2013 Automotive Industry Outlook Frost & Sullivan

2013 Automotive Industry Outlook: Learn the 5 2013 Automotive Industry Outlook: Learn the 5 Bold Predictions and TrendsBold Predictions and Trends

OEM Expected to Cross 10 Million Sales, Another to be AcquiredOEM Expected to Cross 10 Million Sales, Another to be Acquired

Martyn Briggs,

Program Manager, Mobility

Mohamed Mubarak,

Program Manager, Program Manager, Mobility

Automotive & Transportation

© 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.

Program Manager,


February 5, 2013

Today’s Presenters

Mohamed Mubarak

Moosa, Program Manager

Martyn Briggs,

Program Manager

2

Moosa, Program Manager

Frost & Sullivan

A Consultant with about 7+ years of experience in strategy consulting and research across Automotive sector. My current focus areas are related to tracking next generation distributive business models & innovations, megatrends impacting Automotive sector, urban mobility, and the markets in emerging countries. Based in Istanbul, I currently manage the research and consulting activities of Frost & Sullivan, Turkey.

Program Manager

Frost & Sullivan

Experienced Automotive & Transportation consultant and Project Manager, working with clients to implement growth strategies. My current working focus is related to Mobility networks and associated Mega Tends, considering the role of technology and forecasting new market opportunities.

Focus Points of Our Presentation Today

1. Top Key Predictions and Trends for 2013

2. Market Growth Forecasts

3. Highlight Key Growing Markets, Customer Segments, Models And

3

Opportunities For Industry Players

Poll Question

Which OEM do you think has all the right strategies in place to reach the

10 Million vehicle sales in 2013?

A. Toyota

B. Volkswagen

4

B. Volkswagen

C. General Motors

Briefly Discuss Occasion for the Analyst Briefing

• Urgency of the topic: There were over 80 million light vehicles sold across the globe in 2012, with total vehicles on our roads crossing the 1 billion mark for the first time in history.

• Newsworthiness of topic: Our Automotive outlook reports are designed to showcase the previous year’s performance, whilst delivering key insights and highlighting growth opportunities for the years ahead

5

highlighting growth opportunities for the years ahead

• How this will affect the participants: Our analyst briefing will provide a comprehensive insight of future automotive trends, highlighting key growth markets, customers to focus on, evaluate competition and this will allow our clients to identify uncontested growth opportunities

Top 5 Key Predictions for 2013

China is expected to sell 20 million vehicles and U.S. is expected to cross the 15 million mark

We expect to see an OEM sell over 10 million units

6

Frost & Sullivan expects at least one inter brand JV this year between OEMs and possibly consolidation or a M&A

On-line vehicle retailing to take off in 2012 with OEMs implementing an omni channel strategy to sell more vehicles digitally

Autonomous Driving to be the most exciting topic of Research and Development in 2013 with a possibility of a trial test in sub-city condition going live by end of 2013/early 2014

Top 5 Market Trends

Budget car Luxury Small / Mobility Increase in

7

Budget car

syndrome is

back

Luxury

market to

grow in BRIC

Small /

Compact

SUV’s and

Crossovers

Mobility

reinventing

the

automobile

Industry

Increase in

leasing

contracts and

new business

models for

vehicle

leasing

Global Light Vehicle Sales by Region in 2013 – A SnapshotChina to cross 20 million sales and U.S. to reach15 million mark, while the market in Europe will still be in red

Automotive Industry Outlook: Light Vehicle Sales, Global, 2012-2013U

nit

s (

Mil

lio

n)

Japan

India

Other

Korea

Indonesia 1

~ 83.5 Million

Eastern Europe

Middle East

North America

Others

Western Europe

Middle East

North America

Others

South America

Western Europe

80.4 Million

South America

2013

3.9% YoY growth (2012-13)

8

Note: Africa - South Africa

Asia - Australia, China, India, Indonesia, Japan, Korea, Malaysia, Philippines, Taiwan, Thailand, New Zealand

Eastern Europe – Bulgaria, Bosnia, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Turkey, Ukraine

Middle East – Egypt, Iran

North America - Canada, Mexico, USA

South America - Argentina, Brazil, Chile, Colombia, Ecuador, Uruguay, Venezuela

Western Europe - Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, UK

Un

its

(M

illi

on

)

China

Russia

Others

Poland

Turkey

MexicoCanada

USA

Brazil

ArgentinaOthers

France

Germany

Italy

Spain UK

Iran

Other

Africa

Asia

Eastern Europe

Africa

Asia

Eastern Europe

Others

Note: All figures are rounded; the base year is 2012. Source: LMC forecasting, Frost & Sullivan analysis.

