Fleet News

Further consolidation predicted as sales continue to fall

BY THE turn of the century, world car sales are predicted to be facing a fall to levels last experienced in the 1980s and lead to further consolidation among manufacturers with BMW, Mitsubishi and Peugeot the likely victims of buy-outs. In its sixth annual survey of the global car market, the Economist Intelligence Unit says sales will fall at least 9% in the next two years from 3.3million vehicles to just over 32million in 2000.

This would mean a worsening of the existing problem of over-capacity. The world's vehicle industry has the capacity to make 77million cars and commercial vehicles a year and will have sales of only 47million this year, representing over-capacity of more than 39%. 'With supply likely to exceed demand by a higher margin in 2000, the pressures for car makers to cut prices, cut costs, merge or close plants will increase still further,' the report says.

It is predicted that General Motors will remain the largest car manufacturer although its share of world output is expected to fall. The Ford/Mazda grouping is seen as losing second spot to Volkswagen while the Nissan/Renault group would become the fifth largest in the world behind Toyota. The report states: 'Unless it finds a partner, Fiat is expected to drop down the world rankings from fifth place to seventh while DaimlerChrysler and PSA should move slightly up.'

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