In the light of the major economic crisis facing the auto industry due to COVID-19, the European Automobile Manufacturers’ Association (ACEA) has radically revised its 2020 forecast for passenger car registrations down to about -25%.
This effectively means that the industry association expects car sales in the European Union to tumble by more than 3 million from 12.8 million units in 2019 to some 9.6 million units this year.
Following the first shockwaves of the crisis between mid-March and May, the EU market has contracted by 41.5% so far this year. This situation is expected to ease to a certain extent in the coming months as lockdown and containment measures are lifted throughout the region.
Nonetheless, in terms of volumes, ACEA’s forecast for 2020 represents the lowest number of new cars sold since 2013, when the industry had come through six consecutive years of decline in the aftermath of the 2008-2009 financial crisis. In terms of percentage change, the bleak outlook represents the sharpest drop ever witnessed by Europe’s automobile sector.
“ACEA maintains hope that this dramatic scenario can be mitigated through fast and strong measures by the EU and national governments,” stated ACEA Director General, Eric-Mark Huitema.
“Given the unprecedented collapse in sales to date, purchase incentives and scrappage schemes are urgently required right across the EU to create much-needed demand for new cars. In the interest of our industry and the wider EU economy, we are calling for the necessary political and economic support – both on the EU as well as the member state levels – in order to limit the damage to production and employment over the months to come.”
About the EU automobile industry
- 13.8 million Europeans work in the auto industry (directly and indirectly), accounting for 6.1% of all EU jobs.
- 11.4% of EU manufacturing jobs – some 3.5 million – are in the automotive sector.
- Motor vehicles account for €440.4 billion in taxes in key European markets.
- The automobile industry generates a trade surplus of €84.4 billion for the EU.
- The turnover generated by the auto industry represents over 7% of EU GDP.
- Investing €57.4 billion in R&D annually, the automotive sector is Europe’s largest private contributor to innovation, accounting for 28% of total EU spending.