Strong growth forecast for global auto sales in 2021 with Europe strongest, barring anything unexpected.

South Korea’s Hyundai Motor Co and affiliate Kia Motors Corp on Monday forecast combined global vehicle sales will jump 11.5 per cent in 2021 after sliding for two consecutive years.

Their target of 7.08 million vehicles comes after the coronavirus pandemic sent sales last year tumbling 12 per cent to a decade low of 6.35 million vehicles. That result is also more than 20 per cent off a peak reached in 2015.

While the automakers have missed their sales predictions for the past six years, analysts described this year’s target as realistic. Shares in Hyundai Motor also finished 8 per cent higher on Monday, bolstered by investor hopes for strong electric car sales this year.

Hyundai’s Kona Electric has been bright spot for the automaker, with analysts saying sales have been solid despite a global recall after a series of fire incidents.

Kevin Yoo, an analyst at eBEST Investment & Securities, added, however, that while key auto markets such as United States and Europe have begun to put the worst of the pandemic behind them, competition in electric cars is only set to increase.

“Other major automakers are expected to unveil a wave of new EVs in an effort to meet governments’ environment regulations, as well as to catch up with Tesla,” he said.

After the close on Monday, Hyundai said a worker had died in an accident at a South Korean factory. The plant has just been refitted to build a new electric vehicle, the Ioniq 5 - which is set to be Hyundai’s first model using a new EV-only platform.

It was not immediately clear when production will resume.

Meanwhile Tesla Inc shares were set to open at a record high on Monday after the electric-car maker reported better-than-expected vehicle deliveries in 2020, extending a meteoric rally that has seen the stock surge more than 700%.

It delivered 499,550 vehicles last year, above Wall Street estimates of 481,261 vehicles, according to Refinitiv data, but 450 units short of Chief Executive Officer Elon Musk’s target.

“We are raising our forecasts to reflect higher 4Q deliveries and reports of strong demand for the Model Y in China, which is also suggestive of higher future deliveries,” JP Morgan analysts said in a client note.

Tesla has reported profit in five straight quarters, defying last year’s auto industry trends of slumping sales, quarterly losses and global supply chain disruptions.

Shares of the company, which joined the benchmark S&P 500 index in December, were up 3 per cent in premarket trading.

Shareholders in Peugeot owner PSA gave the green light on Monday to the French company’s merger with Fiat Chrysler (FCA), one of the last steps towards creating the world’s fourth largest automaker.

At a special shareholder meeting, the deal to form the new company called Stellantis was first backed by top investors with double voting rights, including the Peugeot family, China’s Dongfeng and the French state, via Bpifrance.

All other PSA shareholders backed the deal at a second meeting held online with a 99.85% approval rate among votes cast. FCA investors are due to give their verdict later on Monday.

“We are ready for this merger,” PSA Chief Executive Carlos Tavares said, adding that the date for the closure of the deal would be announced shortly if all shareholder approvals were granted. He said the deal had now passed all regulatory tests.

The shareholding structure will be altered as part of the merger, and existing double voting rights - which are accrued over time and give investors more weight in decisions - will not be carried over.

Tavares, who will take the helm of the merged group, will have to revive the carmaker’s fortunes in China, rationalise a sprawling global empire and address massive overcapacity, as well as focus like rivals on creating cleaner cars.

Stellantis will have 14 brands, from FCA’s Fiat, Maserati and US-focused Jeep, Dodge and Ram to PSA’s Peugeot, Citroen, Opel and DS. PSA has traditionally been more focused on Europe.