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The global car market is expected to reach 86.5 million units in 2023.

The global automobile market in 87 countries is forecast to grow by 7.4% (+6 million units) year-on-year to 86.5 million units in 2023.

The market recovery is particularly clear in the developed countries of Europe and the US, partly due to latent demand after the market decline of the past few years. In the emerging economies, the Chinese market, the world’s largest, will remain flat at around 25 million units, but growth is underpinned by the expansion of the Indian market and the recovery of the Central and Eastern European markets, which have maintained growth.

The star performer in global vehicle taxation is, above all, the US Inflation-Reduction Act (IRA), which began to apply at the start of 2023. Qualifying EVs receive up to USD 7,500 in tax breaks, but the conditions are gradually becoming stricter: in April 2023, origin requirements for battery components and critical minerals were added. It is worth remembering that at this time, Audi, BMW, Nissan and Volvo cars disappeared from the line-up of models eligible for the tax break.

Finally, in December, the “Declaration of no tax reduction if you use batteries from ‘foreign entities of concern'” was announced. It is not yet clear how much of an impact this will have in practice, but Tesla has already announced that the Model 3 rear-wheel drive/long range will only be available at a discount until 31 December 2023, but from 2024, the IRA as a vehicle price discount at the time of purchase rather than a refund on a traditional tax return tax reduction benefit.

In the Chinese car market, there are 14 segments, A, B, C, D, E1, E2, F, Sports, B-MPV, C-MPV, D-MPV, B-SUV, C-SUV and D-SUV, with each model segment listed in the production/plant shipment by model table.

Production statistics for the single month of October 2023 show that Chinese manufacturers account for the top models in 11 of the 14 segments. Of the remaining three segments, Tesla models topped the E1 and C-SUV segments, while Shanghai GM’s Buick GL8 topped the D-MPV segment.

The segment is forecast to grow to 88.5 million units in 2024, 92 million units in 2025 and 95 million units in 2026. If there are no major changes in global market conditions, global vehicle sales could still exceed the record 2017 result (96.2 million units) in 2027.

The key to global market expansion beyond 2024 will be the recovery and growth of emerging Asian, Middle Eastern and Latin American countries, which in January 2024 will be joined by the BRICS (Brazil, Russia, India, China and South Africa), including Egypt, Iran, Saudi Arabia and the United Arab Emirates (UAE). Although there are many unknowns in the cooperation between the countries, including the domestic political environment, situation and background, and the economic situation, the enlarged BRICS account for about 30% of the world’s GDP and more than 40% of the world’s population. In addition to a stronger political voice, there are driving forces and triggers for growth in each country’s market, and the impact on car sales needs to be closely monitored.