West Europe, which has largely been in an extended lockdown from late December and through January since the identification of a more infectious COVID-19 variant, saw new light vehicle sales plummet in January by an estimated 22.6% year on year. The new variant has precipitated a third wave of infections, exacting a heavy toll on life and the economy, just as vaccination programs ramp up.
Unsurprisingly markets that seem to have navigated clear of a third round of infections generally fared much better. For example, in France, with fewer active infections and less stringent restrictions in place, sales fell by just over 3%. Similarly, in Italy a third wave seems to have been avoided but with fairly stringent restrictions in place sales declined by 13.9%. With vehicle showrooms largely closed national sales companies were reliant on booked business and digital (‘click and collect’) sales. Neither proved robust enough to underpin the month’s sales when compared with January of last year.
Worst hit of the major markets was Spain where light vehicle sales declined 48.6% year-on-year to just over 55,500 units. Next most badly affected was the UK market where light vehicle sales plummeted 34.1%. Here in the UK, once again, the car market was hit harder – sales falling 39.5% compared to an LCV segment that saw a 2% uptick. After the UK it was the German market that underwent the third worst performance. German sales fell 29.6% and again the LCV sector performed comparatively well against the passenger vehicle segment.
Here in the UK, once again, the car market was hit harder – sales falling 39.5% compared to an LCV segment that saw a 2% uptick.
Moving forward, West Europe’s fortunes will continue to be tied to the pandemic’s progress, lockdown status and the success and speed of vaccine roll outs. Thereafter the market could develop in one of two ways. Economic reality will kick in as government support is gradually tapered. Or there’s a resurgence in consumer confidence in a euphoric response to a return to a semblance of normality – the so-called ‘Roaring Twenties Mk II’.
Presently, our baseline scenario forecast a total West European market of 15m in 2021, 20.3% ahead of 2020 but over 1.3m units short of 2019’s market level.
This article first appeared in GlobalData’s Automotive Intelligence Center.