By on September 7, 2013

Carfree Paris. Picture courtesy of menly.frCar-free Paris, France.

Last time I annoyed you with my stats, we went through a worldwide whirlwind for the July 2013 Roundup. Today we focus on Europe, where apart from one main island of growth (literally and figuratively: yes I am speaking about you the UK), the new car market recession seems to know no end.

Not interested in the old, grumpy continent? That’s totally fine, I have prepared something else for you: you can check out sales stats for 176 additional countries and territories on my blog. Go on, I think you’ll like…

Back to Europe.

While the US new car market is in total euphoric mode, up 17% year-on-year in August to return to annual rates not seen since 2007, Spain has experienced its weakest month of August on record, and in France we are looking at the lowest monthly sales figure in 37 years… This is an even worse situation than in Greece, whose bankruptcy has been much publicised, but with a car market known for its volatility at its lowest in ‘only’ 26 years.

In this context, some insiders, including Renault-Nissan CEO Carlos Ghosn and Ford Europe CEO Stephen Odell, don’t see a return to growth until 2016 at the very earliest. So the European recession is here to stay.

Well I will push this theory further and ask: will the Western European new car market ever grow again? Or has it reached saturation at around 12 million annual units?

Car scrappage in Italy. Picture courtesy of FlickrMore cars were scrapped than bought in Italy in 2012 for the first time since World War II…

There are a few signs on the continent that the car may not be the preferred mode of transport in the future, simply because other options, mainly public transport, offer a much cheaper and sometimes more convenient outlook. The first striking event that could announce this trend happened in 2012 in Italy: for the first time since the 2nd World War, there were fewer cars in circulation in the country than the year before. More cars were scrapped than bought. With a new car market down a further 9% in 2013, chances are this will happen again this year…

Eurostar. Picture courtesy of SNCFEuropean cities are well connected, sometimes making the train a faster option than the plane.

A demographic trend is also at play in Europe, with most countries seeing their population ageing and stagnating, meaning less working people and less people in ‘real’ need of a car to commute every day. Now let’s not get ahead of ourselves, all is not doom and gloom for the European new car market and no time for car manufacturers to abandon the continent just yet!

Proof: UK sales display insolent health this year, up 10% year-on-year and, most importantly, boosted by private demand, not leases or rentals. Denmark is posting record year after record year in spite of very high taxes on the price of cars. Also, saturated markets like Canada and Australia are reaching record levels in 2013. But their geography makes public transport a challenge and keep the car essential.

Velib' Paris. Picture courtesy of dailyphotostreamVelib’ system in Paris, France. 58% of Parisian households do not own a car.

And this is the core of the European trend. The cities of Europe are extremely well-connected, both with each other and inside out, with many transport options to choose from for each trip. For example, 58% of households living in Paris do not own a car vs. 19% nationally! A very dense metro system coupled with the recent addition of electric car- and bike-share programs (autolib’ and velib’) have made this car-free situation possible.

Tramway Angers France. Picture courtesy of angersloiretourisme2.comCould the newly revitalised tramway kill the car in France?

Now let’s zoom onto France, where the tramway is making a spectacular resurgence with no less than 17 cities building a new network from scratch in the last decade.

In France, since 2000 no less than 16 cities have built a tramway network for the most part from scratch! These cities are Montpellier (2000), Orleans (2001), Nancy, Caen (2002), Bordeaux (2004), Clermont-Ferrand, Mulhouse, Valenciennes (2006), Le Mans, Nice, Toulouse (2007), Reims, Angers (2011), Brest, Dijon and Le Havre (2012) and Tours (2013). 5 more are due to receive a tramway line before 2020: Besancon, Avignon, Amiens, Lens and Toulon…

Tramway Tours France. Picture courtesy of agglo-tours.fr 2The futuristic tramway in Tours, France, inaugurated on 08/31/13

A spectacular resurgence which has almost always prompted a sharp increase in the general use of public transport in these cities: in Toulouse for example, public transport use, including but not limited to trams, has increased by 35% since 2007.

More frequent public transport use means less frequent car use, right? Not so simple.

