As the financial crisis in Europe swirls, we bring you exclusive extracts from LMC Automotive’s suite of quarterly European national market sales reports and forecasts. The reports cover forecasts for car and light commercial vehicle sales by make and model over the next seven years. This second extract from the quarterly series looks at Spain.


• The Spanish economy slowed sharply through 2011, with the quarterly growth rate falling from 0.4% in Q1 to zero in Q3 and then posting a 0.3% decline in Q4. As a result, GDP growth in 2011 was just 0.7%, which went only a small way to reversing the cumulative decline seen in the previous two years.

• With the sovereign debt crisis now expected to lead to a 0.4% decline in Eurozone GDP in 2012, and additional fiscal austerity measures announced in February, Spain faces a prolonged period of recession that will last until the middle of 2013. Oxford Economics now forecasts GDP will decline by 1.2% in 2012 and by 0.6% in 2013, with industrial production seen falling 8.5% and 0.3% respectively.

• The Spanish car market continues to struggle along at a desparately weak level. The selling rate for the first two months of 2012 averaged just 800,000 units/year, slightly down from the market outturn in 2011 of 808,000 units. With no support coming from the economy in 2012, the market could well dip once again for the full year 2012.

• Through 2011, there has been a shift away from the smaller segments as was expected, as the impact on the market of scrappage incentive has been reversed. Year-on-year, collectively Basic segment (A) and Small segment (B) has seen market share decreased (0.6 percentage points) with the models such as the Hyundai i20 and the Ford Ka bringing the segments down. However we do expect the smaller segments’ to continue to see share creep up over coming years through product proliferation and an increasing focus on CO2.

• In the mean time, the Lower Medium segement (C) and MPV’s saw an increase in market share year on year. The Citroen C4 and the Ford C- Max provided the biggest boosts along with the Volkswagen Shiran for the MPV’s.

• The Volkswagen Group remains as the top selling manufacturer in Spain. It has also seen the biggest increase in market share year on year in 2011 rising 2.5 percentage points to 22.4%. The Ford group also saw an increase in market share in Spain in 2011. Share was up 0.7 percentage points for the year to a market share of 8.3%- the Ford C-Max providing the biggest boost.

• The General Motors Group saw the biggest fall in 2011, declining 0.7 percentage points. The Opel brand in particular accounting for this decreased result in 2011. Drilling down, among the models responsible for this fall is the Opel Insignia and the Opel Astra.

• Another heavy faller in 2011 was the BMW group falling 0.6 percentage points. The BMW X1 and the Mini Cooper being the biggest fallers. In terms of market share and in volume. The new BMW X3 should help the BMW group into 2012.

• Spain’s diesel car market remains steady at 70% of new sales. This figure remains incredibly robust whatever the vagaries of the car market overall. Spain is planning to be a leader in EV sales and this could impact on diesel demand in the longer term. However there is very little evidence of a thirst for EVs among the car buying public so far in Spain so we don’t see this as a bit threat to diesel during the first half of this decade at least.

Macro-economic background


• The Spanish economy slowed sharply through 2011, with the quarterly growth rate falling from 0.4% in Q1 to zero in Q3 and then posting a 0.3% decline in Q4. As a result, GDP growth in 2011 was just 0.7%, which went only a small way to reversing the cumulative decline seen in the previous two years.

• With the sovereign debt crisis now expected to lead to a 0.4% decline in Eurozone GDP in 2012, bond yields remaining stubbornly high, credit conditions tightening and additional fiscal austerity measures announced in February, Spain faces a prolonged period of recession that will last until the middle of 2013. We now forecast GDP will decline by 1.2% in 2012 and by 0.6% in 2013, with industrial production seen falling 8.5% and 0.3% respectively.

• The government is hoping that the short-term pain of its fiscal consolidation and reform plans will yield longer term benefits for the economy. But there is a real danger that the austerity measures become self-defeating in the near term, driving down economic activity further and hence making the budget deficit targets even more elusive. Against this background, our forecast for the coming year is characterised by a high degree of uncertainty.

