The Global Automobile Industry Is Entering a Period of Low Growth: Survival Requires the Restructuring of Technology Development Strategies

The global new automobile market is shifting from a high growth period to a low growth period. While the expansion of emerging markets, which led high growth, has ceased, major industrialized countries that have remained stable have also entered an era in which long-term high growth cannot be expected. Furthermore, if the “our country first” policy spreads throughout the world, overseas investment from developed countries to emerging countries will decline, making it more difficult to find new growth drivers in emerging countries. Over the past 20 years, global automobile sales have almost doubled from just over 50 million units to just under 100 million units. Although there was a recession due to the worsening global economy, China and other emerging countries drove the global market expansion. China was the main player, but the development of the Chinese economy has boosted the country’s demand for global resources, soaring resource markets which has promoted economic development in resource-rich countries. As a result, the automobile market in resource-rich countries has been booming. The fact that automakers used the world's free trade system and divided labor for the production of automobiles and parts in countries with low labor and infrastructure costs also promoted growth. Low-priced products produced by division of labor expanded sales and employment in both developed and emerging countries, promoting positive economic growth. However, in developed countries, domestic sales are weakening due to the aging of the population. Automobile sales in countries which benefitted from soaring prices of oil and mineral resources will continue to stagnate after demand for natural resources coming to a full circle. China, which contributed most to the expansion of the global automobile market, fell 12 percent in the first half of 2019 following domestic shipment sales falling below the previous year's results in 2018. From 2020 onwards, there is concern over the impact of the one-child policy on the aging population.

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