Hi everyone. Thank you for taking the time to join us today on our webinar. Today, we are privileged to have May Arthapan, our Director of Research & Analysis, who leads GlobalData's activities in the field of light vehicle research and forecasts to guide us through today's Asia-China Automotive Outlook webinar. I encourage any of you to ask any questions during our webinar with our Q&A button, which is conveniently located at the bottom. Any questions that we would not be able to get to, we will get back to you on those afterwards. Towards the end of the session, we will also have a poll to collect your feedback, so please do help us fill that out as well. We will also be sharing the slides and the recording of this session afterwards. Without further ado, I'll pass the time on to May to share with us more on the Automotive Outlook. Over to you, May. Thank you, Irene, for the introduction. Good afternoon, everyone, and good morning to everyone in Europe. I'll be talking about the outlook for Asia-Pacific, excluding China today. I'll get to the update and the latest views on the major markets in the region, and also I'll be covering the impact from the U.S. tariff a little bit too in my session today. I usually like to start my talk with a quick snapshot of how the region is doing for the various key markets that we cover in Asia. As you can see, the region's outlook across Asia, including China, we are looking at a moderate growth of 3%, and that is basically driven by the expansion in China and India. If we are looking at Asia-Pacific minus China, we'll see that the pace slowed down quite a bit, and we are looking at flat production this year compared to last year. Basically, the result will come from the fact that we are looking at no growth in Japan this year and declines in Korea and ASEAN. In Korea and Japan, I think the production will be weak or will suffer from the impact from the U.S. tariff this year, especially next year. I'll go into the detail of that later in my presentation. The reason for the decline this year in ASEAN is slightly different in the sense that we are looking at a very weak market in Thailand and Indonesia, and export is also weakening in Thailand as well. We'll look at the detail for that later in my presentation. Before I go into the market, let's look at the impact from the recent U.S. tariff. For this slide, it basically shows North American light vehicle production, but the chart that I would like to show and that I would like to focus on is if you look at the chart, the bar chart on the bottom right, which shows U.S. sales by source country, you'll see that with the new U.S. tariff, Canada and Mexico will be most impacted because it exports the largest number of vehicles to the U.S. As I probably mentioned in my other presentations or talk before, Japan and Korea will be most impacted following after Canada and Mexico. Japan and Korea will be most impacted by the new U.S. tariff, especially next year, since 17% of U.S. sales are sourced from Japan and Korea combined last year. Let's look at a bit more detail into Japan and what we are, our latest view on the impact. We expect sales of Japanese built vehicles will decrease by around 17%- 18% compared to our pre-U.S. tariff forecast. I think the pause on the 90-day pause on the U.S., on the negotiation, has been extended to the 1st of August. After that, the reciprocal tariff could take effect then. Negotiations are still ongoing. The impact on production basically will be twofold. One is the direct impact on vehicle export from Japan to the U.S., which will now be subject to higher tariffs. The secondary impact will be on the economy itself, both global economy and the Japanese economy, which would impact disposable income and vehicle affordability. For now, we are looking at the impact on production, cumulative impact on production between this year and through to 2028 of around 1.1 million units in Japan. Our previous forecast, which is basically light vehicle forecast of around 8 million or 8.1 million units, now we're looking at 7.7 million each year for the next three years. Next, let's look at Korea. Korea will be severely impacted as well because half of its export goes to the U.S., especially from Hyundai and Kia. Similar to Japan, negotiation with the U.S. is still ongoing, and the deadline of the 90-day pause is also on August 1st. The latest update on Korea negotiation is Korea has hinted that it's quite confident that it could reach a principle agreement with the U.S. by the August 1st deadline. The tariff rate that we are looking at is 25%, which is not confirmed yet for cars and light vans, but for pickup trucks, it will be 50% if the 25% new tariff is imposed. The tariff, whatever rate it is, is basically on top of, it will be on top of the existing tariff. For Korean OEMs, Hyundai will be able to cushion the impact better than Kia, for example, and other Korean OEMs because it will be able to localize more production in the U.S. itself. Its new factory, which has just opened earlier this year, is adding about 300,000 units and potentially could ramp up to 400,000 or 500,000 units. Kia will suffer from the tariff more, and its strategy now is to redirect some of the U.S. bound export to Canada and Europe. In any event, its volume will be, its export from Korea will be negatively impacted. Similar to Japan, we are looking at the impact on export, and that's on production from the U.S. tariff we are looking at. Also, that's the direct impact. We are looking at the impact on the economy and the global economy as well. The impact we are looking at is around 200,000 - 300,000 units a year on Korean production and export. Cumulatively, for 2025 through to 2028, we are looking at about, we reduce Korean export by around 1 million units. In terms of the impact from U.S. tariff, other than Hyundai and Kia, GM Korea will be most impacted because 90% of its exports go to the U.S., and that's 85% of its production in Korea. There is no way of avoiding it. From what I understand, GM Korea also has