Lighthouse - European New Car Registrations - 2014 - Januar

Lighthouse Investment Management

European New Car Registrations - January 2014 Page 1

Euro Car Reg Tracker

European New Car Registrations

January 2014



Contents

European Car Market: Overview .................................................................................................................. 3

2013 New Vehicle Registrations by Country: ................................................................................................ 6

Passenger Cars: Top 5 ................................................................................................................................... 8

Passenger Cars: Top 5 (indexed) ................................................................................................................... 9

Passenger Cars: Top 6-10 ............................................................................................................................ 10

Passenger Cars: The PIIGHs ......................................................................................................................... 11

Passenger Cars: Best Markets ..................................................................................................................... 12

Commercial Vehicles: Major Countries....................................................................................................... 14

Commercial Vehicles: Top 5 Countries (indexed) ....................................................................................... 15

Commercial vehicles: Top 6-10 Markets ..................................................................................................... 16

Commercial Vehicles: The PIIGHs ............................................................................................................... 17

Commercial Vehicles: Eastern Europe ........................................................................................................ 18

Total EU Market (indexed) .......................................................................................................................... 19

Total EU Market (% yoy) ............................................................................................................................. 20



European Car Market: Overview

The European automobile industry1

Largest vehicle production in the world (17.7 million passenger cars, vans, trucks, busses, 22%

world market share)2

60m passenger cars (26% world market share)

Revenue: EUR 625bn3

Exports: EUR 104bn

Employment: 2 million direct jobs + 10 million in related manufacturing and other sectors (5% of

EU employed population)

For Germany, the automotive sector is an important driver of employment4

Within the EU, Germany produces around 37% of all passenger cars and 41% of all trucks.

Excluding new additions to the EU (Czech Republic, Hungary, Poland, Romania, Slovakia,

Slovenia), the production of passenger cars in the EU in 2011 was below the level seen in 1990.

1 Europe = EU27

2 Source: ACEA (Automobile

3 2011

4 Eurostat 2010



Within a decade, the BRICs (Brazil, Russia, India, China) grabbed 13%-points in world market

share from the EU and another 8%-points from NAFTA

7 EU countries make up almost 80% of the installed base, with Germany, Italy, France and UK

commanding more than 50%.



Imports of passenger cars into the EU from Japan fell by almost 50% from 2006 to 2011

Imports from the US fell by more than 50% from 2008 to 2009

Exports of passenger cars from the EU show elevated volatility, possibly amplified by currency

movements

A shortfall in exports to the US of EUR 7bn since 2006 was more than compensated by an

increase in exports to China (+15bn), Russia (+2.7bn), Switzerland (+2.6bn) and Turkey (+2.3bn).

In 2006, exports to the US were more than 10 times larger than those to China; in 2011, both

were almost equal.

CONCLUSION: Global car markets have undergone dramatic changes over the last 5-10 years. A

healthy domestic market and somewhat flexible workforce are indispensible for profitable

utilization of capacities over the cycle.



2013 New Vehicle Registrations by Country:



Part I: Passenger Vehicles



Passenger Cars: Top 5

Spain and UK growing; rest flat

Momentum stalled a bit

Scrapping premiums, like in Spain, simply pull future demand forward; the effect usually does

not last

The cost of those programs to taxpayers give an indication on how important they were to local

governments (Germany spent more than twice the amount of the US). According to anecdotal

evidence a large German car manufacturer came very close to a liquidity crisis in 2009.



Passenger Cars: Top 5 (indexed)

UK first market to turn upwards

Rest: bottoming out very slowly



Passenger Cars: Top 6-10

Sweden gained a bit of momentum

The rest: loss of momentum



Passenger Cars: The PIIGHs

Greece: The patient's heart beat almost stopped

Ireland and Iceland were the first to bottom out

Portugal the last country (apart from Greece) to recover



Passenger Cars: Best Markets

Few markets have managed to exceed registrations compared to 2007

Eastern Europe (2) and Scandinavia (2) are well represented in this list



Part II: Commercial Vehicles



Commercial Vehicles: Major Countries

New commercial vehicle registrations are back to growth in all major markets except Italy

Loss of momentum in all markets except Italy and Spain



Commercial Vehicles: Top 5 Countries (indexed)

Spain is growing, but from very depressed levels

Germany and France are slowly bottoming out

Italy stopped the decline



Commercial vehicles: Top 6-10 Markets

Netherlands are, as with passenger cars, in a depressed state

Poland showing encouraging signs

Austria has bottomed out

Sweden and Belgium stabilizing



Commercial Vehicles: The PIIGHs

Hungary: remarkable turnaround continues

Ireland and Iceland found rock bottom early, but no growth since then

Portugal : stabilization at a depressed level

Greece: trending sideways



Commercial Vehicles: Eastern Europe

Slovenia much better than the rest, but might be in jeopardy if country has to apply for bailout



Total EU Market (indexed)

Both passenger and commercial vehicle markets show growing signs of improvement

However, January saw a slow-down in momentum, especially in commercial vehicles



Total EU Market (% yoy)

Total EU new passenger car registrations are still slightly below previous year level

Commercial new car registrations are growing for the first time in 18 months.

CONCLUSION:

One month is too short to tell if the encouraging trend in European passenger and commercial

new vehicle registrations is in jeopardy. Slight growth in 2014 should still be possible.

Improvements are limited to the big three markets (UK, Germany, France) while the European

periphery and Eastern Europe are, at best, stabilizing at depressed levels.

A continued strengthening of the Euro could dent car exports into non-Euro markets.

Turmoil in emerging markets could spill over into non-Euro zone countries (Hungary) and hurt

car sales.



Any questions or feedback welcome.

[email protected]

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Lighthouse - European New Car Registrations - 2014 - Januar