Global automotive production: 2023 projection
S&P Global Mobility expects global automotive production to increase 5% in 2023 compared to 2022.
Production remains below recent historical levels.
According to Lear Corporation, global industry production in 2023 is expected to be approximately 2% below pre-pandemic 2019 levels and 9% below peak 2017 levels.
Since 2020, the global economy, as well as the automotive industry, have been directly and indirectly influenced by macroeconomic events that have resulted in unfavorable conditions, such as shortages of semiconductor chips and other components, high inflation levels, higher interest rates, and labor and energy shortages in certain markets.
Among others, these factors continue to affect consumer demand, as well as the ability of automakers to produce vehicles to meet demand.
In general, Lear Corporation’s sales are driven by the number of vehicles produced by automakers, which is ultimately dependent on consumer demand for automotive vehicles and the availability of raw materials and components, and the company’s own per-vehicle content.
Global automotive production
Since 2020, the automotive industry has experienced a decline in global production volumes.
Although the industry’s production has recovered modestly with a 7% production increase in 2022 compared to 2021.
Lear Corporation’s strategy to mitigate the above impacts encompasses its comprehensive cost management process, including cost technology optimization, actions to further align its manufacturing capacity with the industry’s current production environment, investments in Industry 4.0 technologies to improve operational efficiency, and better utilization of existing facilities and equipment to reduce future expenses.
In addition to the factors mentioned above, automotive sales and production can be affected by the age of the vehicle fleet and related scrappage rates, labor relations issues, fuel prices, regulatory requirements, government initiatives, trade agreements, availability and cost of credit, among others.