probably a contract with the union for local production as well. It will be quite hard for it to shift production to the U.S. In terms of investment and technologies, after Hyundai basically backpedaling its previous electrification commitment, for example, the Genesis vehicles and brand no longer commit to full electrification. It has been focusing more on streamlining its technology and platform. Recent development on platform and architecture will be more diversified, electrified architecture, whereby, for example, it's developing a new platform called Trinity, which will be first used on the Genesis models. This platform can underpin both hybrid and BEV platforms, and it's basically planning to adjust, or most of its dedicated BEV platform to accommodate other electrified vehicle models as well. We also expect that some of its ICE platform will last longer in production as well because of the change in the electrification commitment. Also, plans as well, its new new Meta plan in the U.S., its Alzheimer plan will also accommodate hybrid and extended range EV as well. The other key highlights in Korea, even in Korea, we have been seeing and will continue to see more influence from Chinese OEMs such as BYD, which has entered the market and in cooperation with KG Mobility. Chery as well is in cooperation with KG Mobility, and Geely has been partnering with Renault Korea, for example. In terms of sales, the market has been resilient in Korea with booming hybrid sales while BEV sales, which had slowed down earlier, now, but it has started to rebound in Korea. The reason why the market has been holding up well is mainly because the government has been taking active policy actions to prop up demand in the market by providing tax cuts, excise tax cuts for the last few years, and the tax cut has been extended to the end of this year as well. There is also a scrappage incentive in place. In terms of the risk, I think there is, as I mentioned, a risk to the economy overall and the vehicle market from the impact of higher U.S. tariff. It's the exports, as I mentioned, that is at risk. Since the announcement of the U.S. tariff, we have been seeing the impact already on Korean export. April and May export fell by 16% already, and we are looking at a decline of 9% in exports this year. The impact will be more severe next year, and we are looking at - 13% next year. The chart on the right, if you're looking at that, is U.S. sales, sales of Korea-built vehicle in the U.S. It peaked back last year at close to 1.4 million units, but we are looking at a sharp drop of around 8% this year. I think the impact could be as high as 19, 20% of a drop next year. In terms of production, of course, with the falling export, especially for next year, we are looking at the impact to start to see in production later this year, and we're looking at a 6% drop in production this year. The result for this year, while it's a 6% drop from last year, is really not too bad, especially when compared to pre-pandemic production, which is at around 3.9, 4 million units. The impact will be more severe next year, where we are looking at a 7% drop. Depending on how long the tariff will be in place, that could have a lasting impact on production over the longer term. In terms of the impact, it will be on Korea production, but then in terms of the performance of Korean OEMs such as Hyundai and Kia, I think they can plan more investment and production in the U.S. over time. Next, let's look at Japan. The market has been holding up quite well. The market basically rebounded quite strongly so far this year. Sales in the first four months were up 13%, and that's basically a rebound. If you look at the market and sales in Japan, it's been impacted. It's been quite unstable, and there has been a decline in the last three years. That's mainly due to supply issues all along since the pandemic. There has been production disruption from various reasons in Japan in the past three years. The latest one basically being vehicle certification issues at Toyota, Daihatsu, and Mazda mainly, which basically caused some production suspension and disruption. I think in terms of supply issues, it's been mostly resolved. The back orders have been mostly clear, but we are still seeing a long waiting period in the premium segment and for some of the larger vehicles in Japan. Longer term, I think demand and sales will be impacted by more of a demographic issues with aging population and a very mature market. We are looking for sales to decline anyway in Japan. Similar to Korea, export is at risk and quite a major one in a sense. The impact hasn't shown up yet in the latest export results. Export to North America was still up 6% in April, and it's been reported that it still increased in May. We should see the impact from the U.S. tariff soon enough. In Japan, in terms of export, I think there is more concern, especially over the medium and long term as the global market is shifting more towards electrification and BEV and other types of electrification other than hybrid. I think Japanese OEMs could be struggling in terms of export and production, both in Japan and elsewhere, in terms of their competitiveness because Japanese manufacturers have all along focused on other types of electrification and not BEV. For example, it's been focusing on hybrid, which has been doing very well of late. It's benefiting from that. That is bound to change and to end once BEV and battery price come down and BEV affordability increase and the global market and demand shift more towards BEV. That's another concern. In terms of production, it's at risk, especially for next year onwards in terms of the impact from the U.S. tariff. Year-to-date April production is still up 8%, but that's bound to drop later this year with the impact on export. The year-on-year increase that we are seeing so far this year, that's basically partly a result of a low base from a year ago when Daihatsu, Toyota, Mazda had to suspend production over vehicle certification issues that I mentioned earlier. Let's