Tallinn Free Public Transport. Picture courtesy of directmatin.frTallinn is the first EU capital to offer free public transport to its residents

Many studies have tried to demonstrate that the appearance of a tramway network reduces the utilisation of the car in the city concerned, but the correlation is proving relatively hard to isolate. What seems to happen is the car is less used inside these cities, or at least on the routes served by the tramway network, but still used to get to the tram or public transport hub. ‘Relay’ parking lots have had to be created at the periphery of these cities to allow commuters to park their car before they jump on public transport on their daily commute. Toulouse, the 2nd city in France for relay-parking capacity, is already saturated and has launched the creation of 4,000 additional spots.

In Tallinn, Estonia, public transport is now free for the city’s residents to encourage people to leave their car at home, or even better (worse for car manufacturers), not buy one in the first place. An interesting experiment that however shows the lengths needed to make commuters give up their car.

What about inter-city commutes and inter-regional trips? In spite of a very dense train and plane network, the car is still king by very far. Out of 100 trips of more than 100 km in France, 75 use the car, 17 the train, 6 the plane and 2 the bus.

Yes, car manufacturers can breathe a sight of relief: Europeans love cars, and are not ready to give them up (yet)!

What is your opinion? Is public transport a valid option in your city? Do you find yourself using your car less than you used to? Can you imagine a life without a car? I’m keen to hear your views so please comment on here if you want to share anything relevant to this subject.

Sources: www.insee.frladepeche.fr, La Croix, www.transbus.org

Matt Gasnier, based in Sydney, Australia, runs a blog named Best Selling Cars Blog, dedicated to counting cars all over the world.

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41 Comments on “Best Selling Cars Around The Globe: Will The European New Car Market Ever Grow Again?...”


  • avatar
    Onus

    The biggest issue still falls on demographics.

    Get between cities can still be done without a car. Sure having one makes it a bit easier. But, even with high public transportation costs diesel and gasoline still cost a arm and a leg in western Europe.

    It will be interesting to see how their social systems survive on dwindling population. I hope they can find a way as they are wonderful.

    • 0 avatar
      Hillman

      I would say having a car in a city is a pain and I live in a midsize city that had a car in mind when it was built. You got parking problems, driving is a major hassle just trying to find parking, and to top it off you car will be destroyed from careless drivers. If the public transit is good then why bother trying to fit a car in a place that never intended to have cars.

    • 0 avatar
      skor

      The biggest issue falls on economics. Sales of cars are up in Denmark. Denmark has a robust economy that exports gas and oil. Denmark also has the WORLD’S LOWEST LEVEL OF INCOME INEQUALITY.

  • avatar
    Lorenzo

    The odd situation in Italy of more cars being scrapped than new cars sold makes a little sense – they’re mostly Fiats! Overall, though, the main reason for the auto industry’s weakness is political.

    As long as you have government at all levels, suppressing individual transportation through obvious means (high fuel taxes and expensive registration requirements) and less obvious means (subsidizing mass transit, restricting urban auto use, eliminating urban roads and parking for trolleys), you’re going to see a reduction of car sales and usage.

    I think they call it social engineering. The French people, in particular, will roll over until the “authorities” turn their attention to smoking. Then the stucco will hit the fan, but it won’t do anything for car sales.

  • avatar
    sportyaccordy

    Amazing that one of the hubs of car culture is now the epicenter of the automotive recession. I mean car sales are even gaining in the 3rd world. Then again, nobody outside of France/Italy drives affordable French/Italian cars. So it may just be a bubble winding down. Kind of sad though.

  • avatar
    JD321

    The political terrorists of the EU Tax Farm have been trying to starve their tax livestock out of their automobiles for about a decade now. Personal transportation is an individualistic concept and must be banned in order to keep the slaves in their collectivist mindset (It really is the EU Borg Collective). Cars are for the politically connected rich. Let them eat cake.

    • 0 avatar
      tinoslav

      This is just ghiberish. The car as a means of transport is fine and well but a clean and efficient public transportation is hard to beat.
      My last four months I have been able to walk to work and also walk to most of all the shops (groceries and stuff). It has been a truly liberaliting experience.There is nothing “free” about being stuck in a traffic for an hour a day.

      • 0 avatar
        Onus

        I’m with you. Public transportation is much better for the environment and more enjoyable than getting stuck in traffic jams.

        If i can find a job close to home again I’m going back to walking, biking, or taking the bus myself. Or a combination of two. Our buses have bike racks on the front.

        I used to walk to work so having to drive and get stuck in traffic sucks! There is something to be said to living close to where you work.

