Ghosn Sees No European Turn-Around Anytime Soon, Or Later

Bertel Schmitt
by Bertel Schmitt

Nissan and Renault co-CEO Carlos Ghosn still sees a future in the electric car, it’s the European market that doesn’t have great prospects of a turn-around as far as Ghosn is concerned.

Ghosn does “not expect any strong recovery in the troubled European auto sector in the medium term,” Reuters reports from France. “I am preparing Renault to several years of market stability, at best,” Ghosn said. That’s stability at low levels not seen for 20 years, mind you.

While some cling to hopes for a quick turn-around (hello, Opel), Ghosn repeatedly warned of a “structural decline” of the European car market. Simple population studies show that there will be fewer and fewer new car buyers in Europe for many decades, with no relief in sight.

Ghosn’s faith in electric car sales however remains unbroken. Between the two of them, Renault and Nissan will have sold a total of 100,000 electric vehicles so far by the end of June, Ghosn told Reuters. Ghosn said the alliance’s investment in hybrid and electric vehicles “is not a bet, it is a certainty.” Other than Europe, EV sales can only go up.

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Klossfam Klossfam on Jul 07, 2013

    Ghosn can be a bit of a cement head but he is probably right about the Euro market. It's a mess...What it DOES mean for us North Americans is that the European auto makers will be FORCED to sell the cool stuff we WANT over here...i.e. diesels and other performance variants...I know the state of the Euro economy green lighted the VW GTD for 2016. Now we just need the Tiguan TDI, a few more BMW diesels aka X3, etc. Their loss will be our gain.

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    • Lorenzo Lorenzo on Jul 08, 2013

      @Inside Looking Out If we improve the environment, it's for human benefit, not "Mother Earth".

  • L'avventura L'avventura on Jul 07, 2013

    Unfortunately, there really isn't any other market to flee to in the medium term. China, a safe haven for many European brands like Renault/Nissan and BMW/Daimler/VW, is teetering on the brink with a massive housing bubble, shadow banking system, trillions of dollars local government debt, and questionable financial instruments that make the 2008 US housing crash look mild. With Europe down and out for the medium term, any other economic shock will be like a meteor to the Yucatan Peninsula for the European automotive industry.

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    • L'avventura L'avventura on Jul 07, 2013

      @Lorenzo If you follow TTAC contributer Matt Gasnier's blog on global car sales, you'll see that outside of Tunisia, the African market is dominated by the Americans, Japanese, and Koreans (with the Chinese quickly making headway): http://bestsellingcarsblog.com/category/africa/ Yes, Africa is home to a billion people, but most of those people really aren't car consumers. The market is nowhere near maturity where it can save the European brands. Last year, Toyota had the African sales crown selling 237,000 cars, GM took second selling 180,000 cars in Africa (largely with Isuzu pickups): http://www.reuters.com/article/2013/04/11/us-africa-summit-cars-idUSBRE93A07Z20130411 Let's put it this way, In Tunisia, Renault sold 6k cars in the entire year of 2012, Peugeot sold 5K cars. The volume is minuscule. http://bestsellingcarsblog.com/2013/03/07/tunisia-full-year-2012-renault-volkswagen-and-peugeot-dominate/ Renault will do fine, primarily because of Nissan, if anything happens, I'm sure Nissan will inject cash into Renault. Furthermore, the combined power of Nissan-Renault (with Dacia, Autovaz, etc under their wing) has near global coverage in all markets.

  • Onus Onus on Jul 07, 2013

    Now this guy has it. Declining birth rates which have well below replacement for many years in every western, and many eastern European countries is obviously going to make a market smaller than it once was.

  • Gasser Gasser on Jul 07, 2013

    Having exported so many good paying jobs to lower cost countries, leaves the US without the strong middle, lower middle class to purchase new autos. Europe is a few steps ahead of the US in terms of $8 and $9 per gallon gas. When gas prices spike again in the US, we will see our car sales fall off a cliff. It's not just the Great Recession, it's a tectonic shift in JOBS which is reordering the auto industry and the entire economy. The economic ladder has lost a few rungs. Only the top end is left relatively untouched. Hence the growth in the luxury and near luxury segment and the stampede by BMW and Mercedes for US sales. The "new" starter car is a used one. Shrinking wages decrease disposable income for vehicle purchase. Think of what else is gobbling up your take home, compared to 10 years ago.

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    • Summicron Summicron on Jul 08, 2013

      @Pete Zaitcev "It’s the government policy that devastated natality in the first place.." Only for the best; for the rest it rewarded spawnage and still does.

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