Global Medium and Heavy CV Market Forecast 2013: Despite Strong

Headwinds for Markets Such as Western Europe and North America, Improving Chinese Manufacturing Indices and Strength in BRIC and Next 11 Countries Will Elevate MCv and HCV Sales to Over 2.9 Million by 2013

800,000

1,000,000

1,200,000

MCV HCV

2013 Regional Shares

Global CV Outlook 2013: Unit Shipments, Global, 2012 and 2013

~2.8 million ~2.93 million

4.3 % YoY Growth

35 %34 %

9

0

200,000

400,000

600,000

North America

South America

China India Russia Western Europe

Next 11 RoW2012

85.1 %

Note: All figures are rounded; the base year is 2012. Source: Frost & Sullivan analysis.

2013

66 %

65 %

Next 11 includes countries: Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea, Vietnam and Bangladesh.

Indonesia and the Global Context – 2012 Among the major passenger car markets of the world, Indonesia has climbed up two places to the 13th

position

7%

13.8%

Jump from

In 2012 Indonesia was one of three fastest growing car markets in the world

Un

its

(M

illi

on

)

Automotive Industry Outlook: Top 21 Automotive Markets, Global, 2011-2012

10

22.8%

3.4%5% 10%

5%6.5%

56.0%

39.3%8.0%

9.0% 0.1%

-3%-13.3% -21.0%

-8% -5.5%-10.0%

-13.4%-5.0%

18th to 13th rank

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Un

its

(M

illi

on

)


Global Light Vehicle Sales by OEM in 2013 – A SnapshotEuropean OEMs banking on the growth in Emerging markets to offset the downturn in Europe

Fiat-Chrysler Group

Ford Group

Hyundai Group

Renault-Nissan Group

General Motors Group

Toyota Group

Volkswagen Group8.90%

1.54%

4.57%

4.17%

3.99%

6.47%

2.10%

Automotive Industry Outlook: Light Vehicle Sales by OEM, Global, 2012-2013

Who can reach the 10 Million Vehicle sales in 2013?

11

0 6 12

Geely Group

Tata Group

Daimler Group

BMW Group

Other Chinese Manufacturers

Suzuki Group

PSA Group

Honda Group

Units (Million)2013 2012

2.10%

8.44%

4.00%

-1.09%

22.86%

2.57%

6.95%

12.34%

19.35%


Budget Car Syndrome is BackRenault aims to sell about a million vehicles from its Dacia brand in 2013, especially in the emerging markets like Russia and LATAM – What are the other OEMs upto?

Un

it S

ale

s (

Th

ou

sa

nd

))

Automotive Industry Outlook: Sales of Dacia Brand Vehicles, Global, 2012-2013

Close to $4,000,

No / few safety features

600 - 800cc and 4 Door 5 Seater

Close to $8000

Most safety features incl.

800cc and 4 Door 4 SeaterDuster

Duster

Others

Others

8,000

12,000

850 Thousand

1 Million

12

Un

it S

ale

s (

Th

ou

sa

nd

))


800cc and 4 Door 4 Seater

Less than $12,000

Safety Features Incl.

