amda mayo 18 webinar automotriz · 2020. 5. 20. · ihs markit customer care...

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AMDA Mayo 18

Webinar Automotriz

Confidential. © 2020 IHS Markit®. All rights reserved.


Mexico’s economic outlook18 May 2020Rafael Amiel, Director, Latin America Economics, IHS Markit


3


4

© 2018 IHS Markit. All Rights Reserved.

Developed world sees economic collapse


5

China output indices recover from record lows


Significant slow down and recession in most of the worldIn the last month we have revised our forecasts, now showing Latin America in recession, with significant

domestic demand destruction

6

Real GDP

Percent

change2018 2019 2020 2021 2022

World 3.2 2.6 -5.0 4.3 3.9

United States 2.9 2.3 -6.4 4.3 4.5

Canada 2.0 1.6 -8.3 3.5 5.1

Eurozone 1.9 1.2 -8.1 3.4 2.7

Mexico 2.1 -0.1 -10.4 1.7 2.8

China 6.7 6.1 0.5 7.8 5.6

Japan 0.3 0.7 -5.5 1.7 1.9

India* 6.1 4.9 -1.9 5.8 4.2

Brazil 1.3 1.1 -7.2 2.8 3.0

Russia 2.5 1.3 -7.3 2.9 1.9

-12.0

-10.0

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

Feb 2020 March 7, 2020 April 15, 2020 May 15, 2020

2020 GDP growth forecast (percent)

Source: IHS Markit © 2020 IHS Markit


US economy enters a deep recession

• The US economic outlook has deteriorated sharply in the past month as the coronavirus disease 2019

(COVID-19) virus has spread and most states have mandated closure of nonessential businesses.

• Equity price declines, a widening of risk spreads, and widespread disruptions of activities indicate

consumer and business spending will be considerably weaker than previously forecast.

• We assume the pandemic will subside in the third quarter. The biggest hit to US growth will come in the second quarter, when consumer spending plunges.

• The recession will result in a peak-to-trough decline in real GDP of 8.3% during the first three quarters of

2020.

• The Federal Reserve (Fed) is expected to hold its federal funds rate near zero for several years.

• The unified federal budget deficit will double to USD1.95 trillion in fiscal 2020 and peak at USD2.15 trillion in fiscal 2021 as the CARES Act is implemented.

7


The COVID-19 recession will bring a temporary surge in unemployment

8


US growth in real personal consumption and business fixed investment will

decline sharply in 2020

9

-20

-15

-10

-5

0

5

10

15

2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024

Ye

ar-

ove

r-y

ear

% c

ha

ng

e

Personal consumption Business fixed investment

Real expenditures



Latin America: recession arrived

10

22

27

32

37

42

47

52

57

62

Ap

r-1

3

Ju

l-1

3

Oct-

13

Ja

n-1

4

Ap

r-1

4

Ju

l-1

4

Oct-

14

Ja

n-1

5

Ap

r-1

5

Ju

l-1

5

Oct-

15

Ja

n-1

6

Ap

r-1

6

Ju

l-1

6

Oct-

16

Ja

n-1

7

Ap

r-1

7

Ju

l-1

7

Oct-

17

Ja

n-1

8

Ap

r-1

8

Ju

l-1

8

Oct-

18

Ja

n-1

9

Ap

r-1

9

Ju

l-1

9

Oct-

19

Ja

n-2

0

Ap

r-2

0

Brazil Mexico above 50 = expansion Colombia Brazil services

Manufacturing PMIs and service PMI for Brazil



Likely policy stimulus: not much room for policy rate cuts, but extra liquidity and credit will come

