Welcome to Pemberton Associates

Global Automotive Strategy

The automotive world is undergoing unprecedented change. The current global recession shows every sign of being the worst for many decades, with the effect on the motor industry being particularly severe.  The traditional structure of the industry is being overturned as some of the most established companies operating in the arena disappear or are dramatically restructured.  At the same time the marketplace is moving decisively from the historically important countries of the developed world, to the developing world.

The graph shows how vehicle sales have evolved over the 50 year period from 1960 to 2009, with a short term forecast to 2012, for some of the most important areas of the world.  The G7 markets of Canada, France, Germany, Italy, Japan, the United Kingdom and the USA, which have for so long powered the growth of the industry, have been relatively stable for the last two decades, as have the Other MDC markets, which have helped underpin global volume.  The developing world, especially China, is now the engine of growth for the industry.

Although there have been many shocks to the economies of the world, not least through oil crises and war, the global long term ten-year moving average of sales has continued to climb.

The two oil shocks in the 1970's and the early 1980's had a profound effect on the G7 markets, although sales volumes in the region have been relatively stable over the past 25 years, with annual sales volumes of 35 to 38 million units, until the current crisis.

The markets of the Other MDCs region have also been relatively stable and less affected by world events, selling on average 5ive to six million units a year and providing a powerful underpinning to G7 volumes. This seeming stagnation in the G7 and Other MDC regions is due to the fact that they are largely mature and saturated in automotive terms, with further new growth dependent on population increases or changes in the structure of the population.

No such limitation exists in the DVC region, which, despite the fall of the Soviet Union and the collapse of communism - at least in Europe - and the Asian Economic crisis, sales have continued to climb with scarcely a pause, with the region accounting for virtually all volume growth over the last two decades.