VDA increases forecast for China – Global car market set to reach 80 million for first time – Efficient diesels necessary for action on climate – Incentives needed for e-mobility
“We are confident, coming to the Geneva International Motor Show. The German automotive manufacturers are bringing exciting world premieres to Geneva. In addition, the economic situation in Europe is providing support: the Western European passenger car market expanded by 9 percent in 2015, totaling 13.2 million new vehicles. Last month it showed year-on-year growth of 6 percent, even though January had one working day less than it had last year. We also expect a rise for 2016 as a whole. Consumption is helped by the low interest rates, rising real incomes, employment and keen fuel prices,” stressed Matthias Wissmann, President of the German Association of the Automotive Industry (VDA), as the show opened in Geneva.
“The US figures remain strong and the record from 2015 will probably be broken this year, with the total rising to 17.5 million light vehicles, although this is rather a conservative forecast,” Wissmann said.
The VDA president presented surprisingly good figures for China. “The Chinese passenger car market switched its turbo on again in October. Since then the halved rate of VAT (5 percent) has applied to purchases of new cars with engines of up to 1.6 liters. The result is that in the fourth quarter passenger car sales soared by 20 percent compared with 2014. And the positive effect is continuing this year. In January alone 2.2 million new cars were sold, i.e. 11 percent more than in the same month in 2015. We have therefore increased our forecast for China for the year 2016 as a whole and now expect a rise of 6 percent to 21.3 million passenger cars. This will also have a positive impact on the global passenger car market, which will expand by 2 percent in 2016 and thus reach the 80 million mark for the first time.”
Wissmann also sees the domestic market doing well: “In 2015 new registrations of passenger cars in Germany exceeded the figure of 3.2 million cars (+6 percent) for the first time in six years, and in January there was a rise of 3 percent. We will present the February statistics on Wednesday. In view of the favorable general conditions, we expect 2016 as a whole to bring modest growth on the domestic market.”
In 2015 the German automotive industry pushed up its turnover by 10 percent to 404.4 billion euros. Wissmann emphasized, “The figure set a new record and broke through the 400 billion mark for the first time.” Export earnings climbed by 11 percent to 263.3 billion euros, while domestic sales rose to 141.1 billion euros (+8 percent). At present the German automotive industry has a regular workforce of 799,200 employees in Germany (as of December 2015), and that is 18,100 more than one year before.
In Geneva Wissmann expressed his full support for efficient and clean diesels. “The manipulation of software was found in a company that is working hard to clarify what happened and to regain the trust of its customers. However, we reject the constant attempts to cast suspicion on the entire sector and all diesel vehicles.”
Improving the air quality, Wissmann said, was a task to which also the German automotive industry was committed: “We finished the work on particulate matter years ago: since 2009, in Germany all newly registered diesel cars from German makers have been equipped with a diesel particulate filter. In fact we achieved this goal of the ‘Stuttgart Declaration,’ issued by our industry in 2004, ahead of time. This means that for some years now, particulates have not been an issue for new diesel passenger cars. Particulate emissions from diesels have been brought down by around 99 percent since 1990.”
Modern Euro 6 diesels and the requirements of the coming Real Driving Emissions (RDE) tests have also closed the chapter on “nitrogen oxide pollutants” (NOx): “A Euro 6 diesel reduces the output of NOx by approximately two thirds as compared with its predecessors both in the NEDC and on the roads. Its nitrogen oxide emissions are 98 percent lower than those at the beginning of the 1990s,” Wissmann underscored. The nitrogen oxide emissions from road traffic had been reduced by more than 70 percent since 1990, he said, despite the volume of traffic increasing by about fifty percent from then up to the present day.
Various tools were necessary to improve air quality, Wissmann stated. “Renewing the fleet with modern Euro 6 diesel cars, improving the traffic flow (‘green wave’), and replacing old buses and taxis with new vehicles with the best emissions values. There is no question that action on climate will mean we continue to need diesels during the coming years – on average their consumption is 20 percent lower than that of gasoline vehicles, and their CO2 emissions are 10 percent lower,” said Wissmann, adding, “Those who are serious about action on climate and want to bring down CO2 emissions will find that diesels are essential – as shown by COP21 in Paris.”
Furthermore, Wissmann said, diesels were indispensable to Germany as a business location. Almost half of all passenger cars produced in Germany (48 percent) are diesels (2.7 million in 2015). Three out of four diesel cars (2.0 million) built there are destined for other countries. Wissmann stressed: “A large proportion of the total of around 800,000 jobs in the automotive industry in Germany depend on diesels – and especially at the suppliers. In general diesels are not the problem, but part of the solution for action on climate – because they have lower CO2 emissions.”
“But I also wish to say that diesels are only one area of automotive progress,” the VDA president underscored. “Today Germany is the leading provider of electric mobility. About 30 electric production models are already on the roads, and soon more will join them. Over recent years our companies have invested 14 billion euros in electric mobility.”
However, he added, Germany was still a long way from its aim of being the “leading market.” At the end of 2015 roughly 50,000 electric cars (battery-powered vehicles and plug-in hybrids) were on Germany’s roads. Electric vehicles currently make up only 0.7 percent of all new passenger car registrations in Germany.
Wissmann emphasized: “In other countries there is much more progress because a whole raft of flanking measures is boosting the market. The German OEMs’ e-models are also in demand in these countries. For example, in Norway and the Netherlands half the newly registered electric cars bear a German badge, while in the US we account for one fifth of electric cars.”
A range of measures would be necessary, Wissmann explained, for a successful ramp-up of electric mobility also in Germany: putting the charging infrastructure in place, incentives for commercial and private purchases of e-cars, a public procurement initiative, and additional investment in research and development (battery technology). “The German Government will shortly unveil its plans and we are eager to find out what they entail. We all know that one point must be ensuring a level playing field for international competition,” he said.
Concerning the second megatrend – connected and automated driving – the VDA president said, “The IAA Cars in September showed, and here in Geneva it is once again very clear, that alongside alternative drivetrains, connected and automated driving is the second major force for innovation in this industry. We aim to remain in the driver’s seat, also with regard to this ‘mobility of tomorrow.’ In the next three to four years alone, German manufacturers and suppliers will invest 16 to 18 billion euros in research and development for connected and automated driving. Digitization will bring enormous benefits: driving will become even safer, more comfortable and more efficient.”