TOKYO (Bloomberg) -- Renault-Nissan CEO Carlos Ghosn said he expects Europe's auto industry to take many years to recover from shrinking demand and excess capacity.
Nissan is "preparing for many mediocre years" in Europe, Ghosn said today during a Bloomberg Television interview in Hong Kong. But while Europe faces overcapacity, the region "will not see any kind of Armageddon," he added.
New-car sales in Europe have collapsed to their lowest level in 17 years, as the sovereign debt crisis saps demand amid rising unemployment and slowing economic growth.
Last month, business consultants AlixPartners forecast that the European auto market won't return to pre-crisis levels until the end of the decade as the euro crisis and high unemployment continue to undermine consumer confidence.
Western Europe will see demand for new passenger cars and light commercial vehicles fall by about 1 million next year to 13.5 million, which is 3.3 million units below the sales level seen before the financial crisis hit in 2007, according to the consultants.
Southeast Asia, U.S. growth for Nissan
Nissan will manage its capacity in Europe to match demand, Ghosn said in today's interview. The carmaker plans to build more than 5 million cars this year, Ghosn added, with growth coming from Southeast Asia and the United States.
"Myanmar may be the star of future" along with Indonesia and Vietnam, Ghosn said.
The CEO, who is also head of French carmaker and Nissan alliance partner Renault, said he hopes the new Altima midsize sedan will take "top position" in the United States, where the industry continues to recover.
While Japan's second-largest automaker is expanding output capacity in Southeast Asia, the strong yen is deterring the carmaker from expanding production at home, Ghosn said.
Automotive News Europe contributed to this report
