Car sales are slowing down worldwide

Automakers in some of the largest car markets like the US and China have reported low growth or in some cases even declining sales. It has been reported that the demand for cars has peaked and will continue to decrease due to lack of sales incentives.

In China, the world's largest auto market, demand has fallen over the last couple of months. Due to the recent trade war with US, customers are avoiding American brands. Earlier this year, the Shanghai stock market fell by 18% and yuan has weakened as well, which suggests that China's economy could be slowing down.

In Japan, the numbers are down by 3.4 percent during the first eight months of 2018 compared to same period last year. The country's ageing population is seen as a factor as many residents are giving up driving while the young generation prefers not to own a car due to the high cost of ownership. On average existing owners are replacing their vehicles in 7.7 years, which is longer than in the past.

In USA, car makers have missed the estimates for August, while reporting negative growth in the month on July. Further, the annualised sales numbers for the whole industry have reduced to the lowest in a year.

The four largest markets in Europe - Germany, UK, France and Italy have reported nil growth in the first 6 months of the current year. Despite this, the overall numbers have been in the green for the European region.

Source: Bloomberg