RE: Re uncertainty2 Jul 2019 15:43
There is good and bad on the way...
Deterioration of LVP1 (light vehicle production ) Forecast Across our Major Regions
approximately 24 million fewer vehicles for the period 2019 to 2022.
That was from Veoneer's last briefing, they are hurting. R&D costs for them is far worse than ours. They have a massive order book but it is all tomorrow. The more work they take on the more their costs rise (1300 new engineers)
Now the re is a car slump coming (China trade war, environmental aspects, high cost of AV and EV and Extra safety will make cars cost more and the money isn't there) in the US the average car is 12 years old, and there isn't a ready supply of cheep 2nd hand vehicles due to the last drop in sales in 2007, so many parts of the market are suffering together. China was the bright spot in the market, but now that is hurting those who over extended there. The Chinese government is now implementing new levels of pollution control. Many of their new car Companies will fall by the wayside as they struggle to adopt the National VI standard.
But we know that now much of the market in traditional markets is tied to 3 year leases. They will continue to turnover and each generation will have new tech. NCAP etc will ensure that we have a market and it will be steady but maybe 30% smaller, but then it will be ubiquitous.
The extra delay is the grouping and regrouping of car companies as they try to adjust to all of the changes and they are forced to work together to share costs. This does benefit us as we are the safe choice as long as we are financially stable, the problem is that we may be a bit tight as consolidation delays decisions, but hopeful fleet will see us through now that it is fixed.