Vehicle trade in the world has many faces and interesting stories. Automakers try to gain ground by opening new plants in developing countries or promoting new trade agreements between economic blocs. At the same time, many governments try to protect local industries by imposing high tariffs on imports.
The case of the United States, the world's second-largest automotive market and second-largest vehicle manufacturer, is quite interesting. According to my research, the US is by far the most import-friendly trading area compared to the other two major markets, Europe and China.
Last year, of the 15.05 million light-duty vehicles sold in the US, 8.84 million were manufactured locally. This is 59 percent, which leaves an important slice of the market to foreign cars. This relatively low incidence of US-made cars in the United States contrasts with the strong presence of local vehicles in Europe and China.
Last year, 14.2 million cars manufactured in Europe were sold. Of these, 10.79 million were made on the continent, accounting for 78 percent of all new vehicle registrations in the region. Therefore, European consumers tend to buy more local products than US ones.
What Happens In China
In China, data shows an even smaller market for imports. The Asian country is the world's largest market by sales and the largest automaker. In 2021, a total of 24.47 million cars sold globally were made in China. Almost all of them, 23.37 million, were registered locally, while sales of imported cars amounted to 1.16 million. In other words, 95 percent of vehicle sales in China corresponded to units manufactured in the country.
To better understand how closed the Chinese market is, let's take the case of Mexico, where there were more cars imported than in China last year. And the Chinese market is 24 times bigger than the Mexican one.
Interesting Trends In Europe
The commercial trend in Europe shows as many faces as there are producing countries. For example, although Germany is the leading manufacturer and largest car market, it was Spain that sold the most locally made cars within the continent. According to my data, Spanish cars have found 1.76 million new customers in Europe, excluding Spain, while German cars have been bought by 1.64 million customers in the same continent, excluding Germany.
Another interesting fact that emerged from last year's data is the situation of cars manufactured in Great Britain. We all know that across the Channel, the industry is not having its best days. However, 1.07 million UK-made vehicles were sold worldwide. This is higher than Italy's and not far from Canada's 1.12 million units.
What is fascinating is that exports to Europe and the rest of the world have followed the same pattern as in Germany, usually considered a success story. In 2021, Britain sold 393,000 British-made cars outside Europe, or 37 percent of the total. Another 44 percent of the 1.07 million vehicles mentioned above were marketed in Europe excluding the UK.
German-built cars sold outside Europe accounted for 34 percent of all cars sold globally and made in Germany, while those sold in Europe excluding Germany made up 43 percent of the total.
Finally, there are Italy and France. Interestingly, the former sold more cars outside Europe than the latter. The data show that France, despite having marketed almost double the cars produced locally compared to Italy, has placed just over 150,000 units outside Europe, against the 156,000 units produced in Italy. In any case, their presence in global markets is very small, especially compared to other small countries, such as Slovakia.
The author of the article, Felipe Munoz, is an Automotive Industry Specialist at JATO Dynamics.