Auto markets face ‘outright collapse’ in 2009

Implications: The outlook for auto sales is getting worse This will have a major imapct on chemcial sales

Analysis: Collapsing housing markets are already creating major problems for chemical companies worldwide.  Now JD Power, the leading auto industry research firm, is warning that ‘the global auto market in 2009 may experience an outright collapse'.  They add that ‘while mature markets are being impacted more severely than emerging markets, no country or region is completely immune to the turmoil'.  2008 sales are already slowing alarmingly:  

·  They forecast US volumes will be down 16%, with any recovery ‘more than 18 months away’
·  China’s growth will be down to 10%, versus 24% in 2007
·  India will grow just 5%, versus 16% last year
·  Europe will be down 3% overall, with W Europe down 8% and growth in E Europe ‘slowing considerably’.  

Chemical company CEOs will need to revisit their Downside scenario in the 2009 Budget, and check once more that it really is robust in the face of such forecasts.