Fitch Ratings' Neutral Outlook for the Global Automotive Sector in 2025

Fitch Ratings recently announced a "neutral" outlook for the global automotive sector in 2025, projecting a modest 2% increase in light vehicle sales. While growth is expected in some regions, challenges in Europe and China due to macroeconomic pressures will result in uneven gains.

Competitive pricing and protectionist policies are anticipated to strain profitability further. "Most global OEMs and tier-1 suppliers have localized production, but manufacturing and supply chains in Mexico and Canada could face additional tariffs under Donald Trump's presidency," the agency said.

Electric vehicle (EV) sales are expected to remain flat in the US and Europe, hindered by range concerns and residual value depreciation. Chinese markets are likely to see continued EV growth.