next look at India. Probably the only bright spot with positive things to say this time. The market is still expanding in India, and thanks in part to the high demand for SUV, that segment continues to expand. Lower interest rates, and therefore, lower financing costs should have a further positive impact on vehicle demand from July onwards. This year, I think the agricultural farm sector is a major, a big sector in India, and there is some good monsoon projection this year. Farm income should increase, and there is no drought projection as well. That should be positive on vehicles' demand and sales, especially now that rural sales are the main driver for vehicle sales, with urban sales having been saturated. In terms of politics, the tensions with Pakistan have also eased, and India is not on the list. No direct impact from U.S. tariff. There is likely to be impact on the economy itself, both the Indian economy and the impact from the global economy. India is still one of the top performing economies in the world. Q1 GDP had expanded 6.5% still. There are some negatives in the market to be watched out for. For example, in terms of the vehicle market, high inventory is a concern, especially now that the inventory is rising again a little bit, and especially for the small cars, the A, B, and C segment, not SUV. SUV has been doing well. In terms of the structural issue in India, chronic government and budget deficits, which the country has been running for decades, that's still a concern and kind of limits the country's fiscal capability. All in all, I think India, the market has always had inherent risks in terms of frictions and one-off factors that could impact the economy and the market. It's less stable when compared to the other advanced or more mature markets. This is what I mentioned about a widening gap between wholesale and retail data in India in the last two or three months that has to be watched out for. In terms of production, production is basically tracking sales, and sales have been doing well. While export is expanding, it's still quite small at around 14% - 15% of production. The shipments are mostly to the Middle East, although Suzuki is now exporting some units to Japan. We are looking at around 6 million units of light vehicle production in India this year, and the market and production could be growing. It's likely to be growing very fast, but there is always a downside risk to Indian production. Next, let's look at the Southeast Asian market, which is the weakest market in this region right now, especially in Thailand, the two main markets or production base, which is Thailand and Indonesia. The Thai market has been very weak since last year, mainly due to a deteriorating and very weak economy. The biggest issue in the market is the lack of credit, basically because of the high non-performing loans and default rates. Basically, banks stop lending, especially for big-ticket items like vehicles. Financing, the ratio of vehicle financing is very high in Thailand. It's around 70%- 80%. That basically stalled affordability. Sales this year are very weak, the weakest since 2009. We are looking at around 550,000 units of sales, which is half of its peak. In fact, the market in Thailand could drop to fourth place in ASEAN and could be behind Vietnam, for example, which has been growing very fast. Political problems are an issue with political instability and leadership change and instability. There is no policy measure or stimulus measure to prop up the sector and vehicle demand. There is that gap. In Thailand, there is a large, similar to India, large farming sector, which has been farm output has been low this year, which directly impacts pickup truck demand. In terms of the economy, the tourism sector has been falling as well. Tourist arrivals are declining and tourist income. Basically, that's the last leg supporting the economy. That's partly why the economy has been so weak. There is no direct impact from the U.S. tariff because the country doesn't export a lot of units to the U.S. There will be some impact on automotive parts export and the overall economy from the impact from the U.S. tariff. One of the reasons that the market has been so weak is because of the declining pickup sales in the domestic market and also export to the Middle East as well. The fact that sales of Chinese brands have been rapidly increasing and the expansion of the Chinese OEM presence in Thailand in terms of production as well, that will impact export in the future as well as their production share expands or volume expands because they don't export from Thailand. Their strategy is to still export from China, which is still cheaper than elsewhere because of the scale of production and also especially for BEV because BEV produced in China receives an EV incentive, and the incentive is on production. It applies to export as well. Indonesia, similar issue to Thailand, basically, there is tightening credit, and this impacts vehicle affordability. The domestic economy has been quite weak as well. On average, vehicle price has been increasing at a faster pace of 5% - 7% compared to income, which expanded at around 3.5% on average. While export is expanding, volume is still small in Indonesia. It basically, production relies heavily on the domestic market. The market itself hasn't fully recovered from the payback from the poor head demand during the pandemic. A change in leadership in Indonesia has basically shifted focus more to national security and other things and less focused on the economy, with the leader having a military background. Since in power, there has been legislation change that expands military roles. This negatively impacts consumer and business confidence in Indonesia. In Malaysia, the market was really strong in the last three years up until last year and still early this year because of the tax cut and incentives provided by the government to prop up the market. Very strong, the market was setting new records for three straight years up until last year. The pace is bound to come