        • 0 avatar
          Kenmore

          It all depends on which public you’re being transported with. With some, you’ll encounter new sights, sounds and fragrances on every trip and may even receive free body piercings.

          Celebrate enforced diversity!

        • 0 avatar
          TEXN3

          You have no idea how nice it is, and I would only be faced with a 15-min commute if I did drive (qtr of that was finding parking). I bike and it takes 25 mins plus 10 min shower and dress at work or in winter I take the 20 min bus ride and it cost $1 each way. But I live in a medium sized city (Boise) and bought a rancher when real estate here was cheap. We do just fine on 1 car as well.

          Sure the bus is subsidized and only runs till 630 pm (my employer has plenty of vehicles available) but they’re clean and run on a tight schedule.

          My dad used to ride the Houston Metro commuter buses but would never dare step on the downtown city bus… Vastly different “clientele”… At least it was in 30-15 years ago.

          • 0 avatar
            tinoslav

            A lot of it depends on the quality of the service. Of course, inconveniencies can happen and sometimes you get into situation that you will remeber forever (once a drunken homeless person vomited on my back, another time a guy with a long knife ran directly in to a bus and sat right in front of me). But if the bus/tram/metro standard is fine, it can be so much more pleasurable than spending time in a traffic jam. One of the key issues is also the place of living. My aim is always not to live futher than 20 minutes from work. Spending hours every day just to travel is a complete waste.

    • 0 avatar
      CJinSD

      The funny part will be when they’re too successful and the self-righteous mass transit parasites don’t have enough car owners subsidizing their ‘clean and efficient’ form of transportation through punitive fuel, usage, and registration taxes.

      • 0 avatar
        Onus

        Public transportation is subsided here in CT because only poor people use it. I think its the least of our worries to allow people to work and at least trying to live. Would you rather them collect money?

        • 0 avatar
          el scotto

          In the metro DC area Govt employees receive benefits to take mass transit. The new federal building? Only has X amount of parking available to all its employees. Take the D.C. Metro to the Pentagon, various city buses, express buses to the burbs are all loading and unloading at the bus stop; people are standing in line to “slug” (car pool with a complete stranger); there are commuter vans loading/unloading in the van lot; finally the Pentagon is serviced by two metro lines. All of these people are using alternative forms of transportation. Some horror stories? Of course. Efficient way to get work? Yes.

      • 0 avatar
        tinoslav

        Public transport is subsidizes for a lot of reasons. Mostly because it is much cheaper than building and maintaing new roads (in a lot of cities this option is not even possible). As someone who can speak about punitive taxes on fuel from first hand (more than 50% of price of fuel are taxes over here), I fully agree with the policy. The taxes just take into account the externalities (emission of various types of gases) that would normylly not be included in the fuel price.

        • 0 avatar
          JD23

          Why don’t people value public transportation enough to pay user fees sufficiently high to obviate subsidies?

          • 0 avatar
            Kenmore

            Are you asking the Europeans reading this?

            Because that question is preposterous to Americans. It’s like asking:

            “Our sewage treatment plant is one of the most advanced in America… why don’t we contribute so they can have a float in the parade?”

          • 0 avatar
            JD23

            No, I was making the point that most people, at least in the US, like public transportation as long as it is highly subsidized and appears to be superficially inexpensive to the user. When I was in college, I didn’t have a car and liked riding the “free” bus (hidden as a line item in a long list of student fees), but I would have appreciated it somewhat less if I were paying $2-3 per ride.

          • 0 avatar
            Phillin_Phresh

            The same could be said for the road system. Costs for upkeep are partially paid for by gas taxes, but they are also heavily subsidized by your tax dollars. Also consider that most people don’t account for what the same trip costs to drive. Public transit “hurts” more because you have to shell out every time you ride. What we are missing in this comparison is some kind of taxi-style device to show people the true cost of a trip.

            Just for fun (everybody loves Economics, right?), I priced out a trip from my place in NE Portland to spend a few hours downtown. I could take light rail, or I could drive my 2006 Mazda 3. This is relatively fair because the Mazda is fuel efficient and has already depreciated a lot. Factoring in total operating costs and depreciation for one year, assuming 15,000 miles driven each year, my cost per mile came to $0.557. This trip is 11.6 miles round trip, so the cost to drive is $6.46. A light rail ticket is $5. You could argue that the ticket would be more expensive without transit subsidies; I would counter that I haven’t even paid for parking yet.

