Moody’s Investors Service has raised its outlook for the global automotive industry to positive from stable.
Today’s change in the industry-wide outlook was prompted by Moody’s view that trends in volumes, demand and prices in the auto industry have recovered faster than the rating agency had anticipated earlier in the year. “Indeed, volumes in China and Brazil in particular have improved, and western Europe is holding up better than expected so far,” says Falk Frey, Senior Vice President in Moody’s Corporate Finance Group. “Moreover, the US is on track toward recovery and Japan continues to benefit from incentives,” Mr. Frey adds.
Overall, in view of the volatile nature of the industry’s demand cycles, the recovery in the global auto sector appears to be stronger than that of the broader economy in many regions.
As regards unit sales of global light vehicles, Moody’s has raised its base case forecast for 2010 largely based on continued strong demand in China. Specifically, the rating agency expects global unit sales volumes of 67.6 million — or a 5.5% increase over 2009 unit sales — compared with its previous forecast of 65.3 million units, or a 2% increase.