18 June, 2019

European new car registrations record first increase in eight months

The European new car market saw its first growth in eight months in May, albeit by an extremely small margin.

In May, new car registrations in the European Union recorded a 0.1% increase over the same period in 2018, according to figures released by the European Automobile Manufacturers Association (ACEA). Sales of new cars in the EU have been in decline since the introduction of WLTP in September 2018, which caused a spike in registration the previous month.

The slight increase follows a 0.4% drop in April, suggesting the effect of WLTP, which saw deliveries of many new models to dealerships delayed, may finally be at an end and the market is returning to stability.

The five major western European markets delivered mixed results, with Italy posting a 1.2% decline and the UK suffering a drop of 4.6%. Spain recorded the worst performance of the big markets, with sales down 7.3%. The country is suffering economically and the effect of WLTP coming to an end has stopped influencing results in the country, giving a more representative figure of the state of the market. Sales in Spain have been declining since September last year - apart from in April, when the rental channel saw an increase ahead of the Easter period.

This leaves France, with a 1.2% rise in registrations, while Germany performed best of the big five, with a 9.1% increase. This is partially due to new model launches such as the BMW 3-Series and Volvo XC40. BMW and Volvo registrations grew 42% and 77% respectively in May.

Central European countries were able to bolster sales in May, aiding the 0.1% increase. Of these, Poland led the way with an extra 4,740 new cars registered compared to May 2018, equating to a rise of 11.2%.

Year-to-date

As May saw the first increase in eight months and a slender one at that, it is no surprise that EU new car registrations still trail in the first five months compared to the year-to-date figures in 2018. According to the figures, new car sales are down 2.1% in the first five months of 2019.

Four of the big five markets have contributed to this decline, with Spain suffering the biggest drop, down 5.1%. The Italian market is down by 3.8%, while the UK has seen a 3.1% drop over the year so far.

Sales in France have remained relatively stable. Although the country is currently still seeing a decline, the figure of 0.05% is miniscule and represents just 456 cars. Thanks to its performance in May, the German market is the only one of the major markets in the EU to post an increase in the year-to-date. New car registrations were up 1.7% in the first five months, compared to a 0.2% decline in the first four months of 2019.

Manufacturer results

Volkswagen Group recorded a 2.1% sales decrease in May, bringing its current year-to-date decline to 3.1%. The company was hit by an 8.7% drop at its core brand, while of its mainstream marques it was once again SEAT that recorded the healthiest increase, up 13.9%.

PSA Group grew sales by 4.3%, thanks to improved sales at Citroen, which saw a 13.7% uplift. The French manufacturer’s other brands performed well, with the exception of DS, which recorded a 7.1% loss. Domestic rival Renault, which saw hopes of a partnership with Fiat Chrysler Automobiles (FCA) dashed earlier this month, recorded a 3.7% drop with its core brand seeing sales fall 9.8%. The Italian company also suffered in May, with sales declining 8.1% year-on-year.

Hyundai Group sales rose 2.1% thanks to its Kia brand (up 5.1%) and the new 3-Series helped give the BMW Group an overall jump of 8.8%. The 16% growth for the core brand offset a 16.3% decline at Mini. Toyota grew sales by 11.8%, with Volvo again showing impressive figures as the new XC40 helped to generate a 16.3% rise.

Nissan was once again a big loser in the figures. The Japanese carmaker has struggled in Europe all year and posted a 17.9% decline in May. So far in 2019, the carmaker’s new car registrations are down by almost a quarter (23.6%). However, it was fellow Japanese company Honda that saw the biggest decline. Sales fell 18.6% in May and are 14.7% lower in the year-to-date.

Following a buoyant couple of months in March and April, Jaguar Land Rover also saw a decline, with a 9.9% drop overall as its Jaguar (down 9.3%) and Land Rover (down 11%) brands both suffered. Ford too saw a return to declines, down 4.4% year-on-year in the month.