Geneva Motor Show: German manufacturers have numerous premieres – Western Europe makes modest recovery
Statement delivered by VDA President Matthias Wissmann at the VDA’s press conference in Geneva on Monday, March 2, 2015, at 17.00 h
Ladies and Gentlemen,
It is my pleasure to welcome you most cordially to our press conference as the Geneva Motor Show kicks off.
The automotive year 2015 has got off to a good start. China and the US market showed double-digit growth in January, and Western Europe expanded by a good 6 percent. So the three large key markets are developing dynamically. It is pleasing to see that in January all five large passenger car markets in Western Europe have increased, some of them with growth in double figures. This makes us optimistic.
Yet it is also clear that the worldwide crises are causing political and economic uncertainties.
Sustainable growth requires resolution of the political conflicts and the right overall industrial policy. There is still plenty to do in Europe and not only in relation to Greece. Promoting competitiveness must be the EU’s main focus during the coming years. This includes consistent consolidation of Member States’ budgets along with a proactive economic and industrial policy on the part of the Commission, which is based on market-economy principles.
We expect that over 2015 as a whole the global passenger car market will increase by 2 percent to 77.4 million units. That represents growth of one quarter compared with 2010 (61.7 million).
Light vehicle sales in the US will rise by 2 percent to 16.7 million units in 2015, which will very nearly complete the process of returning to the pre-crisis level. Furthermore, China is now not very far off the 20 million mark. This year we expect a volume of 19.5 million passenger cars, corresponding to 6 percent growth.
The Western European passenger car market will also move forward in 2015, although at a reduced speed. If we see a volume of 12.3 million units at the year’s end, that will be a year-on-year rise of 2 percent. There is actually even more potential here because Western Europe will then still be 2.5 million units below its pre-crisis level (14.8 million in 2007).
Looking around the world, there are two likely disappointments: Brazil will not get into forward gear in 2015, and the Russian market will shrink by almost one fifth, according to our current estimates.
German home market increases in February
This brings me to the German market – and the very latest figures. In February, new registrations of passenger cars rose by 7 percent to 223,300 units, so in the first two months of this year we have recorded a 5 percent increase in new cars to 434.600 units.
Over the entire year we will have a stable number of new registrations in Germany, exceeding 3 million, i.e. a modest improvement on the 2014 result (3.04 million).
Overall, Ladies and Gentlemen, this means that we have good conditions for the “automotive spring,” which traditionally begins here in Geneva.
Exciting premieres by the German manufacturers
And our manufacturers have come to the shores of Lake Geneva with some exciting premieres:
- Audi has brought its new R8 super sports car, for the first time also in a purely electric version, the RS3 compact sports car and the plug-in hybrid Q7 e-tron, which is especially economical on diesel fuel.
- BMW is showing its new seven-seater 2 Series Gran Tourer and the new 1 Series. BMW is entering a completely new segment with the 2 Series Gran Tourer.
- Ford’s presentation at Geneva comes under the slogan “Performance Cars” and includes the sporty Focus RS with all-wheel drive, and the Ford GT, the Focus ST and the Ford Mustang. Furthermore, the next generation of the Ford S-MAX is on display.
- Mercedes-Benz has come to Geneva not only with the Mercedes-Maybach Pullman, but also the new C-Class as a plug-in hybrid and the CLA Shooting Brake, which will also be available with AMG. In addition, the AMG GT3 will be on show.
- Opel is presenting its nippy “Karl,” a new, keenly-priced five-door model for first-time buyers in the micro car segment. The Corsa OPC demonstrates the sporty side. And with the market launch of the Opel OnStar, the company is also taking the next consistent step toward vehicle connectivity.
- Porsche is kicking off with top-flight sports models, and one of them is the GT4 version of the Cayman.
- Volkswagen has brought its new Caddy and the new version of its Touran compact van. The company is showing off its sporty side with the Golf R Variant and the high-torque Golf GTD Variant. The Passat series is also being expanded – with the addition of the all-wheel drive all-rounder “Alltrack.”
To summarize: in Geneva the German brands are showing that they cover the complete range of automotive competence, which spans super sports cars and comfortable SUVs and station wagons, all the way to nimble small cars. We are present in every niche. And the vehicles are becoming more and more economical in all segments; on the one hand this is due to ever more efficient conventional engines, and on the other to alternative drive trains.
When it comes to CO2 reduction, we have made good progress over recent years. In 2014 the average CO2 value of passenger cars newly registered in Germany was 132.1 grams per kilometer. That corresponds to consumption of only 5.4 liters to travel 100 kilometers (according to the NEDC). But everyone also knows that another tangible reduction will be possible only with a considerable contribution from alternative propulsion systems.
Electric mobility: German brands are in pole position
Here in Geneva, too, it is evident that electric mobility is already a reality: the German manufacturers have electric models on offer, primarily as plug-in hybrids. This answers the question of vehicle range – and one can also drive around town with zero emissions.
Yet it will still not be sufficient if we, the providers, enjoy pole position today and our manufacturers launch 29 e-models onto the roads by the end of 2015. If Germany is also to develop into the leading market for electric mobility, policy-makers in particular will have to institute the right measures rapidly and decisively.
One effective lever would be 50 percent depreciation in the first year for commercially used electric vehicles. The special depreciation would stimulate purchases among the fleet managers and thus tangibly support the ramp-up of electric mobility.