0

1

2

3

4

5

6

7

8

Brazil Mexico Colombia Peru Chile

Policy rate Inflation

Monetary policy: policy rate and inflation

Source: own countries central banks

Pe

rce

nt p

er

ye

ar

© 2020 IHS Markit

11

0

2

4

6

8

10

12

14

16

Jan-17 Sep-17 May-18 Jan-19 Sep-19 May-20

Brazil Mexico Colombia Peru Chile

Monetary policy rate

Source: IHS Markit

Pe

rce

nt p

er

ye

ar

© 2019 IHS Markit


Likely policy stimulus: fiscal stimulus should come despite already large fiscal deficits

12

-7.0

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0Argentina Brazil Chile Colombia Mexico Peru Uruguay Latin America

Fiscal Balance as a Percentage of Nominal GDP, Annual 2019



Sovereign risk increase, may lead to capital outflows

13

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

400.00

Brazil Chile Colombia Mexico Peru

Credit default swap USD 5-year spread (basis

© 2019 IHS Markit

50

70

90

110

130

150

170

190

210

08

/05/2

00

7

08

/05/2

00

8

08

/05/2

00

9

08

/05/2

01

0

08

/05/2

01

1

08

/05/2

01

2

08

/05/2

01

3

08

/05/2

01

4

08

/05/2

01

5

08

/05/2

01

6

08

/05/2

01

7

08

/05/2

01

8

08

/05/2

01

9

08

/05/2

02

0

Mexico: Foreign exchange reserves - USD billions

Source: IHS Markit © 2020


Long-term problems will still preclude growth after the pandemic is over. Investment will continue

to constrain growth in Mexico. AMLO must get trust from private investors

-20

-15

-10

-5

0

5

10

15

20

25

2011-Q2

2011-Q4

2012-Q2

2012-Q4

2013-Q2

2013-Q4

2014-Q2

2014-Q4

2015-Q2

2015-Q4

2016-Q2

2016-Q4

2017-Q2

2017-Q4

2018-Q2

2018-Q4

2019-Q2

2019-Q4

total private public

Mexico: Fixed Investment

pe

rce

nt ch

an

ge

ov

er

pre

vio

us y

ear


Mexico outlook summary

15

*Annual average, **Billions of US dollars

-50

-40

-30

-20

-10

0

2013 2015 2017 2019 2021 2023

12

14

16

18

20

22

24

2013 2015 2017 2019 2021 2023

-12-10-8-6-4-2024

2013 2015 2017 2019 2021 20232

3

4

5

6

7

2013 2015 2017 2019 2021 2023

Real GDP growth (%)

Exchange rate per US dollar*

Consumer price inflation (%)

Current-account balance**

Source: IHS Markit © 2020 IHS Markit Source: IHS Markit © 2020 IHS Markit

Source: IHS Markit © 2020 IHS Markit Source: IHS Markit © 2020 IHS Markit



Global Automotive Outlook18 May 2020Guido Vildozo, Senior Manager, Americas Light Vehicle Sales, IHS Markit


IHS Markit manufacturing PMIs® point to a serious downturn

Purchasing managers’ indexes


Coronavirus Assessment May 2020

30

35

40

45

50

55

60

65

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Ind

ex, o

ver 5

0 si

gn

als

exp

ansi

on

United States Eurozone China Japan


60.0

65.0

70.0

75.0

80.0

85.0

90.0

95.0

100.0

Source: IHS Markit – May 2020 LVS Forecast

Global Light Vehicle Sales Outlook

© 2020 IHS Markit

Global Automotive Outlook

18

Ma

rke

t

20

20

TIV

Gro

wth

(% c

hg

)

vs

. J

an

20

20

China 21.2m -14.7% -3.4m

USA 12.7m -25.4% -4.1m

WE/CE 13.3m -26.4% -4.2m

Global 69.2m -22.9% -19.5m

Note: China refers to Mainland China

Millions

May 2020 FC

Jan 2020 FC


-5% ’08

-3% ’09

Peak-to-trough

-8%


40.0

50.0

60.0

70.0

80.0

90.0

100.0

2008-09 SAAR

bottomed out at 54m (71m in ‘07)

