Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors. Polish Auto Market 2011 To 2012

CRI-report: Car output falls in 2011 on weaker demand in Europe

Passenger cars

The production of passenger cars in Poland fell by 5.6% YOY to 740,000 units in 2011, according to data from the Central Statistical Office (GUS). The figures published by Samar, shows that passenger car output in 2011 was at 722,300 units, down from 799,200 in 2010, and total vehicle output stood at 825,000.

For example, the plant of Fiat in Tychy reduced production by 12% in 2011 and the Polish car plant of GM forecasts its output in Q1/2012 to be 10% lower than that in the same period last year.

LCV cars

Only output of LCV grew last year mainly due to Volkswagen's Poznan plant, which made 177 vehicles and hopes to increase output further in 2012. A total of 103,200 light commercial vehicles (LCV) were assembled in the country in 2011, up from 88,000 in 2010.

Outlook for the car makers does not look too bright for the coming year. Demand in Europe, the country's main export market, is expected to shrink in 2012. In addition, the most fragile and exposed to economic turbulence is usually the segment of small and compact cars, in which Polish factories specialize, so they may suffer more than other players. The environment should remain challenging for the automotive sector until the economic situation in Europe improves.

Survey shows 60% automotive producers believe in positive future

Over half (57%) of Polish automotive companies, surveyed by consultancy, expect the sector's sales to grow in the next six months. Despite the car output decline, most industry% of those surveyed confirmed that in the past 12 months they managed to expand their activities. Nobody from those surveyed scaled back, while in 2010, there were 5% who admitted that necessity. "Careful optimism" should be attributed to the growth in orders from the European markets and the condition of the global economy, which show first evidence of revival. Forecasts for the current year remain positive, however, managers are more careful as regards the longer-term outlook. This is because they are not certain how the situation in the global economy will develop, especially in the eurozone. This is why industry players should remain careful when making any bigger investment decisions.

Nonetheless, 65% of the respondents deem that this year is a period of possible investments in individual enterprises, while one-third of them see high probability of investments in their own enterprises.

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