German firms increase US market shares – bonuses boost West European market

International passenger car markets continue recovery

Berlin, 16 March 2010. In February 2010 the demand for passenger cars increased again on the most important foreign markets. For example, China, India, Japan, the US and Brazil recorded clear rises in sales of new cars. In some Western European countries demand benefited from the continuing effects of various economic stimulus programs. By contrast, sales in Eastern Europe were more sluggish in their developments.

The number of new registrations in Western Europe went up by 5 per cent. Not including the German market, which shrank last month by almost 30 per cent after the inflated figures in February 2009 due to the bonus scheme, passenger car sales in Western European countries actually grew by a fifth. In France the extended environmental bonus scheme pushed demand up by 18 per cent last month. In the UK – which has a state incentive scheme for purchasing new cars up to the end of March – sales rose by more than a quarter. And in Italy the positive effects of the environmental bonus (that was wound up at the end of 2009) are still in evidence because the scheme applies to new registrations up to the end of March. In February the Italian market chalked up an increase of around one fifth in newly registered passenger cars. In Spain car sales were up by 47 per cent despite the continuing weak development of the economy in general, but sales there had been at a very low level one year before. In the first two months of this year just over 1.9 million passenger cars were sold in Western European countries, which was around 10 per cent more than in the same period in 2009.

In the new EU Member States, on the other hand, February sales dropped by 22 per cent to 51,700 vehicles. The trends in the passenger car business still vary widely from one market to another. The Czech Republic (+13%), Slovenia (+2%) and Slovakia (+5%) were the only countries to improve their sales of new cars last month. In the other states the market was still not showing signs of a consistent recovery. This year so far demand for passenger cars has fallen by 23 per cent in the new EU Member States.

Russia’s February sales slumped by nearly 32 per cent to 91,900 units. This means that since the beginning of the year around one third fewer vehicles were sold on the Russian market than in the same month last year. The introduction of a bonus for end-of-life cars at the beginning of March should revive demand for passenger cars to a certain extent, but it only applies to the purchase of new cars built in Russia.

In February the US market remained on course for recovery and recorded a 13 per cent increase, which was the fifth rise in succession. Following the collapse of more than one fifth in the sales of light vehicles (passenger cars and light trucks) in the US in 2009, sales of these vehicles totaled nearly 1.5 million units in the first two months of 2010, reaching a level 10 per cent above that of the previous year. Sales of German brands increased by 21 per cent, growing much more strongly than the market as a whole, so that the total share of the light vehicles market going to German manufacturers rose to around 8 per cent. The German OEMs pushed up their share of the passenger car market to 11.7 per cent, and in light trucks they increased their sales by more than one third, while this segment as a whole expanded by only 4 per cent.

In Brazil a good 10 per cent more light vehicles were sold in February 2010. This means that this year the Brazilian automobile business has also continued to expand and since January demand has gone up by 8 per cent to 413,000 vehicles.

The passenger car market in Japan has also exhibited fairly dynamic development in recent months. In February the number of newly registered vehicles reached 395,600, so sales were up by more than a fifth. The Japanese Government had already approved an extension of its economic stimulus measures at the end of last year, and Japanese car-buyers can therefore continue to benefit from tax breaks and an environmental bonus up to the end of September. The number of new registrations rose by 23 per cent in the first two months of the current year, to almost 715,400 passenger cars.

In China sales of passenger cars soared by over 51 per cent in February – despite the week-long New Year celebrations. Since 1 January, 2010 the Chinese passenger car market (not including minibuses) has expanded by a good 85 per cent to nearly 1.8 million vehicles. This means that since the start of this year China has become the world’s largest sales market, with a volume currently one fifth greater than the US market.

Last month business in new cars in India also showed a strong rise of 34 per cent. In January and February over 382,000 cars were sold on the Indian market, i.e. about 35 per cent more than in the previous year.