1400cc and 4 Door 4 Seater

$7,700 to $14,000

4 Door 4 Seater, Compact model car

1.0 to 1.4L

Sandero Sandero

Logan Sedan

Logan Sedan

Duster

0

4,000

2012 2013

Global SUV and Pick-Up Market - Toyota expected to continue to dominate all key SUV

and Pickup segments while Ford and GM are expected increase share within each market segment through new launches. About 20-23 sub-compact and compact models are expected to be launched in 2013

Un

it S

ale

s (

tho

us

an

ds

)

Automotive Industry Outlook: SUV and Pickup Market by Segments, Global, 2013

4,000

6,000

8,000

2012 2013

Small/compact SUV’s and Cross-overs to account for about 50% of total SUV and Pickup market

13

159.3% 9.3% 5.1% 4.4% 4.6%

YoY Growth Rates

(‘12-’13)

Un

it S

ale

s (

tho

us

an

ds

)

-

2,000

A - BASIC B - SUBCOMPACT C - COMPACT SUV - SUV P - PICKUP

2012 2013

Key OEMs Strategy for Luxury Car MarketGrowth in the BRICs boost the share of European OEMs in the Luxury vehicle market, which is expected to be replicated by Tata and Geely

Luxury OEMs US G5 Brazil Russia India China Global

BMW Group 19% 33% 26% 21% 36% 25% 26%

Volkswagen Group 10% 28% 15% 21% 27% 36% 23%

Daimler Group 16% 25% 24% 17% 26% 19% 20%

Toyota Group 14% 1% 0.04% 9% - 6% 7%

Automotive Industry Outlook: Luxury Vehicle Market -Top 10 Luxury OEM by Market Share, 2012

14

Geely Group 4% 4% 11% 11% 3% 4% 6%

Tata Group 3% 5% 24% 14% 8% 4% 5%

General Motors Group

10% 0.01% - 1% - 2% 3%

Honda Group 9% - - - - 0.48% 3%

Renault-Nissan Group

6% 0.21% - 6% - 1% 2%

Fiat-Chrysler Group 0.01% 3% 0.15% 0.06% - 0.11% 2%


Outlook of Global Carsharing 2013Globally carsharing expected to cross 3 million members and 70,000 vehicles (cumulative). Like Paris, Seoul city government to launch 492 cars in February 2013

Country Members Vehicles Ratio

Europe 0.94 Million 25,650 35.3

North America 1.12 Million 18,800 59.6

Asia Pacific 0.28 Million 9,800 28.6

South America 1,500 60 25.0

Worldwide 2.3 Million 54,310 42.3

Carsharing Vehicles & Members (World), 2012

15

What’s next in 2013?

• Daimler Car2Go targets expansion by addition of B2B customers

• AVIS Budget’s Zipcar acquisition one of the potential many in 2013.

• Tradional CSO's such as Zipcar and Greenwheels are expected to expand to other densely populated cities in Europe

• Autolib to invest the additional funding secured to strengthen fleet to 3,000 cars; add 200 underground stations

• DB plans to add foldable Hiriko micro-mobility to its fleet in 2013.

• Both Car2Go and BMW’s Alphacity to push growth in B2B segment

Source: Frost & Sullivan Analysis

• To another 162,000 member and 3,500 vehicles

• Toyota aggressive on expansion

• Launches expected in Chinese markets

Evolution of the Bricks and Clicks Model in New Car RetailingRetail model will evolve from a single/multiple channel to an integrated cross-channel model

Conventional dealership model Online car configurator

Google search Mobile apps

Bricks (pre-2000) +Advent of Clicks (post-2010)

16

Interactive Stores(motion sensor displays)

Mobile Stores(ambient mobile

retail)

Flagship Stores(modern retail)

The Future - Bricks and Clicks (2015 and Beyond)

Images used soley for illustration. Source: Frost & Sullivan analysis.

Body Styling Strategy of OEMsBold, sleek and panoramic designs to change the face of automotive body styles

a) Electrification of powertrainsEVs and Connectivity helping designers to take advantage of space benefits and design cars that meet future mobility needs

b) Bold, Aggressive LooksAs emerging economies are expected to contribute over 55% of car sales by 2020, A and B segment cars are redesigned with bold, trendy and aggressive looks to attract next generation young consumers who are more

Reasons Model Examples

17

attract next generation young consumers who are more attracted towards smart, connected and social devices.

d) Sophisticated and shape Changing CarsIn the future we could see cars that can fly, fold, change size and shape

c) Longer wheelbase, sleek and inspired from past designsPremium and sports vehicles are designed with longer wheelbase, sleek and shape inspired from 1960-70’s vehicles

