Moody's raises global car sales forecast on China strength

Moody's has raised its forecast for global light vehicle unit sales in 2010 to 65.3 million, up 2 percent year on year, the rating agency said in a report released Thursday.

That was followed by a forecast of 70.2 million for 2011.

The upgrading came after unit sales of passenger cars and light commercial vehicles grew by an unexpected 48 percent to 13.0 million in 2009.

Moody's upgraded its forecast for the Chinese market to 14.3 million in 2010 and 15.7 million in 2011, up from 11.8 million and 12.9 million, respectively.

"We expect the Chinese light vehicle market to remain on a growth path for the next two years with demand rising 10 percent each year driven by accelerating GDP growth and the still-low level of auto ownership," the report said.

Moody's said it expected new registrations to increase 10 percent in the United States, where light vehicle unit sales have fallen 40 percent from their peak of 17.5 million in 2005 and reached a trough in 2009.

European light vehicle registrations, however, may fall by 15 percent due to the pull-forward demand triggered in 2009 by scrapping incentive schemes.

Japan was likely to experience a slight improvement, it added.