October 29, 2012
In 2012, new passenger car registrations in the EU-15 will decline for the fourth time in a row, falling to their lowest level since 1993. The expected registrations for 2012 are 16% lower than the average for the period 2000-2012. The continued drop in new passenger car registrations is not unique in historical terms. For example, the decline is, on average, less pronounced than the slump in US light vehicle sales recorded in 2008/09. However, car markets such as Spain and Italy (not to mention the miniaturised Greek market) have shrunk dramatically during the last few years. The sustained very low levels in these markets imply a certain backlog demand that could lead to increasing car sales as soon as the economic conditions stabilise. Though a significant increase in new passenger car registrations in 2013 is of course unlikely, the market as a whole could at least reach its trough. The current crisis in the European car market is a huge challenge for European carmakers, in particular for French and Italian manufacturers since they are more heavily focused on their home European market and the highly competitive small cars segment. By contrast, German carmakers (above all the premium segment brands) are benefiting from strong demand in important car markets such as China and the US. Roughly 40% of all German car exports are already heading for countries outside Europe. The broad regional diversification will remain a strategic advantage of the German automotive industry in the near future, even though price competition will increase in emerging markets as well.
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