Trends in the markets for commercial vehicles

We expect trends in the markets for light commercial vehicles in the individual regions to be mixed again in 2016. Overall, we envisage slight growth in demand, a trend that is likely to continue in the period 2017 to 2020.

Given that the economy is expected to recover further in 2016, we estimate that demand for light commercial vehicles in Western Europe will be in line with the prior-year figure. We anticipate that new registrations in Germany will be around the previous year’s level.

In the Central and Eastern European markets, registrations of light commercial vehicles in 2016 will probably be flat on the previous year. We also expect the market volume in Russia to remain stable compared with 2015.

In North and South America, the light vehicle market is reported as part of the passenger car market, which includes both passenger cars and light commercial vehicles.

The market volume in the Asia-Pacific region in 2016 will probably record a modest increase year-on-year. We are expecting demand in the Chinese market to be up on the previous year. For India we are forecasting a substantially higher volume in 2016 than in the reporting period. In the Japanese market, the downward trend is likely to continue in 2016 at a moderate pace. In the ASEAN region, we assume that the market will grow in 2016.

In the markets for mid-sized and heavy trucks that are relevant for the Volkswagen Group, new registrations in 2016 are set to drop slightly below the prior-year level. For the period 2017 to 2020 we anticipate a positive trend, however.

We expect to see demand in Western Europe and Germany slightly edge up year-on-year in 2016.

Central and Eastern European markets should also record a slight uptick in demand. Following the significant slump in the Russian market in 2015, we are forecasting a moderate recovery in demand. Despite this backlog effect, the Russian market as a whole will remain at a low level.

As pent-up demand in the US truck market has become saturated, new registrations in North America in 2016 will probably be down appreciably on the prior-year figure.

Demand in the Brazilian market in 2016 will be substantially lower than the already weak figure recorded in the previous year. This is attributable to the economic conditions, which continue to be weighed down by the muted business climate and negative growth rates.

For China, the world’s largest truck market, the significant market decline in 2015 will result in pent-up demand, so registrations in 2016 will probably be noticeably higher than in the previous year. Nevertheless, this market will not reach the high level recorded in preceding years. In India, we expect sizable growth in the market on the strength of the positive economic climate and the implementation of numerous infrastructure measures.

In the bus markets that are relevant for the Volkswagen Group, we expect that demand will decrease perceptibly in 2016. Following the sharp increase in Western Europe in 2015, we are likely to see demand dip slightly in 2016. For Central and Eastern Europe, we are forecasting that the volume of demand will be down significantly on the previous year. In South America, new registrations will probably also be substantially lower than the prior-year level.

For the period 2017 to 2020, we expect moderate growth overall in the bus markets that are relevant for the Volkswagen Group.