CHICAGO Worldwide demand for new vehicles has slowed this year, leading one consultancy to revise its global automotive forecast for the year downward.
Autofacts, a publication of New York-based PricewaterhouseCoopers LLP (PwC), forecasts global light vehicle assembly to reach 79.1 million units in 2012, down 300,000 from the 79.4 million units it forecast in the first quarter. A steady stream of disappointing news from Europe and Japan and a relatively weak performance in traditional growth markets such as Brazil, India and China have dampened the industrys outlook.
The European Union continues to be the biggest area of concern, as ongoing weak demand results in some painfully low utilization rates at assembly operations there, the consultants said in a report released Tuesday.
They said that this would "force the need for capacity rationalization in the near future." Indeed, Dearborn, Mich.-based Ford Motor Co. Wednesday announced a proposal to shut down its factory in Belgium by the end of 2014 (see related story, left).
The news is not all bad, however, because North America continues to outperform expectations. In fact, the analysts raised their forecast for assemblies to 15.3 million units, up 1.3 percent from a third-quarter forecast of 15.1 million units. This is helped by pent-up demand and increased access to financing for subprime borrowers.
They also bumped up the figure because European and Japanese transplants are building more vehicles in North America.