Global Ex-factory Sales Expected to Grow 11% y-y in 2021
The author is an analyst of NH Investment & Securities. He can be reached at soohong.cho@nhqv.com. -- Ed.
Bottoming out from April, global auto demand to grow at high single-digit pace in 2021
In June, global auto sales continued to slide, coming to 6.36mn units (-18.1% y-y); however, the pace of decline slowed after global auto sales tumbled 44.8% y-y in April. Annual global auto demand is projected to reach 77mn units (-14.7% y-y) this year. While Covid-19 uncertainties remain in play (especially for EMs such as India and Brazil), auto production and demand should normalize over 2H20~2021, given that many countries are lifting lockdowns and introducing various relief packages. While employment recovery numbers are to be key to any rebound in demand, global auto demand should improve 9.2% y-y to 84.11mn units in 2021, helped by low-base effects.
HMG to show 2021 global ex-factory sales of 6.9mn units (+11.1% y-y)
Although HMG’s annual global ex-factory sales will likely slide to 6.21mn units (-12.6% y-y) this year, the figure should rebound to 6.9mn units (+11.1% y-y) in 2021. While external uncertainties remain in play, and while the ongoing Chinese market recovery remains slow paced, HMG should enjoy intrinsic value improvement through 2021, supported by the releases of new models based on third-generation platforms. For 2020, HMC and Kia should see global ex-factory sales of 3.73mn units (-15.3% y-y) and 2.47mn units (-8.3% y-y), respectively. In 2021, however, the figures are likely to recover to 4.15mn units (+11.1% y-y) for HMC and 2.75mn units (+11.1% y-y) for Kia, backed by both sound new model effects and low-base effects (y-y).