Europe’s New Car Sales Speed to Record High in Last Years

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Europe continued to post strong annual new car sales increases in the last year. New data released by industry association ACEA found that European Union (EU) new car registrations increased 8.5% to 12,759,000 units sold in 2018, an all-time record for the region.

This is the highest number of cars ever registered in Europe over a 12 month period. The number of registrations was up 9% above 2017 levels and represents a milestone for the region’s automotive market following many years of unparalleled growth.

Pietro Gorlier, chief operating officer at the European Automobile Manufacturers Association (ACEA), said “The strong demand for new cars is continuing unabated. 

We are witnessing a record high in every respect: there were more car registrations than ever before, each month was also a record-setter, and all major markets contributed to this positive development.”

The European New Car Market in 2018

Year-on-year change %* EU 28 +8.5 UK +4.3 Germany +7.2 France +6.1 Italy -0.1 Spain 3% Poland 23%

The UK recorded the lowest number of new registrations, although this is in part due to the market going through a recent drop-off. 

In January 2018, registrations fell 4.6% which could be attributed to the significant decline in sales seen when vehicle excise duty (VED) rates were increased in April 2017 when last year’s figures are compared with this year’s opening month.

In contrast, the UK market enjoyed a strong finish to 2018 with December’s registrations up 10.5% from 2017, bringing total sales for 2018 to 2,264,000 units which is a 7.2% increase on the year before.

In Germany, new car registrations increased by 7.2% in 2018 and have been stronger for six out of the past seven years. The market in France increased by 6.1% in 2018, Spain’s registrations rose 3%, Italy’s fell 0.1% while Poland was up 23%.

However, there are some weaknesses within Europe’s car market that are expected to surface in 2019. Germany recorded its lowest growth since 2009, France recorded its lowest growth rate since 2011 and Spain saw a significant drop in demand. 

This could be due to the uncertainty surrounding Brexit as well as growing fears that there might be an economic slowdown after many years of stable or even increasing growth.

Europe’s manufacturers are also concerned about the changes to new car registrations which are expected in the future, including stricter emission testing procedures and a shift towards less polluting cars. These changes are expected to prove more difficult for larger vehicles such as SUVs which have been responsible for a large portion of growth within Europe’s car market in 2018.

Although new car registrations across Europe experienced a positive year, there was also growth in the used car market. This industry has seen an increase of 4% to 41,600,000 vehicles sold in 2018.

Gorlier commented that “The increasing popularity of pre-owned vehicles is something we should not consider as a threat but rather, like for example digitalization and electrification, as an opportunity for manufacturers to sell more cars.”

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