• The near-term outlook for consumer spending appears bleak as real disposable incomes continue to fall due to ongoing fiscal consolidation, last year’s relatively high inflation and the steep rise in the unemployment rate, which was 23% at end 2011 and is expected to reach 25% later this year. As a result, we now forecast that consumer spending will fall by 1.4% this year and by 1% in 2013, by which time consumption will be around 8% below its pre-crisis peak.

• The risks to these forecasts remain on the downside. Despite signs of greater stability in the Eurozone in the last month, helped by ECB action and agreement of a new bailout deal for Greece, there are many uncertainties. The main risk still concerns Greece; any sign that it is unable or unwilling to adhere to the many conditions of its new deal could trigger fresh worries about the future of the Eurozone, and contagion could once again spread to the other peripheral countries. The consequences for the entire region would be severe, with the Spanish economy likely to be hit particularly hard.

Car sales

Of the major West European markets, Spain is certainly the one that is in the biggest hole. It failed to achieve a selling of over 900,000 units/year in any one month in 2011 and came up well short of the 2010 result for the 2011 full year (down 18% to 808,000 units). Of course, 2010 was, to some degree, a year of contrasting halves for the Spanish car market. The first half benefited from the scrapping incentives from the government and saw an average selling rate of 1.14 mn units/year, weak when compared to boom-era highs of over 1.6 mn units/year that were commonplace from 2004 onwards, though somewhat better than the second half of 2010, which achieved a selling rate of 800,000 units/year.The second half of 2010 was, of course, hit by the removal of the scrappage schemes as well as the increase in VAT but the selling rate failed to pick up much momentum in 2011.


The opening two months of 2012 have continued to reflect the tough challenges that the Spanish market faces. The average selling rate again came in at 800,000 units/year and, with the negative outlook for the wider economy, the going looks set to get even tougher. This leads us to forecast a market drop of 4 to 5% for 2012, which would be worse had the market not already made a drastic downward shift in volumes over the last few years.


The aforementioned boom period last decade, supported like much of the economy by an unsustainable bubble in property, can no longer be seen as in any way a normal level for the market in the near term. Certainly, wealth levels in Spain have risen dramatically over the past 15 years and a return to a level consistent with markets in the mid-1990s is unlikely. Furthermore, the car parc is currently around 50% larger than it was back in the mid-1990s and vehicle ownership has been seen, time and again, to be incredibly durable even in downturns. During sharp downturns, people choose not to replace their cars, but outright scrappage is avoided. With replacement demand being the largest element of overall vehicle demand in mature markets, this is how ownership levels can hold steady while new vehicle sales rise and fall, quite sharply on occasion. The consequence of this durability in ownership is that the trend level for the Spanish market is much higher than it was 15 years ago.


LMCA’s French Automotive Sales Forecast is the definitive forecasting service covering both cars and light commercial vehicle sales in the French market. Published quarterly as part of the LMCA European Automotive Sales Forecast which is widely used by the leading automotive manufacturers, it provides forecasts of sales by model over a time horizon of seven years into the future.

LMCA’s forecasts are built on macro-economic forecasts generated by our partner, Oxford Economics, and a detailed examination of demographics, fiscal and regulatory influences. This is combined with an in-depth analysis of each OEM, its strategies and its existing share of the market, both overall and segment-by-segment, as well as its roadmap for new model introductions. The French sales forecasts are provided by OEM, brand, market segment and model.
Clients to LMCA’s French Automotive Sales Forecast will receive the latest report in pdf format together with an electronic download of the data and forecasts, provided in annual timeslices. The electronic download is provided with filters and a pivot table.

Similar reports are available for Spain, Germany, Italy, UK and Russia.

LMC Automotive Spanish Automotive Sales Forecast – Quarterly

See also: Management briefings