We see here a market-economy instrument that has proven its value since the time of Ludwig Erhard. And of course depreciation would be reset to the linear method after a certain period of time. In respect of the total time period, by the way, the losses for the Minister of Finance would be close to zero, especially with today’s low interest rate.
Connected and automated driving is powering innovation
The second driver of innovation is connected and automated driving. We understand this as the consistent ongoing development and integration of the numerous driver assistance systems in cars. The process is taking place in several stages, from partially automated driving to highly automated and then all the way to fully automated driving. The initial applications will be available for congestion and freeway scenarios.
In terms of technology, today it would already be possible to implement partially automated driving in stop-and-go traffic or in congestion on the freeway, i.e. the driver would always have responsibility for the vehicle. However, until now the maximum speed for this type of operation has been limited to 10 kilometers per hour by UNECE 79 – an international technical approval regulation for steering equipment. The first step now is to alter the regulations to allow partially automated driving functions. For the realization of highly automated driving, a legal framework needs to be created in the national legislations, for example in the German Road Traffic Regulations (StVO). Ideally, these frameworks should be harmonized internationally, which would be relevant to cross-border traffic. But it is going to be several more years before cars are able to drive on rural roads or in urban areas in highly automated mode – that is, with the driver able to turn his attention to other activities, although he will still sit in the front left seat. However, this is no longer science fiction but a very realistic prospect.
So in parallel to these technical developments, what is needed is to expand and formulate the legal framework for all this to happen. To this end, we are holding intensive discussions with the German federal authorities and the European Commission. And we welcome the fact that Federal Transport Minister Dobrindt is tackling the topic proactively, as shown by the freeway A9.
Ladies and Gentlemen, let us get back to the figures. In the first two months of this year, production and exports were indeed down slightly (by 5 percent in each case). But at the same time, orders both from the home market and from abroad were climbing: by the end of February orders from Germany had risen by 5 percent, and orders from other countries by 8 percent.
At the end of 2014 our companies had a regular workforce of just over 781,000 employees. That is growth of 20,000 jobs (+3 percent). At the suppliers alone, the regular workforce increased by more than 6,000 to nearly 298,000 employees (+2 percent).
Over the entire year 2014 turnover in the German automotive industry set a new record of 385.5 billion euros. Earnings therefore rose by almost 7 percent in comparison with 2013.
For 2015 as a whole, we expect production at home to reach 5.7 million passenger cars (+2 percent), and exports to reach 4.4 million cars, which would also be growth of 2 percent.
This means that three out of four cars built in Germany are destined for export. Our export strength is therefore also important for the employees in Germany.
Here are the facts for 2014:
- Half of all cars exported (51 percent) go to Western Europe;
- One car in seven (14 percent) goes to the US;
- One car in sixteen (6 percent) goes to China.
So 71 percent of our entire export business is generated on the three large markets of Western Europe, the US and China.
Asia and America are strategically important, above all for the export of premium vehicles – Europe is a volume market
If we look at exports – broken down by individual segment – an interesting picture emerges:
- More than one third of all passenger cars exported from Germany (36 percent, or 1.5 million units) are small cars and vehicles in the compact class (e.g. Mercedes A-Class, VW Golf, Ford Fiesta, BMW 1 Series). This equals more than one quarter of production at domestic plants. And 75 percent of this basic industrial output is exported to states in the EU
- Nearly one quarter of exports (23 percent, or 992,100 units) is made up by the medium segment (e.g. Audi A4, Mercedes C-Class, BMW 3 Series). Of these, about half (47 percent) go to the EU-28, while a good fifth (22 percent) are destined for NAFTA. A large proportion of the vehicles for the Chinese market are already produced locally
- Twelve percent of Germany’s exports (496,300 units) are in the upper medium segment (e.g. Mercedes E-Class, BMW 5 Series, Audi A6). Of these, almost one third (31 percent) are already destined for NAFTA, 30 percent goes to the EU-28, and 28 percent goes to Asia.
- The luxury segment (e.g. Mercedes S-Class, BMW 7 Series, Audi A8) accounts for 5 percent of all passenger car exports (235,600 units). A whole 37 percent of them are bound for China, a good quarter (26 per cent) go to NAFTA, and more than one fifth (22 percent) go to Asia not including China – but only ten percent go to the EU-28.
The German automotive industry has a very competitive mixture of volume and premium vehicles. This safeguards production and employment in Germany. And it is clear that exports overseas would pose a bigger challenge without a healthy European market that ensures a basic level of capacity utilization and thus competitive production capacities especially in the smaller segments.
But we also need free access to markets in North America and Asia: six out of ten vehicles exported in the upper medium segment go to those regions.
This is even more marked in the luxury segment, where 85 percent of new cars exported go to either North America or Asia. The luxury segment cannot survive on the EU countries alone – only one car in ten in this segment goes to a customer in the EU.
Given these relations it is evident why we are so keen to back free markets, and especially the Transatlantic Trade and Investment Partnership (TTIP): because Germany as an automotive location – and the premium segment in particular – is strategically dependent on the large markets in the US and China. And it also becomes clear why we are so strongly in favor of strengthening the competitiveness of our European partners. A robust European industry secures employment and prosperity – and strengthens this “home market” that is also important for us.
|February 2015||January - February 2015|
|Passenger Cars *)||Units||Change
15/14 in %
15/14 in %
|German makes incl. group makes||163.500||9||318.500||6|