Source: IHS Markit

Global Light Vehicle Demand – Seasonally Adjusted Annual Running Rate (SAAR)

© 2020 IHS Markit

Global Automotive SAAR

19

Millions


Q4 ‘20 still

20m units

below

SAAR below 50m

unthinkable (but real*)


0

20

40

60

80

100

120

WE SA

Grt China SA

NA SA

Benchmark index ( adjusted NA and WE totals)

Benchmark Exc Incentives

Regional “Walk” Index

• GFC: Benchmark of global financial

crisis as “normal recession” for

mature markets. Lehman/credit

crunch hit from Sept 2008 then 4-6

months before peak impact. 6-9

month recession (scrappage).

• Gr. China: instant hit to auto sales

from Covid-19 lockdown. Relatively

early exit & recovery to previous

trend levels-esp. pent-up demand.

• W.Europe: deep/longer instant hit

reflects geography & varied

lockdowns. Econ support helps but

recovery still averages out below

rates of previous recession.

• USA: H1 fall not as fast/hard as only

partial national lockdown, with poorer

recovery prospects (esp. jobs).

20

Covid-19 Benchmark GR/GFC Index vs Covid-19 Region Indices


Jan-

20

Feb-

20

Mar-

20

Apr-

20

May-

20

Jun-

20

Jul-20 Aug-

20

Sep-

20

Oct-

20

Nov-

20

Dec-

20

-10% -19% -39% -48% -43% -27% -18% -21% -9% -12% -13% -13%

© 2020 IHS MarkitSource: IHS Markit

Millions

Global 2020 LV Demand Monthly “Walk”

Note: Index is set to 100 representing the average level of the SAAR for the quarter immediately before shock/onset of recession

Note: GFC line is blended performance of WE&NA


China Outlook

U21

• Economy: Q1 GDP declined by 6.8% & 2020 GDP

growth expected to below 1%.

• Export from China declined by 6.4% in Jan-Apr

but expected to slow down significantly from H2

as EU and US would suffer from severe economic

contraction

• Demand : light vehicles sales in Apr declined by

2.8% (estimate based on CAAM), a marked

improvement comparing to 48% decline in Mar.

• We expect vehicle demand to drop 2-3% in Q2

and Q3 respectively assuming the spread of virus

is at least under control in Q2 while vehicles sales

in Q4 could decline by 7% as decelerating

exports/trade take a toll on consumer confidence

• Aversion to public transport post-outbreak could

help vehicle sales but upside limited due to much

higher vehicle density & slower economic growth.

• 17 cities/provinces have introduced vehicles

incentives inc. plate quota, NEV subsidy,

scrappage incentives. In addition, nationwide

implementation of China 6 would be postponed to

Jan, 2021 from Jul,2020. Financial institutions

were instructed to provide auto finance with lower

down payment/interest rate and longer terms

Mainland China – Covid-19 Impacted LV Sales Forecast (May 2020)

2020 2021 2022 2023

% Growth YoY -14.7% 9.9% 5.6% 5.3%

Vol Delta vs. Pre-Crisis Jan Forecast - 3,444,430 - 2,218,032 - 2,081,961 - 1,890,959


15.0

17.0

19.0

21.0

23.0

25.0

27.0

29.0

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

May '20 Apr '20 (V2)2

Note: China refers to Mainland China

Millions

Upgrade!

+210k



Europe Outlook

22

• Eurozone facing deep recession, ‘20 GDP –8.1%.

Lockdowns ended or are softened in main

European countries like Italy, Spain, France &

Germany. UK will follow soon. Tentative exit-

strategies & cautious softening of containment

measures. Cautious reopening esp. on fears of

2nd COVID-19 spike (not in basecase).

• Car dealerships reopen/look to reopen (online).

Many European automotive production plants

reopened/planning re-starts, which should

support demand recovery prospects.

• April ‘20 figures disastrous due to full-month of

lockdown in many markets.

