European OEMs’ performance and 2016 targets
BMW/Daimler aim for record unit sales; VW seeks to stay on par with prior-year
This report outlines six major European OEMs’ 2015 business results, 2016 targets, and midterm strategies.
The combined 2015 unit sales of the six OEMs (VW Group, BMW Group, Daimler, PSA, Renault, and FCA) amounted to 25.42 million units, up 1.5% year-over-year (y/y). The luxury car makers BMW and Daimler achieved new sales records again and Renault reported a growth of 3.3% in its unit sales. While the sales of PSA and FCA increased slightly, VW, which has been rocked by the fallout from its emissions test misconduct, saw a 2.0% decline. By region, all OEMs reported increased sales in Europe that accompanied an economic upturn. The three German OEMs and FCA also saw boosted sales in North America. In China, where the economy has been slowing, sales grew at a sluggish pace, while sales in Russia and Brazil decreased substantially. Among premium brands, BMW maintained its position as a segment leader while Daimler overtook Audi and almost shared the top position because of a significant increase in sales in China.
For financial results, VW’s consolidated sales revenue rose by 5.4% y/y to EUR 213.3 billion while its operating losses were EUR 4.1 billion, which includes the EUR 16.2 billion added to deal with its emissions testing misconduct.
BMW marked record highs with sales revenue of EUR 92.18 billion, up 14.6% y/y, and EBIT of EUR 9.59 billion, up 5.2% y/y. Daimler also reported record revenue and EBIT, with respective increases of 15.1% to EUR 149.5 billion and 22.6% to EUR 13.2 billion.
PSA’s revenue grew by 6.0% to EUR 54.7 billion. Its operating profit significantly increased from EUR 800 million in 2014 to EUR 2.73 billion with reduced fixed costs. Accordingly, PSA reported a net profit for the year after a net loss the year before. Renault’s revenue also rose by 10.4% to EUR 45.3 billion while its operating profit increased by 44.2% to EUR 2.32 billion through cost cutting. Although FCA’s revenue climbed by 18.1% to EUR 110.6 billion, its EBIT fell by 7.4% to EUR 2.63 billion. Its profits were reduced by the impact of unusual expenses, including those for realignment of its production capacity in North America.
According to European OEMs’ forecasts for 2016, automotive markets in Europe and North America are expected to grow slightly, and China is expected to maintain an upward trend. At the same time, the Brazilian and Russian markets are projected to shrink. Within this context, the OEMs set their 2016 targets as follows:
2016 targets of Six European OEMs
|VW Group||VW Group forecasts that the Group’s unit sales in 2016 will be at the same level as the previous year but sales revenue may be down by 5% y/y due to stagnant economies in South America and Russia, negative exchange rates, and the fallout from its emissions testing misconduct. In terms of its operating profit, the Group anticipates an operating return on sales of between 5.0 and 6.0%.|
|BMW Group||BMW Group is aiming to achieve another record for sales volume. The Group’s sales revenue and EBIT are expected to increase slightly. The company’s automotive divisions are expected to have an EBIT margin of between 8.0 and 10.0%.|
|Daimler||Daimler Group expects to achieve further growth in the Group’s unit sales and revenue in 2016. Significant growth is anticipated for the company’s passenger car and van divisions, as well as Asia and Western Europe. However, the rate of growth is likely to be lower than in 2015.|
|PSA||PSA aims to reach an average 4% operating margin for the automotive divisions between 2016 and 2018.|
|Renault||Renault is aiming to increase the Group’s revenue, improve its operating margin, and continue to generate a positive free cash flow for its automotive divisions.|
|FCA||FCA is aiming for Group revenues of EUR 110.0 billion (EUR 110.6 billion in 2015), adjusted EBIT of EUR 5 billion (EUR 4.8 billion), and adjusted net profit of EUR 1.9 billion (EUR 1.7 billion).|
Six European OEMs’ business results
（in millions of EUR/in thousands of units for global unit sales）
|VW||Global unit sales||6,336||7,203||8,265||9,276||9,731||10,137||9,931|
|BMW||Global unit sales||1,286||1,461||1,669||1,845||1,964||2,118||2,247|
|Daimler||Global unit sales||1,551||1,895||2,111||2,198||2,354||2,546||2,853|
|PSA||Global unit sales||3,188||3,602||3,549||2,965||2,818||2,938||2,973|
|Renault||Global unit sales||2,309||2,627||2,723||2,549||2,628||2,712||2,802|
|FCA||Global unit sales||2,152||2,082||3,979||4,223||4,352||4,600||4,610|
|Total||Global unit sales||16,822||18,871||22,296||23,056||23,846||25,051||25,416|
|Source: Press releases and financial statements of the respective OEMs.
(Note) Figures in brackets “( )” represent negative values.