2012-06-29 23:29:48 - Germany Autos Report Q3 2012 - a new market research report on companiesandmarkets.com

The price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.After a nearly 9% year-on-year (y-o-y) growth in vehicles sales during 2011, new passenger car sales in Germany grew a modest 2% y-o-y (to just over 1mn units) during the first four months of the year, in line with BMI´s forecast of a marginal 1% y-o-y growth in car sales..Although commercial vehicle demand has fallen marginally this year, our expectations of macroeconomic activity recovering in Q212 and Q312, and the sharp rise in business expectations in recent months, indicate that our forecast of a 5%

 

 

growth in commercial vehicle sales remain on the cards. We accordingly keep our 2012 forecast of a cumulative 1.5% y-o-y growth unchanged this quarter. Similarly, we are cautious about any significant growth in German vehicle exports and production in view of economic headwinds in the eurozone, and accordingly forecast growth of 2.4% y-o-y and 4.4% y-o-y respectively during the year. The caution was also visible in Mercedes-Benz´s plans to reduce its research and development (R&D) budget by more than EUR1.5bn (US$1.94bn) annually, as revealed by R&D Chief Thomas Webber. The carmaker said it will achieve its target by reducing the number of vehicle platforms and using similar components across segments.

Two other key trends have been dominant among German auto firms this quarter. The companies are increasingly looking at overseas acquisitions, partnerships or investments to help them develop their portfolio or expand their presence in key emerging markets. In March 2012, Daimler increased its stake in Russian truck maker Kamaz from 15% to 25% plus one, in a move which BMI sees as part of the firm´s attempt to strengthen its presence in the market. In the same month, BMW signed a contract with Japanese automaker Toyota Motor Corporation (TMC) for collaborative research on next-generation battery cells, in line with BMW´s broader aims of launching an electric city car and a rechargeable hybrid car by 2013. On the other hand, Audi, in April 2012, revealed it will be looking to invest up to US$2bn in building a new plant for production of its Q5 sports utility vehicle (SUV) in Mexico by 2016. BMI believes the move is highly strategic, as it will help Audi compete with its bigger rivals in North America, particularly in the US, as well as tap into the growing trend of premiumisation in Latin America.

However, competition is tight among the German brands, with each company looking to outshine the other. The latest example of this was Audi´s acquisition of the high-performance motorcycle manufacturer Ducati from Italian buyout firm Investindustrial. Although Volkswagen (VW) sees Ducati´s high performance and lightweight construction as an ideal fit for Audi, the move is broadly aimed at providing VW a strong entry point into the two-wheeler segment and enabling it to compete with rival BMW. However, we believe that the acquisition is far from strategic, given that VW already has as many as 10 brands under its banner and needs to focus on alternative fuel development while also clearing up the long-awaited merger between MAN and Scania and integrating its automotive group with Porsche.

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