OK, well as the 2007 vehicle production figures are starting to filter out I thought it was time to provide a quick review of the production performance of the established and emerging automotive markets around the world. 2007 was quite a turbulent year for the automotive industry and there were a number of surprising facts and figures to emerge from last year’s production of vehicles around the world. According to the International Organisation of Motor Vehicle Manufacturers, OICA, just over 73 million vehicles were produced in 2007, that’s a 5.4% growth over 2006 production figures. This production figure includes passenger and commercial vehicles and is the equivalent to a global turnover of around $2.79 trillion. An interesting way to view this is that if the automotive industry were an economy then this would make it the fourth largest economy in the world (based on 2006 GDP figures) after the United States, Japan and Germany. To achieve this level of production, the automotive industry, on a global basis, employs nearly 9 million people which in turn represents 5% of the total global manufacturing employment.   

Overall there was a 5.4% growth across all markets with the largest growth of 8.5% in the Asia Pacific region, 6.3% growth in Europe and a flat growth of 0.2% in North America. Whereas most of the global growth for the past few years has come from China, Eastern Europe has seen significant new growth in 2007 with new European member countries such as the Czech Republic, Hungary and Slovakia seeing a combined growth of 25.2% over their 2006 production figures. Much of this new growth has come from western and far eastern automotive OEMs building brand new factories on green field sites in these Eastern European countries.   

KIA for example has recently built a brand new factory in Slovakia to help with demand for their vehicles in Western Europe. In order to support the production demands of these newly built factories many of their suppliers have also had to establish a presence in this region so as to reduce logistics costs of shipping parts to the car factories. Slovakia is currently seen as a new automotive hub for the Eastern European automotive industry and therefore many automotive companies are establishing a presence in this country. 

Russia is also emerging as a new region for the OEMs to manufacture their vehicles and St Petersburg Port is seen as the next area which will see significant investment from car manufacturers and their associated suppliers. Finally, the other growth region from a vehicle manufacturing perspective is India which last year saw growth of 14.4%. As India’s road infrastructure improves so the population will be encouraged to move from their traditional two and three wheeled vehicles to new low cost 4 wheel cars.  

From a North American perspective the growth was relatively flat and with the continued economic conditions in North America during 2008, many automotive companies will be facing a tough challenge to re-structure their companies in order to win new business and remain competitive. The North American automotive market is being helped by European and Far Eastern automotive manufacturers such as Hyundai increasing their presence in regions such as Alabama.  Alabama is seeing a continued interest from numerous automotive suppliers wishing to establish a presence near to the car manufacturers in this region. Overall, it is good to see that the Automotive industry is continuing to grow, albeit at a slower rate than in previous years and with emerging markets such as India, Russia and Eastern Europe starting to come online, it will help the car manufacturers and their respective supply chains exploit new markets and develop new business opportunities over the next few years.  

GXS, with one of the world’s largest B2B trading networks, Trading Grid®, is in a unique position to help automotive companies expand their businesses in every region around the world. For further information on how Trading Grid can benefit your company and allow you to reach trading partners, no matter where they may be located around the world, please visit www.gxs.com for further information.