European Car Sales, January 2010: The Good, The Bad, And the Ugly

Bertel Schmitt
by Bertel Schmitt
european car sales january 2010 the good the bad and the ugly

Europe’s ACEA, the Association des Constructeurs Européens d’Automobiles, better known as the European Automobile Manufacturers Association, has finally gotten around to tallying new car sales in Europe for the month of January. Europe as defined by the ACEA consists of the EU states, plus the three EFTA holdouts, Iceland, Norway and Switzerland.

First, the good news: January new passenger car registrations in Europe increased by 12.9 percent. With the exception of Germany (-4.3 percent,) the larger markets are all sputtering along nicely: France (+14.3 percent), Spain (+18.1 percent), the UK (+29.8 percent) and Italy (+30.2 percent). In total, 1,058,868 new cars were registered in Europe.

On the market share front, the Volkswagen Group maintains to be the king of the European hill with a 20.6 percent share. Next up are PSA (14 percent) and Renault (10.7 percent). The French are getting frisky: Renault added an impressive 3.1 percent to its January market share, PSA 0.6 percent. Now for the bad news:

As we are comparing with carmageddon numbers, anything better than absolutely awful will look like growth. The graph on the side is testament to that. In January 2009, European car sales had come to a practical standstill. Compared to January 2009, European car sales may be up by 12.9 percent. Compared to January 2008, registrations are down by 17.3 percent.

Next observation: The absolutely horrendous January 2009 numbers prompted most Western European governments to inject massive amounts of amphetamines in the market, in the form of cash for clunker money. These programs had varying vigor and effect, some came sooner, some later. Some have been withdrawn. Some are being phased out. Anyway, the syringes of the states prodded Europe back into plus territory in mid summer. Sales culminated in a growth of 26.9 percent in November last year. (Careful, November 2009 already compared with a post-Lehmann November 2008.)

The fleet renewal programs being withdrawn out all over Europe, the Old Country is falling back into the new normal. You will most likely see another percentage growth in February, which compares to a February 2009 that was as scary as January 2009. Beginning in late spring, you will see headlines announcing that the sky is falling in Europe. By that time, we will compare with numbers that would never had survived doping probes if this would be popular sport. The summer 2009 numbers in most of Europe were high as the proverbial kites, driven up by “Abwrackprämien,” “cash for bangers,” “Verschrottungsprämien” or whatever the drug was called in the respective country. You will see headlines announcing double digit declines. Ignore them, like you should ignore the pleadings of a junkie that goes through detox.

No matter what you will read, the sky will not come down – at least not all the way. The market will simply settle into its new normal, especially when the pull forward effects of the scrapping schemes have been digested.

One indication of what the new normal may be: In a separate report, ACEA says that between January and September 2009, automotive production in Europe has decreased by 26 percent compared to pre-crisis levels in 2008 and 2007. That capacity is sitting idle and something (we are looking at you, Opel) must go. And if all else fails, look for Abwrackprämie II.

One more thing: In Europe, the median age of a new car buyer is somewhere between 40 and 60, depending on car and country. There is a bulge of that age group that drove European car sales at the beginning of the new millennium, and that fuelled the drive to more upscale models as buyers get older and more affluent. This bulge is slowly heading towards retirement. Blame it on the pill, but birth rates often halved in European countries when 1970 came around. The babies that weren’t made back when are now sorely missed in the showrooms. Most likely, if we look back in a few years, we’ll see that Europe’s new car sales have peaked in 2007.

Note: The reports can be downloaded as PDF, or as an Excel file. The Excel file contains manufacturer data. Also, beginning in 2010, the ACEA is no longer reporting the Western and Eastern EU countries separately, but lists them as one happy (more or less) family. Which reminds me of the years after Germany’s reunification. The formerly East German states were referred to as the “new states.” People in the East retaliated and called the former West Germany the “used states.”

Join the conversation
  • HerrKaLeun HerrKaLeun on Feb 16, 2010

    BS: I wouldn't translate "alte Bundesländer" with "used states". More correctly "old states". I don't recall anyone referrring to "Wessies" as someone from the "gebrauchten oder abgenutzten Bundesländer" Let's bury that old hatchet then :-) enough nationalism here in WI, where people are proud of their cheese (that mostly is made of Californian milk powder)

  • 50merc 50merc on Feb 16, 2010

    A woman criticized Winston Churchill for ending a sentence with a preposition. He replied, "This is the sort of nonsense up with which I will not put!"

  • FreedMike Race car drivers are all alpha-types. Aggression is part of the deal. I think you see more of that stuff in NASCAR because crashes - the end result of said aggression - are far more survivable than they would be in F1 or IndyCar.
  • Analoggrotto Only allow Tesla drivers to race, we are the epitome of class and brilliance.
  • Wjtinfwb When my kids turned 16 and got their Operators, we spent $400 to send both (twins) to 2 driving schools. One held by the local Sherriff was pretty basic but a good starter on car control and dealing with police officers as they ran the school. Then they went to a full day class in N Atlanta on a racetrack, with the cars supplied by BMW. They learned evasive maneuvers, high speed braking, skid control on a wet skid pad and generally built a lot of confidence behind the wheel. Feeling better about their skills, we looked for cars. My son was adamant he wanted a manual, Halleluiah! Looking at used Civics and Golf's and concerned about reliability and safety, I got discouraged. Then noticed an AutoTrader adv. for a new leftover '16 Ford Focus ST six-speed. 25k MSRP advertised for $17,500. $2500 above my self-imposed limit. I went to look, a brand new car, 16 miles on it, black with just the sunroof. 3 year warranty and ABS, Airbags. One drive and the torquey turbo 2.0 convinced me and I bought it on the spot. 7 years and 66k miles later it still serves my son well with zero issues. My daughter was set on a Subaru, I easily found a year old Crosstrek with all the safety gear and only 3k miles. 21k but gave my wife and I lots of peace of mind. She still wheels the Subaru, loves it and it too has provided 7 years and 58k miles of low cost motoring. Buy what fits your budget but keep in mind total cost over the long haul and the peace of mind a reliable and safe car provides. Your kids are worth it.
  • Irvingklaws Here's something cheaper, non-german, and more intriguing...
  • Wjtinfwb Happy you're loving your Z4. Variety is the spice of life and an off-beat car like the Z4 intrigues me as well. More than anything, your article and pictures have me lusting for the dashboards of a decade ago. Big, round analog gauges. Knobs and buttons to dial up the A/C, Heat or Volume. Not a television screen in sight. Need to back up? Use the mirrors or look over your shoulder. If your Z4 had the six-speed manual, it would be about perfect. Today's electronified BMW's leave me ice cold, as do the new Mercedes and Audi's with their video game interiors. Even a lowly GTI cannot escape the glowing LED dashboard. I'm not a total luddite, Bluetooth streaming for the radio would be nice and I'd agree the cooled seats would be a bonus on a warm day with the top down. But the Atari dashboard is just a bridge too far for me.