European car sales see steepest drop on record

EUROPEAN car sales bottomed out last month as the automotive industry faces its worst crisis in decades.

Strict lockdown measures to contain the coronavirus closed most dealerships across the continent for the full month of April amid a precipitous drop in consumer spending, causing sales to collapse by an unprecedented 76%, the ACEA car manufacturers’ association said yesterday.

Carmakers across the continent sold just 270,682 vehicles last month, compared with 1.14 million a year earlier, the ‘’strongest monthly drop in car demand since records began,’’ ACEA said.

Southern Europe was the hardest hit, with new car registrations down by 97.6% in Italy and 96.5% in Spain – as both countries struggled with some of the highest levels of coronavirus infection in Europe. France saw an 89% contraction while Germany suffered a more mild 61% drop.

Denmark and Sweden fared best, but their markets were nonetheless off by more than a third, data showed. Sales for the first four months of the year were down 39%.

Like March’s 55% drop, the decline was far worse even than during the 2008-09 global financial crisis, which triggered a six-year slump in car purchases. The steepest losses during that financial crisis occurred in January 2009, when sales fell 27%. The crisis has struck both massmarket and luxury carmakers indiscriminately.

The Volkswagen group maintained the largest market share, expanding by 30% despite a 73% drop in sales. French rivals PSA Group and Renault saw declines hovering around 80% while Fiat Chrysler – which is seeking a 6.3 billion-euro ($6.91 billion) Italian governmentbacked loan to relaunch – dropped by 88%. German luxury carmakers BMW and Daimler saw sales sink by 65% and 79% respectively.

Outside the EU, British car sales plunged by 97.3%. “We are in a deep crisis, comparable to the one in 2008-2009, maybe worse,” said Xavier Mosquet, an auto specialist at the Boston Consulting Group. “In Europe, we might see a market drop of 22% this year” compared with 2019, he told Agence France-Presse (AFP) .

“European consumers will probably need some time before they become car buyers again,” Mosquet forecast, adding that a continent-wide support scheme would probably be needed.