Despite hopes that the European market might have finally bottomed out, car sales for the first half of 2013 plunged to a 20-year low, according to industry data, with little sign that the downturn is about to reverse itself.As I said yesterday ....
According to new data from the European Automobile Manufacturers Association, or ACEA, new vehicle registrations continued to slip with a decline of 6.3% in June, bringing total sales for the first six months of the year to just 6.44 million, a 6.7% drop.
Among the five largest markets, only the U.K. was up, a countervailing 13%, while the other regional powerhouses, Germany and France were down 4.7% and 8.4%, respectively. The United Kingdom, in fact, has been running counter to the downward slide all year, so far gaining 10%.
Among smaller markets, sales plunged 42.7% in Cypress, the latest European country to receive a bailout aimed at helping restructure its lopsided sovereign debt load.
Even the traditionally strongest manufacturers have been struggling this year, Volkswagen AG declining 4.4%, with its high-line Audi brand down 8.8%, according to industry figures. Italy Fiat SpA was off 10% for the first half, with France’s Peugeot off 13.3%, one of the worst declines of any major brand and a further worry for a company desperate to reverse mounting, multi-billion dollar losses. Honda was the rare winner among mainstream brands, with a sale gain of 6.4%.
Only a handful of luxury brands bucked the industry downturn, Mercedes up 3.5%, Land Rover rising 10.2%, and Jaguar gaining 15.5%. But BMW was down 7.7%.
Expect the recovery to be "weaker than expected". Indeed, expect no recovery at all. Rather, expect Germany to contribute in a major way to the pending "unexpected" non-recovery, unless by some miracle European exports to Mars suddenly take off.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
