IAIN ROBERTSON 

JATO hybrid EV and plug in

JATO hybrid EV and plug in

Regardless of influences, whether ‘Brexit’ related, or arising from either financial, or retail confusion, suggests Iain Robertson, in some respects, the last thing needed to blight the motor industry was a total lockdown, although some areas have fared worse than others.

It needs to be said that I am highly grateful for the existence of number-crunchers like JATO Dynamics and its global analyst, Felipe Munoz. By all accounts, this incorruptible market-watcher that cannot be swayed by advertising revenue is the ‘go-to’ supplier for judiciously monitored and non-massaged figures.

JATO Pan Euro reductions

JATO Pan Euro reductions

Face it, all car companies love to make sweeping statements about their brands. They aid market positioning, draw consumer attention and even build confidence levels. When I am accused of ‘cynicism’, it should come as no surprise, as an endless tirade of ‘marketing-speak’ from a succession of corporate executives can result in a hefty dose of mind numbness. It is the duty of motoring journalists to eke out the best stories but, when they are cloaked in smoke and mirrors, or a ‘fear’ arises about a potential loss of advertising revenue, should a product be criticised, let alone incurring a loss of peer status, it is astonishing that any truths (unless industry promoted) reach the market at all! Personally, I endeavour never to veer from my frank and unbiased stance.

Prior to the ‘house arrest’ situation in which most of us have found ourselves for the past few weeks, the UK’s new vehicle registrations, while not in freefall, had slipped by around 17% year-on-year, which was regarded in some quarters as exceedingly grim. Personally, I believe that the figure was much worse, primarily because some carmakers had been massaging the figures with ‘self-registrations’ geared mainly towards a semblance of maintaining market share. For how long any of them could survive with such major overstock situations would be anybody’s guess.

JATO Registrations by type

JATO Registrations by type

Yet, we have heard most of the sob stories from the UK car manufacturing scene, without appreciating how dire it has been in other markets. The Coronavirus has been an unfortunate leveller in almost all nations of the world. However, for several Scandinavian and Baltic countries, where isolation of their populations was advised but not mandatory, the loss of business in March 2020 was minimal but was being affected clearly by the supply chains not working as efficiently as normal.

Inevitably, the markets hit most severely were Italy, France, Spain, Austria, Ireland, Slovenia, Greece and Portugal, where the combined volume slumped from 634,600 units in March 2019 to just 161,800 units in March 2020. As a result, looking at a breakdown of model types, those most affected were city cars, MPVs and sub-compacts. Due to the fiscal situation in both Italy and France, both of which markets collapsed, despite having been responsible for 38% of all European A and B class registrations a year earlier, the situation is very painful. Intriguingly, the all-electric Tesla Model 3 became Europe’s second-best seller in March (15,502 units, almost 1,000 more than the Ford Focus but not quite surpassing the VW Golf at 23,757 units).

JATO Top carmakers

JATO Top carmakers

Of course, the previously unassailable growth of the SUV/crossover sector has taken a major hit; down by 48% (338,300 units), although its stilted market share actually grew by nearly 40%. For all of the crowing about BEVS, EVS and plug-ins, notwithstanding the remarkable results posted by Tesla, hybrids showed a market drop of 11%, with Battery Electric Vehicles showing only 10,000 units less. Availability of relative newcomers like VW’s e-Up and e-Golf and BMW’s Mini electric, Peugeot 208e and MG ZSe accounted for 17% of all BEV platings.

The downturn in the Chinese market (79% down in February 2020), which had already dented diesel confidence and reflected its shaky economic position, has been on several carmakers’ lips for much of the past couple of years. Of course, the integrity of Chinese figures is sure to be in question but, according to its State department, manufacturing has improved to around 75% of its 2019 yearly average figures. It is also stated that, between February and March 2020, the insurance volume of passenger vehicles reached 1.08m units, a growth of 427%. However, most dealers also report of their extraordinarily high inventories.

JATO Top Ten

JATO Top Ten

In the USA, sales are reported as 1m units for March 2020, a drop of 38% from March 2019. While this number is smaller than both Europe and China, it needs to be remembered that the onset of Covid-19 and quarantine only started to affect certain states around late-March. America’s new car sales were already declining in the lead up to the pandemic’s arrival and, while a slow stagnation had been forecast, the fall will be reported as significantly steeper for April. Registrations in South America reduced by 30% to 318,000 units. Interestingly, the world’s fifth largest car market is India and it has been hit hardest of all due to its fiscal changes that have been introduced since the start of the year. One of its largest players is Maruti-Suzuki, which had dropped diesel and thus lost 20% of its business. However, a loss of market confidence about the new pollution legislation was halting consumer activity that was stymied altogether by the viral lockdown.

Of course, when populations return to whatever normality awaits them, the UK garage sector is going to be choc-a-bloc with emergency bookings, not least on the delayed MOT front. Most manufacturers have already returned to work, albeit with assurances related to hygiene and safe social distancing, although how they will work in such people-centric environments is not reported as yet. Despite various charitable projects gaining remarkable results during the UK lockdown and a working population supported by various government funding options, layoffs, redundancies and unemployment levels are set to rise substantially, which will exacerbate a position of reduced spending power. Do not anticipate a massive upwards hike in new car registrations, once restrictions are lifted.

Conclusion:       The European new car scene decreased by 39% in March 2020, compared with March 2019, the lowest March sales recorded in 38 years. Passenger car sales for the Top 27 European carmakers are down by 52%. The EV sector has been stilted by Tesla’s exceptional performance.