          • 0 avatar
            JD23

            I’m with you in regards to paying for roads with gas taxes and tolls. As for your specific cost comparison, it’s really impossible to say which option is less expensive without knowing the level of subsidies for both options. However, if light rail truly is cheaper, then you’ve made a strong argument for why subsidies are unnecessary.

        • 0 avatar
          CJinSD

          “The taxes just take into account the externalities (emission of various types of gases) that would normylly not be included in the fuel price.”

          So you think the loot is spent cleaning up the ‘externalities’ of personal transportation? That’s hilarious. The government is just abusing its power to redistribute wealth from the people that earned it to spend it for the their own purposes to people that are compliant puppets who trade their freedom for a free ride.

  • avatar
    AMC_CJ

    “offer a much cheaper and sometimes more convenient outlook”

    Because the government skews everything heavy over there.

    Some places public transportation works, others it does not. I spent a little time in Scottland, the town was smaller, everything is close, it works for those people, but I could never live like that. I live in a rural area because I like the land, the privacy. Obviously a car is necessary. But my city has a very nice highway system, and even though my commute is 25miles through the heart of the city and out the other side, it still takes me 25-35mins, even at rush hour.

    Actually, I find the city itself easier to get around then some suburbs.

  • avatar
    Pch101

    Poor economic conditions linger in Europe because of austerity-driven policies. In time, things will recover in spite of the policies, and the car market will rebound. As the economies of the east catch up to the west, their demand for cars should outpace the norm.

    Mass transit doesn’t compete with cars, it allows those cars that are currently on the roads to work better. Shifting everyone from public transport into private cars would simply create gridlock for both the existing drivers and the new ones.

    There are plenty of Europeans who have convenient access to public transit. There are plenty of other Europeans who don’t. The latter group will continue to drive, because it isn’t possible to link every possible location with convenient mass transit. Even within major European cities, you will find workers who drive to and from work.

    And if you are traveling out of town with three or four people in Europe, then it is generally cheaper to drive than it is to take public transit. Even those traveling in pairs may find that it costs less to drive. If traveling alone, then public transit is more likely to be the cheaper option.

  • avatar

    “In Tallinn, Estonia, public transport is now free for the city’s residents”

    TANSTAAFL

    http://www.last.fm/music/NRBQ/At+Yankee+Stadium/Ain't+No+Free

  • avatar
    Big Al from Oz

    Rennes is developing and increasing a Metro system. Even in Paris they have just completed a tram system that will eventually encase the ‘old’ city.

    TGV and even the old ex-Teoz style of train in France is quicker than flying.

    Several months ago I went from Paris to a place halfway between Bordeaux and Toulouse. It took 4 hours to travel 800km on a TGV and it only cost 70 Euros. Half the trip was not on the very fast 350kph track.

    A flight would have required a 30 minute RER ride from Chatelet to CDG. Then an hour early to hand in your baggage. Then a similar story at Bordeaux. Then a train for 150km.

    Even driving the autoroute would have taken 6-7 hours.

    From the UK/Benelux/Ruhr and down into the top of Italy the population density is high and is able to economically support the very highly developed transport infrastructure.

    Even in the US maybe the Boston/Washington DC corridor would be able to support that type of transport infrastructure. Europe is able to have a connected system, whereas a US system would be fragmented due to the distances and low population between the highly urbanised regions. Someone would have to subisidise a lot of money to make it viable.

    In Australia it isn’t viable at all, flying is the best and most economical mode of transport.

  • avatar
    Joss

    Caption ‘Car Free Paris.’ La gens burnt them all.

    “In Tallinn, Estonia, public transport is now free for the city’s residents”

    Estonia is a CAR FERRY at the bottom of the Baltic sea.

    I caught an interesting insight on Velib. Paris rentals are repaired on a barge which plies the river. Damaged bikes are left in cages near the shore. The mechanics take them aboard for repair and swap. No trucks & trailers and commercial rent to pay.

    Motoring is an old medium like cinema. Peaked. Everything to come will be a less inspiring techtronic rehash of what’s come before.

  • avatar
    romismak

    Yes European auto sales will grow higher, they can´t be falling forever, or stagnating at this low numbers, simply once there will be new cars needed, similar is with US market, but there was even worse – i mean in 2009 auto sales fell to 10.4m, you can just go up from super low numbers.

