IHS Automotive expects North American light-vehicle output to reach 16.1 million units this year, the region's highest level since 2002. The company pegs US vehicle production to reach 10.84 million units this year, reflecting a 7.1% gain to support stronger sales. Light-vehicle production in Canada in 2013 is expected to taper and decline 6.8% to reach 2.29 million units. In Mexico, 2013 output is expected to rise 3% to reach a record three million units, due to the additional capacity added in the country.
Significance: Despite falling 4.9% year-on-year (y/y) in March to 1.35 million units, first-quarter light-vehicle output in North America edged up 0.5% y/y to reach 3.98 million units. Due to adequate US inventories and the progressively stronger sales pace through 2013, first-quarter output reflected more-measured production levels that are expected to ramp up in second-quarter 2013 to 4.2 million units. While the Detroit automakers currently have their North American plants running at or above full capacity, the Japanese automakers continue to ramp up output in the region in line with their investment plans unveiled in recent years to tackle the historically high yen against the dollar. Although the yen's recent weakening does offer the potential for measured investment/expansion delays, this is expected to be short-lived. IHS Automotive's medium- to long-term assessment continues to be based on the fact that global automakers will align vehicle production with the markets in which they are sold.
