World Vehicle Sales Grew 6.0% in 2016

Global vehicle sales totaled 9.05 million in December, rising 6.0% above like-2015, and bringing the 2016 total to 93.57 million. The all-time record, a 5.4% boost over 2015, arose from improvements in every region except South America.

The biggest source of growth came from China, which secured 30% of the world market and increased sales an estimated 14.4% to 28.15 million units for the year. News that small-engine-vehicle tax breaks only would be reduced, not ended, in 2017 called for modest forecasts for December. However, the last month brought an estimated 13.9% more sales than year-ago. SUV deliveries continued to sky rocket, with Chinese brands reaping most of the benefit. U.S. luxury brands such as Cadillac and Lincoln also witnessed double-digit gains.

Overall, the Asia-Pacific region grew 9.5% over 2015, with close to 47 million deliveries. The Philippines saw a 21.2% improvement for the year and Vietnam sales soared 30.3% to 273,000.  

Singapore witnessed the biggest growth, leaping 40.5% to 110,500 sales for the year. The city state was named Asia’s top city for quality of life in 2016 and hopes to be a leader in autonomous-vehicle adoption. With only one car for about every nine people in latest estimates, continued growth in the auto industry is expected.

Sales in Japan were stronger in second-half 2016 but ended the year 1.5% below 2015 with 4.97 million units. In June, sales were 4.8% behind like-2015. Domestic vehicles accounted for about 97% of volume, with German cars holding the majority of imports.

It was a good year for India’s auto dealers, delivering 7.1% more vehicles than 2015. Sales reached 3.71 million units. Interestingly, Germany, with one-sixteenth the population, had almost the same annual total.  

In Europe, December growth of 2.4% brought the region’s year-end total up 5.3% to 20.29 million vehicles. Even with a tumultuous year of terror attacks, a historic immigrant crisis and the U.K.’s decision to leave the E.U., Europe’s automotive industry continued to inch back toward pre-recession levels.

Progress was seen in full-year 2016 totals in each of Europe’s five largest markets. Demand grew 5.7% in France to 2.48 million and ticked up 4.8% in Germany. Italy increased the most with an 18.8% leap to 2.05 million units, after hovering below 2 million for five years. In Spain, a 10.0% boost in December deliveries brought the 2016 total to 1.35 million vehicles, jumping 11.0% above 2015.

The Netherlands was one of the few European countries where sales fell 2016. Automakers in the country known for bicycle-friendly cities sold 469,000 units, falling 9.9% below prior-year.

Recording the second month of year-over-year growth after nearly three years of losses, Russia sales inched up 1.0% in December with 159,000 vehicles. The full-year 2016 total of 1.53 million was still 9.5% below prior-year and only half of 2012’s tally.

In neighboring Ukraine, sales surged 43.7% in 2016 to 75,000 vehicles. Several automakers invested in production there during the year to build a local base for exports to Eastern Europe. A weak hryvnia, a free-trade agreement with the EU, and a stabilizing economy helped lower production and logistics costs. Despite the huge year-over-year growth, sales reached a fraction of 2009’s total of over 700,000 vehicles.

Residual pent-up demand and overall economic recovery bodes well for the European auto industry in 2017.

Last year was another difficult one in South America, with oil-exporting countries suffering from low oil prices, plus political unrest and extreme weather, leaving few buyers. The region ended the year 12.5% behind 2015, with 3.82 million vehicle sales. December’s total of 354,000 units was 4.3% below like-2015.

Venezuela’s auto market took the biggest hit, tumbling 82.9% to 3,000 for the year. Food and electricity shortages led to widespread demonstrations against President Nicolas Maduro in the fall. Sales reached 490,000 units just nine years ago in the country that is home to the world’s largest oil reserves.

In Brazil, sales dropped 20.1% to 2.05 million in the same year President Dilma Rousseff was impeached for illegally manipulating the federal budget amid increasing economic struggles.

Outpacing the region, Argentina and Chile increased sales in 2016. A luxury-car tax rollback and healthy agriculture industry fueled Argentina’s 10.5% boost to 700,000 sales, with pickup and SUV sales benefiting the most. In neighboring Chile, low interest rates and competitive pricing helped bring sales up 7.3% to 320,000.

At the end of November, OPEC agreed to reduce oil production in 2017. The move immediately increased oil prices and should help South American and other struggling oil-exporting nations in the near future. 

North America sales posted record annual sales for the second year in a row, with 21.5 million units. The region’s tally was 1.5% above 2015, with best-ever totals from each country

Heavy incentives in December fueled a 2.8% rise in U.S. sales for the month and pushed the year-end total 0.1% above 2015 to 17.87 million.

In Canada, sales took a 2.5% dip in December but ended the year 2.4% above 2015 with 1.98 million deliveries.

Demand in Mexico soared 19.8% in December to 198,000 units, a best-ever total for any month. The year finished 18.6% higher than 2015, with 1.65 million cars and trucks sold. Mexico has about 4.7 persons per car, so there still is plenty of room for growth.

Globally, Volkswagen Group claimed the top spot for delivery volume, with a reported 10.3 million total. Despite the Dieselgate scandal, sales increased 1.4% year-over-year. Toyota came in second with 9.94 million units, a 0.2% improvement over 2015. Renault-Nissan came in third and Hyundai took fourth.

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