Last Sunday I was honored to present FSG’s Global Economic Outlook at the Society of Automotive Analysts’ Outlook conference in Detroit, the unofficial kickoff of the prestigious North American international Auto Show. I lightheartedly titled my presentation “How to Stop Worrying and Love Volatility” because 2019 promised to feel even more unstable for business and investors than 2018.
We expect slower growth globally — from 3.3% GDP increase last year to 3.0% this year — especially in the major advanced economies. Large auto-producing economies like China and Mexico will experience economic pressure domestically and ongoing uncertainty about trade with the US. South Korea’s economy is suffering from its China-dependent value chain while peace with North Korea is back in the spotlight. More dangerous than slowing economic growth is the risk of over-interpreting the bad news in the international business press. Financial-market volatility will continue as pundits grapple with a business-cycle downturn on the horizon in the US and eventually Europe, but there remains plenty of opportunity for multinational companies.
I also highlighted a couple of emerging markets that have become significant players in the auto industry, one of which faces much higher downside risk in 2019, and one of which might surprise foreign observers by overperforming. Which countries? You just had to be there — or you can find out by filling out the form below to download my presentation.
In our forecasting panel discussion, I shared the stage with forecasters from the Federal Reserve Bank of Chicago, General Motors, LMC Automotive, IHS Markit, and Wards Intelligence. Changing technology and customer preferences are transforming mobility, but the transition is proving challenging to the established automotive players and their business models. Autonomous vehicles, electrification, and ridesharing are reaching tipping points, causing American automotive incumbents to embark on unprecedented partnerships and dramatically reassign engineering talent. This year’s Auto Show promises to see some eye-catching announcements on that front.
This event was also a preview of the integration of Frontier Strategy Group and Ducker Worldwide. Ducker has long been active with the Society of Automotive Analysts, with Abey Abraham on the board and SAA President Chris Brower recently joining Ducker. In 2019 Frontier and Ducker will operate as a fully combined company, complete with a newly combined brand. If you are a Ducker or Frontier client, I invite you to share your ideas for how we can bring more value to you by combining our respective strengths in B2B industries, market research methodologies, economic forecasting and scenarios, and international markets.
For our latest updates and insights, FSG clients can visit FrontierView or contact their Client Services Director for more in-depth briefings. Not a client? Please contact us to learn more.