In the last eight years Italian cars and heavy vehicles export value has increased by about 140% (12% on annual average). This recovery is the result of the growth in world demand after the crisis of 2008-2009, which was associated with the recovery of the cycle of consumption of durable goods and that of national production levels, stimulated by the FCA Group's investments in Italian plants, with the conversion to mid-high-end cars, which have also been the driving force for the components sector.
Looking at the historical dynamics (Figure 1), the driving role of the Chinese market is clear, moving from 1.1% of the total national exports in 2010 to almost 7% in 2017.
In terms of percentage increase, this is almost a 50% annual average growth over the period considered, with the traditional target market, Western Europe, which increased by 8% a year, losing representativeness.
Also the US market gained a significant share and benefited from the integration process, started in 2009 between Fiat and Chrysler. Since 2014, America has become the first destination country for national exports, surpassing Germany and France that were permanently at the top.
The situation is a bit different for components (Figure 2), where European markets retain their centrality, mainly Germany (with 22% of value flows). Also for this sector the Chinese market has progressively gained relevance (+ 15% the average annual growth of exports in China, compared to + 6% total), with a still very limited representativeness.The need of overseeing the automotive supply chain in China, for national component manufacturers, is also represented by the fact that the future of electric cars will be played on the Chinese market.
So, in addition to the reduction of duties announced for July 1 both on vehicles and on components, the recent signs of detente coming from Beijing include the commitment to cancel the 50% limit for foreign companies in joint-ventures (already this year for electric cars), they are excellent news for Italian producers. Positive innovations that risk being canceled by the opposite signals that could come from the US market.
If the signs of China's refusal show that they want to prevent a possible protectionist escalation, the Trump administration has recently launched a national security survey on car imports that could lead to the introduction of new tariffs similar to those imposed on steel and aluminum imported in March. We will know shortly how the round for trade barriers will end, the result of which will have significant consequences on Italian export.