PC April ‘20 figures : ITA -98%, ESP -97%,

UK -97%, FRA -89%, GER -61%, WE -80%.

Scandinavian countries avoided massive losses

as their containment measures were softer with

Denmark (down 38%), Finland (down 39%),

Norway (down 34%), and Sweden (down 38%).

• European governments economic support

measures—some v. big & v. quick (e.g. DEU, UK,

ITA). ECB announced measures to support bank

lending & expanded its asset purchase program.

EU/EZ mulling collective action—risk of N/S

divide. No news on EC CO2 targets. OEMs also

want/need further stimulus measures.

EU (WE/CE) – Covid-19 Impacted Light Vehicle Sales Forecast (May 2020)

2020 2021 2022 2023

% Growth YoY -26.4% 15.0% 6.8% 1.8%

Vol Delta vs. Pre-Crisis Jan Forecast -4,229,357 -2,104,462 -1,287,430 -1,049,862


10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

19.0

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

May '20 Apr '20 (V2)

-265k

Millions



USA Outlook

23

• While the economic damage brought on by

COVID-19 continues to lean to the downside, US

auto sales dropped an estimated 47% in April.

Better than some of the performances realized

elsewhere around the globe.

• OEM Incentives/support, online sales & almost

half of states not limiting dealer activity helping

to provide some cushion against worst-case

scenario.

• Vehicle inventory levels will be an important

variable moving through the immediate forecast

horizon. There could be some model-level

pressures as the sales pace picks up and

assembly plants begin slowly come online again.

• With employment losses totaling over 30 million

& the unemployment rate expected to rise to

almost 20% later this year, consumers are

expected to remain on the sidelines, pointing

towards a weak recovery outlook. US

unemployment rate settings sit at 14.9% in 2020,

13.5% in 2021, 9.5% in 2022, all up from previous

April settings. GDP of -7.3% in 2020, 5.1% in 2021,

4.6% in 2022.

• 2020 volume LVS setting of 12.7m units (-25% y/y)

followed by 14.3m in 2021 (up 12%).

USA – Covid-19 Impacted Light Vehicle Sales Forecast (May 2020)

2020 2021 2022 2023

% Growth YoY -25.4% +12.3% +8.1% +2.7%

Vol Delta vs. Pre-Crisis Jan Forecast -4,091,000 -2,291,000 -961,000 -553,000


10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

18.0

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

May '20 Apr '20 (V2)

Millions

+206k

-490k

-594k -280k



Canada Outlook

24

• The magnitude of the supply and demand shocks

from the coronavirus disease 2019 (COVID-19)

virus restrictions, not to mention the oil price war,

makes Canada's economy especially vulnerable.

• Canada's economic forecast was revised to -8.3%

in 2020, down by 2.8 percentage points compared

with the April forecast setting.

• Commensurate with the downgraded economic

outlook and low April sales total (down estimated

77% y/y), the light vehicle sales forecast for 2020

has been lowered to 1.34 million units (down from

previous 1.41 million unit setting).

• Owing to the strict social distancing measures

and closure of nonessential businesses,

employment will drop in the second quarter, with

the unemployment rate rising to 10.4%, before

slowly lowering to 9.2% in fourth quarter 2020.

Overall, household expenditures will decline 3.9%

in 2020, which is the first annual decrease since

1991.

CANADA– Covid-19 Impacted Light Vehicle Sales Forecast (May 2020)

2020 2021 2022 2023

% Growth YoY -30% 15% 7% 5%

Vol Delta vs. Pre-Crisis Jan Forecast -540,000 -359,000 -283,000 -215,000

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

2.0

2.1

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

May '20 Apr '20



Mexico Outlook

25

• The Mexican economy is now expected to

contract by 6-7% this year as President Lopez

Obrador seems reluctant to implement tougher

measures.

• Oil prices are likely to not help.

