IHS revises registration forecasts
Following the UK’s vote to exit the European Union (EU), IHS Automotive has forecast an even greater fall in registrations during the coming years than already expected.
Amidst a sea of ‘unknowns’, IHS currently expects that while the market will remain up in the full year of 2016 it has reduced this improvement to just one per cent year-on-year (y/y) to around 3.045 million units, versus the 3.2% y/y gain that had previously been anticipated.
IHS suggests the declines that were already forecast to take place during 2017 and 2018 are now expected to be steeper. Registrations of light vehicles are now forecast to fall by 9.1% y/y to 2.758 million, rather than a 3.5% y/y decline. For 2018, registrations are now expected to hit 2.71 million units versus the 2.94 million units for our pre-referendum forecast.
In addition, its Western European forecast has also been reduced over the next two years despite further gains during 2016. Although light-vehicle registrations will grow by around five per cent y/y this year to 15.64 million units, it will be behind the 15.75 million units that was expected. Furthermore, registrations in 2017 are expected to dip by 1.2% y/y to 15.45 million units, compared to the increase to 15.98 million that had been expected. During 2018, the situation is now expected to be flat at 15.45 million units rather than standing at 15.95 million units as was expected.
On a global basis, IHS also now expects growth to be less substantial over the next few years.
IHS states, ‘These early indications are based upon the initial macro forecasts published by IHS on the impact that the leave vote will have. They are still subject to a great deal of unknown factors further down the line. For this reason, we currently assume a medium-to-hard Brexit scenario.’