Western Europes new car market is forecast to nudge up by 1.6% to 14.5m units in 2018

Western Europe's new car market is forecast to nudge up by 1.6% to 14.5m units in 2018

Data from LMC Automotive shows that West European car registrations increased by 9.1% in year-on-year (YoY) terms in July. The regional annualised selling rate also nudged up, from 14.6m units a year in June to 14.7m units a year in July.

Most of the major national car markets turned in good rates of growth in the month and analysts suggested some of the market strength is explained by pulled forward sales ahead of the looming WLTP emissions testing regime.

The Spanish market continued to be a strong performer in July, as new car registrations surged by 19.3% against last year. In France sales were up by 18.9% YoY, with the selling rate almost reaching 2.3m units a year. New car registrations in Germany jumped by 12.3% in July, with the selling rate reaching a remarkable 3.8m units a year. In Italy, sales were up 4.4% YoY, although the selling rate was little changed at 1.9m units a year. UK car sales grew by 1.2% YoY, in line with expectations, with the selling rate unchanged at 2.4m units a year.

LMC said its full-year forecast has been revised up very slightly since last month - with growth of 1.6% taking the West European car market to 14.5m units. However, LMC also cautioned that there is a strong suspicion that the surge in registrations is related to the 1st September deadline to register cars under the existing NEDC emissions regulations rather than the more stringent WLTP legislation. Therefore, there should be some payback in the later months of the year, restraining growth for 2018 overall, LMC said.

LMC also noted that in Sweden, sales fell dramatically last month (-49.4%), but said this was expected after a significant pull-forward effect in June to avoid higher taxes introduced from 1st July.

Speaking to just-auto, LMC analyst Jonathon Poskitt said that there are still some uncertainties surrounding the full impact of WLTP, but it is bringing forward sales as some manufacturers look to make sales on certain model lines - and clear stocks - ahead of its introduction in September. "The exceptionally strong German car market in July indicates that WLTP considerations are already at work," he says. "We think it will be even more pronounced in August and if there is a very big pull-forward effect, demand in subsequent months will be much weaker."

West European car market, July 2018

July 2018July 2017%chYTD (1-7) 2018YTD (1-7) 2017%ch
WESTERN EUROPE118683210880719.1912517188667042.9
AUSTRIA315522780113.52249152148274.7
BELGIUM427713662716.83741403589294.2
DENMARK16449152088.2137166139005-1.3
FINLAND957988508.279163732998.0
FRANCE17539614751618.9136357712829636.3
GERMANY31784828307412.3215687920700684.2
GREECE10073781928.8706455661424.8
IRELAND2694427707-2.8114095118922-4.1
ITALY1523931459104.412737301282963-0.7
LUXEMBOURG493145298.935582334756.3
NETHERLANDS362633243611.828930225841112.0
NORWAY961111476-16.38635689459-3.5
PORTUGAL199611757213.61544671447046.7
SPAIN13117610994219.386582277740011.4
SWEDEN1250424772-49.92380472182459.1
SWITZERLAND25483248852.4183393183803-0.2
UK1638981619971.2147789215638085.5

Source: LMC Automotive

West European annual car sales, 2012-2018F

Units (m)%ch
201211.76null
201311.53-1.8
201412.14.9
201513.188.9
201613.955.8
201714.32.5
2018F14.531.6

Source: LMC Automotive (July, 2018)