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The auto world of the future: Who will rule?

November 11, 2010

Former Merrill Lynch analyst John Casesa extrapolated automobile production trends from 2005 to 2009 to see what the auto world would look like in 2018 and discovered a radically changed global landscape.

He said Toyota, which only displaced GM as the world’s number one automaker in 2008, would drop from the top spot down to No. 3.

Casesa sees Volkswagen passing Toyota to become the new No. 1, followed by Hyundai/Kia in second place. Both companies are expanding quickly in North America and doing well in developing markets.

Casesa’s calculations contain some other big surprises: He sees General Motors slipping from second to 10th in the world, and Ford falling from fourth to eighth.

That may be a little harsh. GM’s market share in North America with its four remaining brands seems to have stabilized, while Ford has been gaining share.

The rest of Casesa’s Top 10 has Renault Nissan in fourth, Honda in fifth, Fiat-Chrysler in sixth, and France’s Peugeot — a remarkable survivor given its concentration in its home country and its shunning of mergers — in seventh.

Another surprise makes Casesa’s list at number nine: China. The Chinese government is likely to force the merger of several smaller companies to create one global competitor.

But there is more than one way to divine the future. IHS Global Insight, which produces economic and market forecasts, uses a more data-intensive method. It makes a bottom-up forecast by looking at each company’s production plans, factoring in market strength and economic growth, and making some educated guesses.

This more incremental approach produces a ranking of top global players relatively unchanged from today.

Toyota, IHS forecasts, remains No. 1, GM is the runner-up, and VW comes in third. Rounding out the top six: Renault/Nissan in fourth, Ford in fifth, and Hyundai/Kia in sixth.

The problem with all forecasts is that they can’t anticipate discontinuous events. Mercedes-Benz, for instance, would have shot up the list after the DaimlerChrysler merger in 1999, and then dropped down again after the merger was dissolved.

 

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