TPT July 2020

G LOBA L MARKE T P L AC E

Overall sales of passenger cars in the wider European Union, UK and European Free Trade Association (EFTA) countries fell by 52.9 per cent in the same period. The ACEA data revealed that, of the 3,054,703 new cars registered during the first quarter, 80 per cent were combustion-engined. Car showrooms in Germany, usually Europe’s largest car market, reopened in late April but, according to German dealership association ZDK, demand was less than half that of the same period in 2019. ZDK spokesman, Ulrich Koester, said: “There are between 750,000 to one million unsold cars sitting in German dealerships. The vast majority of them are conventional petrol and diesel cars.” The high inventory of traditional engined cars is expected to make it harder to sell electric and hybrid vehicles. Electric car sales in the EU, UK and EFTA countries reached 130,297 between January and March. In terms of new electric car registrations, Germany saw a 63.3 per cent rise; France was up by 145.6 per cent, and Norway’s registrations declined by 12.4 per cent. The EU is demanding that carmakers cut carbon dioxide (CO 2 ) emissions by 40 per cent before 2021, and a further 37.5 per cent by 2030. Average emissions from new cars should not exceed 95 grams of CO 2 per kilometre by 2021. According to the European Environment Agency, in 2018, the latest year for which statistics are available, the total was 120.4 grams per kilometre. Carmakers are developing new electric and hybrid models to help meet the targets, but analysts at PA Consulting have forecast that, based on 2018 emissions, manufacturers will need to sell over 2.5 million extra electric cars by 2021 – a sales increase of 1,280 per cent. Although ACEA statistics show quarterly sales of plug-in hybrid cars rose by 126.5 per cent to 97,913 vehicles, with Germany again leading the way with a 258 per cent increase to 26,419 cars, the scarcity of charging infrastructure will continue to depress sales. Forecasters at LMC Automotive doubt electric sales will overtake combustion-engined sales before 2030. And in Russia, the electric car continues to be a rare sight Figures from the Association of European Businesses (AEB) showed sales of new cars in Russia fell by 72.4 per cent in April, compared with the same period a year earlier. The 38,922 new cars and light commercial vehicles sold in Russia during April represent the biggest monthly sales fall ever recorded by AEB and follows a 4 per cent rise the previous month. The most popular brand Lada, manufactured by Avtovaz, accounted for around 25 per cent of April sales. Termed “Black April” the month, “…strongly challenged dealer liquidity and, mid-term, even their sustainability,” said Thomas Staertzel, chairman of the AEB Automobile Manufacturers Committee. “Dealers are preparing for a restart, although I do not expect much better sales results in May.”

Automot i ve China’s increased interest in electric vehicles has prompted weaker sales in fossil-fuelled cars By mid-April poor sales had forced Renault SA to make the decision to close its main passenger car business in China, a venture with Dongfeng Motor Group. Car sales within China, the world’s biggest vehicle market, were slowing even before the pandemic, putting increased pressure onto manufacturers struggling to make an impression. In 2018 the Japanese automaker Suzuki Motor Corp sold its stake in a venture with Changan Automobile in the wake of disappointing results. The Renault/Dongfeng venture sold only 18,607 cars in 2019, well below its annual capacity of 110,000, and reported an operating loss of over $212mn. Dongfeng has taken Renault’s 50 per cent stake in the business, and has plans to upgrade the venture’s existing car plants. Although Renault’s French rival PSA is leaving a small joint venture with China’s Chongqing Changan Automobile, having recorded a loss of €700mn in China in 2019, Renault is one of only a few global carmakers to abandon a major project in China. Renault will maintain a presence in China with other ventures, such as electric vehicles in a venture with Jiangling Motors Corporation, and Renault and Dongfeng will continue to cooperate on “connected vehicles” and work with common partner Nissan Motor Co Ltd on engine development. Renault will also maintain its light commercial vehicle business with Brilliance China Automotive Holdings, with a view to launching five new models before 2023. In a statement Francois Provost, Renault’s chairman for the China region, said: “We are opening a new chapter in China. We will concentrate on electric vehicles and light commercial vehicles, the two main drivers for future clean mobility and more efficiently leverage our relationship with Nissan.” According to data from the automotive consultancy LMC Automotive, although overall auto sales in China plunged 43.4 per cent during March, Tesla’s Chinese car registrations jumped 450 per cent in the same period. Tesla, now selling several models from its Shanghai factory, sold 12,709 units in March compared with just 2,314 in February.

Within Europe, electric cars have a cooler reception

In mid-May, data from the European Automobile Manufacturers Association (ACEA) showed registrations of electric cars in Europe jumped 57.4 per cent in the first three months of 2020, but still accounted for only 4.3 per cent of total registrations.

Gill Watson Features Editor (Europe)

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JULY 2020