Volkswagen does not expect European sales volumes to increase at any point during the next few years as overall economic gloom continues to grip the Continent.
Addressing delegates at this year’s European Automotive Congress in the Basque city of Bilbao in northen Spain organised by European Conference Management, Volkswagen procurement board member, Francisco Javier Garcia Sanz, underlined the challenges facing the sector in the current financial climate.
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“The last 14 months – the news we have received from the Euro has been pretty negative,” said Sanz. “We don’t expect to reach the end of this recession [yet].
“Europe in the last few years produced 12m cars and this is the lowest sales figure for the last 20 years – we don’t think this figure will increase in the next few years.”
Sanz highlighted the growing number of unemployed young people in Europe with several Mediterranean countries reporting out of work figures for that generation approcaching or reaching 50%.
“Spain is losing a complete generation of youngsters and we will lose them even more if we do not change,” said Sanz. “We are running the danger of all western Europe collapsing and ending in a recession.
“The future will focus on China, India, America and South America [as well as], south and eastern Asia.”
Sanz cited the UK as a market that was setting the automtoive pace in Europe with the country a net exporter of vehilces for the first time in almost a generation.
“We as an industry have to become much more global,” said Sanz. “The automotive industry is an industry of industries because it also drags along a service society.
“[What] we have to do is go back to the roots. Go to the UK and see what is happening there.”
Sanz also reserved praise for the Spanish automotive sector, which has seen significant challenges but which has also proved attractive for some European OEMs, who view the country as ripe and hungry for business.
“We are not doing everything badly,” he said. “We have improved on the labour front and I think we have all improved things and so have suppliers.
“I know our plants are the most productive of their kind in Europe – they have quality standards that are just like other faciliites outside Spain.”