    For example in last years maybe you had used cars in Europe you can buy instead of new cars, but those 2-3-4 years old used cars will be even older in next 2-3 years, so you will eventually need to buy new car. European market peaked at 18.27m light vehicles in 2007 before crisis began. last year 2012 auto sales were 12.5m passenger cars and more than 1.5m LCV – so European market was above 14m ligh vehicles, this year it will be even lower maybe around 13.3-13.5m, those countries like Italy, Spain won´t be forever at such low numbers, i think around 16m is normal level, those 2007 levels were big.

    Since 2007 auto sales are falling so 2013 will be 6th straight year of decline, you can´t be falling down forever, i think it can be similar to Japan, they had in 1990 i believe record auto sales and than everything went to hell, but you always will have good sales,because market is mature, rich and population is big, that´s why i am 100% sure European market will grow beginning next year to at least 16m – by Europe i mean EU and EFTA countries – ACEA statistics

  • avatar
    99GT4.6

    The public transit where I live is absolutely awful. They keep cutting service while at the same time hiking the fares. A one way ride is $3! And the buses are always late or just never show up. Driving to work or college takes me 15 min. Taking the bus to college is half an hour and to work is an hour. It is also cheaper to buy gas for my Mustang than pay for the bus.

    • 0 avatar
      Hillman

      Sadly, cities are cutting the subsidies to the bus services and that is the natural result. Such is life in this no more tax increase environment.

      • 0 avatar
        thelaine

        If only…

      • 0 avatar
        28-Cars-Later

        Shouldn’t the way to remedy this be to find ways for the bus or public transit services to become self sustaining or even profitable? Not being sarcastic or snarky, I’m just tired of munis pissing billions away on programs which only benefit a slice of the population. Short sighted politically motivated thinking is why the US is bankrupt in the first place.

        • 0 avatar
          Hillman

          Well it depends if on how you view transit options. If having adequate public transit allows some of the poor to get to jobs then cutting bus service will raise costs the taxpayers in other areas (SNAP, WIC, Section 8 housing etc.) Are those costs adequately reflected in the savings projections? Also, how much are general fund revenue (sales and income tax) supporting roads and is that really the best use those tax dollars? It is all based on projections and judgment so it makes these debates so much fun.

          • 0 avatar
            thelaine

            You are assuming we should be paying for all that sht in the first place.

          • 0 avatar
            28-Cars-Later

            TheLaine makes probably the best point, but I agree it would depend on how you view transit. If one views transit as a mechanism to move people of any social class in and out of a city for work or pleasure while also saving fuel and wear/tear on infrastructure, I would think it could be done profitably if you carried enough riders on enough routes. If you view it as a hybrid model of transportation for the above coupled with transfer payments from gov’t to lower social classes (for free transit) and privileged/politically connected workers then profitability becomes far more challenging. The beneficial end of the service (worker/citizen transport) cannot offset the losses generated on the other end of the spectrum, neither the welfare classes honestly afford the fare increases, in the end no one ones and the service cannot sustain itself. I think no matter how you look at it you can only carry so much dead weight without tipping over, so in that regard I say let the transit crash and burn as it is, some entity will step in and find a way to become profitably where the money is there to be made.

    • 0 avatar
      99GT4.6

      Our taxes are going up too. I don’t believe the transit subsidy has been cut where I am. I’d say the biggest factor in the fare increases in my city is the increased labor costs from the overzealous transit union. The fare increases pay for increased (inflated) union wages and not improved service. Another part of why it takes so long to go anywhere is most of our routes aren’t efficient. They snake all over the place instead of running down major streets or in one general direction.

  • avatar
    stanczyk

    ..yes, europe is getting poorer and older (and young hipsters don’t care about cars anymore – they prefer .. “virtual brainwashing”..) , but it will manage ..
    european-cars use less fuel and there’s growing “let’s ride a bike” trend (urban commuter bicycles, bike rentals and .. bike lanes in big cities .. )

    but
    I’m really worried about fat&lazy americans .. how the’ll cope after wall-street parasites and big corporations suck-off all “blood from the system” (dollar collapse) ..

    yeah , .. Tata Nano “Turbo” ‘ll be your next Ford Mustang .. :) .. be prepared ..


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