LMC Automotive European Passenger Car Sales Update (May 2020)

2020/06/09

Summary

  • West European car registrations fell by 57.3% year‐on‐year (YoY) in May, while the regional selling rate stood at 6.3 mn units/year. Although the region shows some improvement from the unprecedented fall in April, the automotive industry is still in the midst of a deep crisis and it remains clear that the spread of COVID‐19, and associated lockdowns, continue to dominate the region’s woes.
  • French registrations contracted by 50.3% YoY, with the monthly selling rate reaching 1.2 mn units/year. The Italian selling rate was 1.0 mn units/year, or a 49.6% YoY fall in sales. In the UK, with dealerships closed, registrations fell by 89.0% YoY to just over 20k units. German sales contracted by 49.5% YoY in May, with a selling rate at 1.9 mn units/year. Spanish car registrations managed just 34k units for the month, marking a drop of 72.7% YoY.
  • The impact of the COVID‐19 coronavirus has continued to transcend any other concerns in the West European automotive market. As we look ahead, we are paying particular attention to any new government incentive schemes, as well as wider economic relief. Our outlook remains similar to last month’s report, with a 26% contraction expected in 2020 for the region as a whole. This echoes our expectation of gradual recovery in H2 2020 spurred on by improving consumer activity as lockdown measures continue to ease.



Commentary

  West European car registrations were down 57.3% YoY in May, showing some recovery from April’s record breaking low. The selling rate was 6.3 mn units/year, up from 2.8 mn units/year in the previous month as the coronavirus pandemic and associated lockdown continue to dominate the current situation. The modest improvement in last month’s registration results versus April comes alongside the easing of lockdown measures. We expect selling rates will be on a generally upward trajectory over the second half of the year, supported by lockdown measures easing and vehicle plants resuming activity.

  However, there are clear upside and downside risks. On the upside, the implementation of incentive schemes by governments, such as that planned for France, could create a boost to consumer demand, though, schemes announced so far do not appear to have the transformative impact on vehicle sales we saw during the Great Recession. On the downside, a second wave of coronavirus cases and the deployment of strict lockdown measures could have grave consequences for automotive sales activity.

  Country‐specific diversity is apparent across the region in the latest results. In France, registrations fell by 50.3% YoY, to 96k units in May — the recent announcement by the French government to provide specific auto sector aid will certainly boost demand, though it will not completely transform market volumes. The German economic package sees a lowering of VAT and, specific to the auto sector, a focus again on BEV/PHEV support rather than a larger broad‐based boost as we saw back in 2009 — German registrations fell 49.5% YoY last month. With dealerships remaining closed, the UK saw another extraordinary fall in sales last month, with a contraction of 89.0% YoY. In Italy sales fell 49.6% YoY, with a selling rate of 1.0 mn units/year. Finally, Spain experienced another sharp 72.7% YoY fall in sales, registering just 34k units in May. Further state aid in the region can be expected, though details will vary country by country, and recent announcements point to more modest schemes than some would have hoped.

Western European Passenger Car Sales Update


Sales (Units) Selling Rate (Units/year)
May
2020
May
2019
Percent
Change
YTD
2020
YTD
2019
Percent
Change
May
2020
YTD
2020
Year
2019
Percent
Change
WESTERN EUROPE
556,775
1,304,028
-57.3%
3,559,611
6,304,868
-43.5%
6,324,161
8,506,890
14,293,141
-40.5%
AUSTRIA
20,309
30,648
-33.7%
86,435
143,772
-39.9%
226,263
205,059
330,271
-37.9%
BELGIUM
34,752
51,081
-32.0%
167,465
260,443
-35.7%
402,013
402,116
550,004
-26.9%
DENMARK
11,432
19,070
-40.1%
70,493
101,514
-30.6%
125,838
166,428
225,596
-26.2%
FINLAND
5,110
10,891
-53.1%
39,354
49,742
-20.9%
57,514
85,373
114,202
-25.2%
FRANCE
96,310
193,948
-50.3%
481,989
935,480
-48.5%
1,153,618
1,181,948
2,214,296
-46.6%
GERMANY
168,148
332,962
-49.5%
990,430
1,523,769
-35.0%
1,931,548
2,445,587
3,607,258
-32.2%
GREECE
4,298
13,915
-69.1%
23,828
50,164
-52.5%
32,935
63,740
113,684
-43.9%
IRELAND
1,751
6,320
-72.3%
53,429
79,350
-32.7%
30,840
58,206
117,098
-50.3%
ITALY
99,711
198,020
-49.6%
450,637
911,399
-50.6%
1,015,545
961,301
1,916,092
-49.8%
LUXEMBOURG
1,926
5,415
-64.4%
15,030
25,924
-42.0%
20,385
34,792
55,008
-36.8%
NETHERLANDS
14,934
36,601
-59.2%
133,974
184,694
-27.5%
207,860
309,326
447,573
-30.9%
NORWAY
7,998
13,117
-39.0%
47,781
62,857
-24.0%
92,131
115,457
142,381
-18.9%
PORTUGAL
5,741
22,724
-74.7%
53,772
103,241
-47.9%
59,661
124,050
223,648
-44.5%
SPAIN
34,337
125,613
-72.7%
257,207
561,898
-54.2%
358,313
613,230
1,258,259
-51.3%
SWEDEN
15,881
31,919
-50.2%
100,938
136,052
-25.8%
179,352
253,370
355,165
-28.7%
SWITZERLAND
13,890
28,060
-50.5%
78,724
128,745
-38.9%
159,986
198,777
311,466
-36.2%
UK
20,247
183,724
-89.0%
508,125
1,045,824
-51.4%
270,359
1,288,129
2,311,140
-44.3%
Notes:

Greece & Luxembourg data: estimate for latest month.
Greece data source has changed to Sales from Registrations.
The percent change in the final column compares the average selling rate in the year-to-date with the last full year.
The average of the seasonally adjusted selling rate for an entire year is by definition the total of sales in the year.