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Western Europe’s new car registrations fell by a colossal 52.9% year-on-year (YoY) in March and the regional annualised selling rate dropped to just 6.6m units a year, according to data released by LMC Automotive.

A fall of this proportion is unprecedented in what is seen as a mature and stable regional market. The spread of coronavirus COVID-19 now dominates regional woes, with widespread government-imposed lockdowns, and subsequent plant closures, having profound effects on both the demand and supply side of the automotive industry.

In Italy, new car sales contracted by 85.4% YoY, while the selling rate plummeted to just 266,000 units a year. March saw Spanish registrations fall 69.3% YoY, with a selling rate of just 361,000 units. Similarly, French new car registrations were down 72.2% YoY, with the selling rate managing just 616,000 units a year. For the UK, sales were 44.4% lower YoY — the selling rate dropped to 1.3m units a year.

In Germany, the selling rate fell to 2.1m units a year, with volumes down 37.7% YoY. 

LMC said the initial weak start to the year for registrations, related to a pull forward into December 2019, has been dwarfed by the devastating impact of the spread of COVID-19. It said its base case assumes a V-shaped recovery once the spread of the virus across the region is brought under control, with selling rates picking up through H2 2020. LMC’s annual forecast for 2020 is currently pencilled in at 11.7m units, but with extended or further lockdowns through the year, the market could fall well below levels seen during the last Eurozone Crisis (11.5m units in 2013).

Interestingly, the Swedish car market saw a comparatively modest fall of 8.6% last month — the ‘softer’ approach by the government on national lockdown reflected in a somewhat lower YoY fall than seen elsewhere.

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By GlobalData

LMC analyst Jonathon Poskitt said: “The outlook for car sales in Europe is closely tied to what happens to the region-wide public health crisis. We have yet to get any real certainty to timelines on exits from lockdowns in major markets. A recovery to regional sales in the second half is our central case, but there is considerable variability around that.” 7