GlobalData (DATA) Investor Update summary

Regional market outlook

• Asia-Pacific, including China, is projected to grow moderately at 3%, mainly driven by China and India.

• Excluding China, Asia-Pacific faces flat production this year due to stagnation in Japan and declines in Korea and ASEAN.

• U.S. tariffs are expected to significantly impact Japan and Korea, with production and export declines anticipated.

Japan and Korea: Tariff and production impacts

• Japanese vehicle sales to the U.S. are forecasted to drop 17%-18% from pre-tariff levels, with a cumulative production loss of 1.1 million units through 2028.

• Korean exports to the U.S. could fall by 200,000-300,000 units annually, totaling a 1 million unit reduction by 2028.

• Hyundai can mitigate tariff impacts by localizing U.S. production, while Kia and GM Korea face greater challenges.

• Korean exports already declined 16% in April and May, with a 9% drop expected this year and a sharper 13% fall next year.

Market dynamics in Japan, Korea, and India

• Japan's market rebounded 13% in early 2024, but long-term sales face demographic headwinds and export risks.

• Korea's market remains resilient due to government tax cuts and incentives, with hybrid sales booming and BEV sales rebounding.

• India continues to expand, driven by SUV demand, favorable monsoon forecasts, and strong GDP growth, though high inventory and fiscal deficits pose risks.