Global car sales set for big gains in New Year

Written by Reuters | Toronto | Updated: Jan 1 2010, 04:25am hrs
Auto sales will gain momentum worldwide in 2010 on the back of better access to credit and a return to 3% growth in the global economy, setting the stage for record volumes in 2011, according the latest industry forecast from Scotia Economics.

China, which became the worlds largest auto market in 2009, will lead the way, along with India and Brazil, but the US market will also see a double-digit advance, according to the report, which was released on Tuesday. Global car sales will continue to be buoyed by the ongoing massive and synchronised monetary and fiscal stimulus, which has generated a global economic recovery, including improving auto lending across the globe, said Carlos Gomes, senior economist at Scotia Economics.

In fact, we estimate that auto loans across major markets bottomed in the first quarter of 2009 and have improved consistently alongside a thawing in global credit markets and falling interest rates.

Gomes said vehicle purchases in the United States would be bolstered by rising incomes, pent-up demand and low prices.