Sources: Media websites. Images used for illustration purposes only, Frost & Sullivan analysis

Global Powertrain Mix by Region in 2013 [Sales] – A SnapshotGasoline to remain the main fuel account for 3/4ths of the global market; Diesel growth only in Europe

Global Automotive Industry 2013: Light Vehicle Sales, Global, 2013

Un

its

(M

illi

on

)

~70 Million*

2013

Diesel,

Mild Hybrids. 0.3%

Alt. Fuels 4.9%

Full Hybrids,

EVs,

18

Un

its

(M

illi

on

)


* - Sales in China, Japan, India, Eastern Europe, North America, South America and Western Europe only

Gasoline,

Global Electric Vehicle Sales – 2012The sale of electric vehicles has increased by over 154% and 109,700 units have been sold globally in 2012 as compared to 43,000 sold in 2011

Automotive Industry Outlook: Electric Vehicle Sales, Global, 2012

19

USA48%

Europe22%

China10%

Japan20%

Electric Vehicle Market: Breakdown by Region, Global, 2012

BEV50%

eREV29%

NEV1%

Unclassified4%

Electric Vehicle Market: Breakdown by EV Type


Global Light Vehicles in OperationWorld record of 1bn cars on road in 2012, a historical achievement, creating huge opportunity for aftermarket.

Western Europe

Eastern Europe

Asia

Others

Western Europe

Eastern Europe

Asia

Others

1 Billion VIO1.28

Billion VIO

Automotive Industry Outlook: Light Vehicles in Operation by Country, Global, 2020

Austrail ia

China

Japan

Italy

GermanyUnited States

150

200

250

300

350

400

450V

eh

icle

s (

Millio

n)

20

NOTE: Asia includes: China, India, Indonesia, Japan, Korea, Malaysia, Philippines, Taiwan, Thailand, New Zealand

Eastern Europe includes: Bulgaria, Bosnia, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Poland, Romania, Russia, Serbia,

Slovakia, Slovenia, Turkey, Ukraine

North America includes: United States, Canada, Mexico,

South America includes: Argentina, Brazil,

Western Europe - Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain,

Sweden, Switzerland, UKNote: All figures are rounded; the base year is 2012 Source: LMC Forecasting / Frost & Sullivan

North America

South America

28.7

North America

331.8

2012 2020

Others

South Africa

Others

India

Others

Poland

Turkey

Russia

Others

Spain

United Kingdom

France

Brazil

Argentina

Mexico

Canada

0

50

100

NorthAmerica

SouthAmerica

WesternEurope

EasternEurope

Asia Others

Ve

hic

les

(M

illio

n)

South America

33.9

Key Conclusions

Global sales are expected to grow by 4 percent to reach 83.5 Million vehicles. US market is expected to reach 15 million and China to cross 20 Million by sales

Compact vehicle segment is expected to be the most attractive

ASEAN offers significant opportunity to Global Automakers in the near to medium term

2013 Global Automotive

21

Compact vehicle segment is expected to be the most attractive segment accounting for over 29% share. SUV and luxury vehicle market is expected to push the growth in both U.S. and China

Carsharing is expected to cross 3 Million membership globally. OEMs aggressive in entering and expanding the carsharing network

2013 will be another year focusing on the mobility apps while we will start witnessing the phase of transition from handwriting recognition to gesture recognition systems.

Automotive Market

Source: Frost & Sullivan analysis.

Global Team

Masaki HondaJapan

Jason HuangChina

Dominik BusztaCEE

Franck Leveque Europe

22

V G RamakrishnanIndia

VitaAPAC

Kudzanayi BangureAfricas

Michel JohansonLATAM

Lisa WhalenNorth America

Melih NalciogluPoland

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For Additional Information

Katja FeickCorporate Communications


+49 (0) 69 [email protected]

Mohamed Mubarak

Program Manager


+90 212 709 8804 Extn: 132

[email protected]

26

Martyn Briggs

Program Manager – Mobility


0044 (0)207 915 7830

[email protected]

Cyril Cromier

VP Sales


+33 1 4281 2244

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2013 Automotive Industry Outlook Frost & Sullivan