Sales booming in China and India – car sales rise further in Western Europe
Demand for Automobiles Continues to Increase in Key Foreign Markets
Frankfurt am Main, August 14, 2009. The demand for passenger vehicles rose worldwide in July as a result of various incentives and more stable economic conditions. Car sales increased especially strongly in the Asian growth markets, and there are also noticeable signs of an upswing in many European countries. As a result, automobile sales continued to stabilize in key foreign markets in July.
Sales in France rose by 3 percent in July, pushing new vehicle registrations for the first seven months of 2009 to a level slightly above that posted during the same period last year. In Italy, car sales rose by slightly more than 6 percent. However, for the year to date, sales are still 8 percent lower than in the same period last year. In the UK, sales of 157,100 passenger vehicles in July represented the first increase (+2 percent) in new vehicle registrations since April 2008. More than half of this increase was posted by German brands. Although new vehicle registrations in Spain were once again below last year's level in July (minus 11 percent), the drop in sales has been bottoming out more and more over the past three months.
In Western Europe as a whole, passenger car sales rose in July for the second month in a row, increasing by 5 percent to 1.2 million units. However, new vehicle registrations for the year to date are still almost 8 percent lower than in the same period last year. The German manufacturers were very successful in many countries and increased their market share by nearly a full percentage point to more than 47 percent. The markets in Western Europe continue to be boosted by numerous national scrappage programs. This was particularly the case in Germany, which saw sales continue to boom in July as a result of the scrappage program (+30 percent). But even if these figures are excluded, the Western European market contracted only slightly (2 percent) last month.
Sales in the new EU member states are also showing signs of slowly bottoming out at a low level. Although passenger car sales in Eastern Europe were still substantially below last year's level in July (minus 21 percent), they were slightly higher than in June after adjusting for seasonal effects. Growth was posted in Slovakia (+39 percent), the Czech Republic (+9 percent) and Poland (+5 percent), while the other Eastern European markets suffered double-digit sales decreases in July as well.
The Russian car market meanwhile shows no signs of ending its decline. Following another sales slump of 58 percent in July, the former growth market has contracted by half since the beginning of the year. To help support the country's automotive industry, the Russian government now plans to introduce a scrappage program with a cash incentive of 50,000 rubles (approx. €1,100) for the purchase of a new, Russian-made car.
In the U.S., the cash-for-clunkers program introduced in the last week of July quickly helped counter the downturn of the previous months in the market for light vehicles. Although the sale of almost 1 million vehicles in July was still 12 percent lower than in the same month of 2008, the decrease was far less pronounced than in the first six months of this year. Because the funding for this program has now been increased to $3 billion, demand is expected to improve substantially in the coming months. A total of 5.8 million light vehicles (-32 percent) were sold in the U.S. from January through July. The German automakers increased their market share in the country by almost one percentage point to 7.3 percent.
At 273,600 units, the number of new light vehicles registered in Brazil in July was slightly above the value posted in the same month last year. A total of 1.7 million vehicles have been sold in the Brazilian market since the beginning of the year (+4 percent). The automotive industry has been boosted in the past several months by government tax incentives that were originally scheduled to expire at the end of June but have now been extended to the end of the year.
Passenger car sales also did well in Asia in July. Although the sale of 372,400 passenger vehicles in Japan in July was still 3 percent lower than in the same month last year, the country's market is also increasingly showing signs of stabilizing. After adjusting for seasonal effects, sales rose by 12 percent in July compared to the previous month.
The automobile market in China continues to pick up pace. New passenger vehicle registrations in China rose by 64 percent in July to 678,000 units, thereby increasing total sales by about 25 percent since the beginning of the year. The Indian car market also experienced a boost in July, growing by 29 percent to 148,000 vehicles. For the year to date, sales have risen by 6 percent.