down now that the incentives expire. There was a planned tax structure calculation change to use open market value as a base for tax calculation, but the change has been postponed from January this year to January next year. There could be a pull ahead in sales in the last quarter of this year. The market may not have slowed down as much as earlier expected. Still, the payback or the market will slow down from next year and more of a normalization rather than a slowdown or decline. In Malaysia, another concern is the long financing period of seven years has now been extended to nine years to prop up demand and sales in the short term. This will have a negative impact over the longer term, whereby it would extend the replacement cycle in the market. That's another concern. Vietnam, sales are booming, and in part, that's thanks to VinFast because of the government support, heavy price cut, and incentives. Because of that, that is a risk. A big portion of VinFast sales goes to government and its own fleet. It has taxi, ride-sharing companies. It supplies vehicles to its own fleet and to the government, and that's a risk to sustainability of the volume. The economy is doing well in Vietnam, backed by strong investment. Vietnam has concluded tariff negotiations with the U.S., and the agreed tariff rate is 20%. I think in terms of uncertainty, it has less uncertainty. Although the higher tariff rate would somewhat impact the economy and exports. In terms of overall sales in Asia and Southeast Asia, as I mentioned, the lack of credit and financing in Thailand and Indonesia are major obstacles to affordability. We are looking at a weak market this year. We expect some market rebound next year, but there is a lot of downside risk to the forecast for next year, both in terms of the economy, the market itself, how the credit market and non-performance loans are doing next year, and also the impact from the deteriorating global economy. In terms of production, production has been weakening due to domestic weakness in Thailand and Indonesia. We have been seeing weakening in the export from Thailand as well. Thailand is basically the only major exporter from the region. Pickup truck export has been weakening because of the weakening market in the Middle East. We are looking at production just under 1.4 million units in Thailand this year. That's very weak. If it falls below 1.4 million units, that's weaker than back in 2020, which is the peak of the pandemic. That's why we are seeing seriously low production this year. Before I wrap up my talk, this is looking at the production volume for Asia-Pacific without China. Basically, we are looking at flat production this year due to declines in production in Korea and ASEAN and flat production in Japan. India is the only production base that we are seeing volume expansion this year. I think this is my last slide. Before I wrap up my presentation, I want to look at our latest view on electrification for the region. This is Asia, again, Asia without China. We are seeing some rebound in BEV sales this year after a slower pace last year. The slower pace or decline in some markets are not specific to Asia. There is a slowdown, a global slowdown in BEV sales globally, partly because of the infrastructure issue, ongoing infrastructure issue in terms of charging infrastructure. Once all the early adopters have bought vehicles, I think battery price and vehicle BEV prices haven't come down enough to attract enough volume or purchase from the mass market to cushion the impact. There is a temporary gap in terms of demand. It's not a bad result or anything. It's bound to happen given the really fast pace of BEV demand in the past few years. In the meantime, hybrid sales have been booming in most markets. This has benefited Japanese OEMs and brands more than others. We have been seeing quite a fast expansion of hybrid in many markets globally, including in the rest of Asia. BEV sales are recovering, rebounding this year. This year, I think we'll be seeing the strongest pace of BEV expansion in India due to, of course, market government incentives and also new products from Indian manufacturers, including Tata, Mahindra, and also Hyundai. From next year onwards, I think Maruti Suzuki, I mean, Maruti Suzuki have been releasing new BEVs in India. I think in terms of volume impact or new products, it would start from next year onwards that we'll see a significant impact on BEV volumes. In terms of that volume in ASEAN and Japan, we are still seeing a lot of volumes on hybrid. That's because of the dominance of Japanese manufacturers, which has been and will continue to focus on hybrid for at least until towards the end of the decade. In Thailand or in ASEAN in general, I think we'll see a faster pace of BEV compared to Japan in a sense that in terms of share because of the Chinese brand being very active in the region, especially in Thailand, but also in Indonesia and elsewhere as well. In Korea, I think Korean manufacturers have been quite advanced in BEV as well, although they have been backpedaling or scaling back their investment and focus on BEV in the short term. I think over the longer term, it's unavoidable that BEV will pick up in Korea as well. Electrified vehicle shares, including all types of EVs, I think that will become very high in Korea, like at 80% towards the end of the decade with high shares of BEV as well and elsewhere in Asia as well, the rest of Asia. I think that's all I have for today. I'll be happy to answer any questions. If there are any questions, let me check in the Q&A. Right now, there's no questions, but I do encourage any participants to maybe, if you could, raise your hand or if you just wanted to type that in the Q&A chat, that's fine as well. I will also be just releasing the poll, so please help us to fill that out as well. We'll just stay here for another five minutes. Any questions, please feel free to post them on the Q&A or to raise your hand, and we can also just allow you to ask your questions. If not, thank you for joining today's.