Industry Trend Analysis - Shifting Consumer Tastes Reshaping Sales Outlook - OCT 2017

BMI View: Shifting consumer tastes in favour of SUVs and rising headwinds for consumer spending will weigh on passenger car sales, prompting a revision of our forecasts. We have revised down our passenger car sales forecast in 2017 to a decline of 2.4% and revised up our LCV sales forecast to growth of 3.0%.

We have revised our light vehicle sales forecasts and now project a 2.4% decline in passenger car sales for 2017, down from a previous forecast of 3.6% growth, and a 3.0% rise in light commercial vehicle (LCV) sales, up from 2.1% previously. The divergence in the passenger car and LCV sales forecasts is linked to two key factors. The first being a shift in consumer demand away from sedans and hatchbacks towards sport utility vehicles (SUVs) and crossovers (both of which are considered LCVs in our sales data series for Mexico). The second is the loss of momentum amongst Mexico's consumers due to stalling wage growth and rising borrowing costs.

LCVs Benefiting From Changing Consumer Tastes

Shifting Tastes Weighing On Passenger Car Sales
Light Vehicle Sales By Segment, Units & % chg y-o-y
e/f = BMI estimate/forecast. Source: AMDA, BMI

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