• President Lopez Obrador has instructed a

quarantine through the end of May due to

COVID 19. Automotive not considered essential

business

• The Mexican Peso has taken a severe hit, falling

to 25 MXP/USD.

• We see the US economy falling into a severe

recession in the second and third quarters of

2020 and will likely sweep Mexico along with it.

• Our forecast currently envisions YOY drops of up

to ~70% for some months of the second quarter.

• We now expect a nearly 400,000 unit drop for the

year (~32%) followed by a quick recovery.

Mexico – Covid-19 Impacted Light Vehicle Sales Forecast (May 2020)

2020 2021 2022 2023

% Growth YoY -31.9% 14.2% 11.2% 8.4%

Vol Delta vs. Pre-Crisis Jan Forecast -385K -267K 182K -131K

Coronavirus Assessment April 2020

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

May '20 Jan '20


Mexico SAAR May

26


200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

Jan-1

5

Jan-1

6

Jan-1

7

Jan-1

8

Jan-1

9

Jan-2

0

Jan-2

1

PACE LV

Mexico LV


Mexico Monthly Walk May

27


0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2018

2019

2020

2021

Jan-20 104,832 -6%

Feb-20 104,328 1%

Mar-20 87,517 -25%

Apr-20 34,903 -64%

May-20 29,235 -71%

Jun-20 48,187 -55%

Jul-20 58,588 -45%

Aug-20 66,522 -38%

Sep-20 74,929 -26%

Oct-20 82,605 -23%

Nov-20 96,389 -23%

Dec-20 107,516 -18%

Jan-21 76,372 -27%

Feb-21 77,041 -26%

Mar-21 91,099 4%

Apr-21 73,807 111%

May-21 77,563 165%

Jun-21 83,926 74%

Jul-21 79,522 36%

Aug-21 82,241 24%

Sep-21 81,145 8%

Oct-21 80,213 -3%

Nov-21 104,040 8%

Dec-21 116,098 8%

IHS Markit Customer Care

[email protected]

Americas: +1 800 IHS CARE (+1 800 447 2273)

Europe, Middle East, and Africa: +44 (0) 1344 328 300

Asia and the Pacif ic Rim: +604 291 3600

Disclaimer

The information contained in this presentation is confidential. Any unauthorized use, disclosure, reproduction, or disseminat ion, in full or in part, in any media or by any means, without the prior written permission of IHS Markit Ltd. or any of its aff iliates ("IHS Markit") is strictly prohibited. IHS Markit owns all IHS Markit logos and trade names contained in this presentation that are subject to license. Opinions, statements, estimates, and projections in this presentation (including other media) are solely those of the individual author(s) at the time of writing and do not necessarily reflect the opinions of IHS Markit. Neither IHS Markit nor the author(s) has any obligation to update this presentation in the event that any content, opinion, statement, estimate, or projection (collectively, "information") changes or subsequently becomes inaccurate. IHS Markit makes no warranty, expressed or implied, as to the accuracy, completeness, or timeliness of any information in this presentation, and shall not in any way be liable to any recipient for any inaccuracies or omi ssions. Without limiting the foregoing, IHS Markit shall have no liability whatsoever to any recipient, whether in contract, in tort (including negligence), under warranty, under statute or otherwise, in respect of any loss or damage suffered by any recipient as a resu lt of or in connection with any information provided, or any course of action determined, by it or any third party, whether or not based on any information provided. The inclusion of a link to an external website by IHS Markit should not be understood to be an endorsement of that website or the site's owners (or their products/services). IHS Markit is not responsible for either the content or output of external websites. Copyright © 2019, IHS Markit®. All rights reserved and all intellectual property rights are retained by IHS Markit.

Rafael Amiel

[email protected]

Guido Vildozo

[email protected]

¡Gracias!Thank you!

mailto:[email protected]

mailto:[email protected]

amda mayo 18 webinar automotriz · 2020. 5. 20. · ihs markit customer care...

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