

Sie

nna

Fron

tier

Cam

ry

Acc

ord

Taco

ma

Tund

ra

Pat

hfin

der

Max

ima

Tita

n

% JPN % USA/CAN

© 2017 IHS Markit

South Korean and German content

30


0%

20%

40%

60%

80%E

lant

ra

Bol

t

Son

ata

San

ta F

e

Sor

ento

Leaf

% KOR % USA/CAN

0%

20%

40%

60%

80%

X3

X4

X5

X6

C-C

lass

GLE

GLS

Pas

sat

% DEU % USA/CAN

© 2017 IHS Markit

Opportunities

32


911

1813

1837

2217

68

VWToyotaNissan

HyundaiHonda

GMFordFCA

DaimlerBMW

All-newOnshoredRedesign

Launches: 2016‒22• All-new = 32• Onshoring = 13• Redesigns = 114• Cars = 62• Trucks = 19• Utilities = 78 • United States = 111• Mexico = 37• Canada = 11

159



17.818.5

15.1

13.0

14.0

15.0

16.0

17.0

18.0

19.0

2016 2018 2020 2022 2024

Mill

ions

NA NA less New/Onshoring

North American production

3.4 million

units

Opportunities

• 60 “new” vehicle programs

• New = 44

• Onshoring = 16

• -18% without “new” vehicles

• Onshoring and localization



6.7 6.6

5.2

4.0

4.5

5.0

5.5

6.0

6.5

7.0

2016 2018 2020 2022 2024

Mill

ions

Car Production Car less New/Onshoring

North American production: Car

1.4Munits

Opportunities

• 25 “new” car programs

• New = 15

• Onshoring = 10

• -21% without “new” car models




6.7

7.8

6.0

5.05.56.06.57.07.58.08.5

2016 2018 2020 2022 2024

Mill

ions

SUV/CUV SUV/CUV less New/Onshoring

North American production: SUV/CUV

1.9 million

units

Opportunities

• 31 “new” SUV/CUV programs

• New = 26

• Onshoring = 5

• -24% without “new” SUV/CUV models




Demographic

Consumer

Regulations

Utilities

© 2017 IHS Markit

US driving population

37


0

50

100

150

200

250

300

1970 1980 1990 2000 2010 2020 2030

Mill

ions

Interbellum Greatest Silent Baby Boomer Gen X Gen Y Gen Z

© 2017 IHS Markit

CUV outlook

38


Rugged

Luxury

Sport

Mass

Opportunities

• 5%, or 350,000 unitsUS sales growth (2016‒24)

• Long-term oil tempers forecast

• Mainstream = -1%

• Luxury = 17%

• Rugged = 26%

• Sport = 120%

• Price scalability

IHS MarkitTM COPYRIGHT NOTICE AND DISCLAIMER © 2017 IHS Markit.

No portion of this presentation may be reproduced, reused, or otherwise distributed in any form without prior written consent of IHS Markit. Content reproduced or redistributed with IHS Markit permission must display IHS Markit legal notices and attributions of authorship. The information contained herein is from sources considered reliable, but its accuracy and completeness are not warranted, nor are the opinions and analyses that are based upon it, and to the extent permitted by law, IHS Markit shall not be liable for any errors or omissions or any loss, damage, or expense incurred by reliance on information or any statement contained herein. In particular, please note that no representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on, any projections, forecasts, estimates, or assumptions, and, due to various risks and uncertainties, actual events and results may differ materially from forecasts and statements of belief noted herein. This presentation is not to be construed as legal or financial advice, and use of or reliance on any information in this publication is entirely at your own risk. IHS Markit and the IHS Markit logo are trademarks of IHS Markit.

IHS Markit Customer Care:[email protected]: +1 800 IHS CARE (+1 800 447 2273)Europe, Middle East, and Africa: +44 (0) 1344 328 300Asia and the Pacific Rim: +604 291 3600

Thank youFor any further questions, please contact:

Joe Langley, Principal Analyst - Automotive, +1 248 465 2845, [email protected]

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