European Car Market Update
There is encouraging news in the car market. After a notable rise in Spain, registrations climbed by 9.1% in August, while the broader European market advanced by 4.4% for the month, according to data from the European Automobile Manufacturers Association (ACEA). In total, 650,305 units were sold in August, though the year remains challenging, with 5,996,638 vehicles registered through August, reflecting an 11.9% decline from the same period in 2021.
ACEA notes a solid performance across most markets in August, although five smaller markets posted declines. The four largest markets showed gains: Spain up 9.1%, Italy up 9.9%, Germany up 3%, and France up 3.8%. Outside the European Union, the United Kingdom finished the month with a 1.2% rise. Notably, the Swiss market reached last year’s figure with 16,456 vehicles sold, a surprising development given broader market pressures.
Despite these positive signs, European manufacturers continue to face headwinds from the ongoing chip and component supply crisis, inflation, and the war in Ukraine. These factors are shaping a difficult backdrop for the year-to-date performance. The four major markets all recorded declines from January through August, with Spain down at least 9.4%, followed by Germany at -9.8%, France at -13.8%, and Italy at -18.4%. The United Kingdom also saw a drop, with a year-to-date decrease of around 10.7%. Overall, only a handful of smaller markets posted gains in 2022.
Group Performance in August
For most of the year, the Hyundai-Kia group leveraged stock availability tied to its chip reserves, ranking alongside Honda as a leading non-Japanese producer that delivered positive results between January and August. However, August brought a shift, and Hyundai-Kia finished the month down by 0.6%, ending a period of relative strength amid stock clearance strategies.
This August, the Volkswagen Group held the top position with 172,017 units sold, up 7.9% from the previous year. Stellantis followed with 111,681 units, a rise of 10.6%. Hyundai-Kia remained competitive, placing ahead of Renault Group with 62,082 units and 61,216 units, respectively. Several brands within the major groups faced declines, including Fiat (-2%), Jeep (-48.7%), Mitsubishi (-36.2%), Honda (-12.7%), Toyota (-26.9%), and Smart (-69%) under Mercedes-Benz AG. Among Volkswagen Group brands, Seat reported 18,231 units sold, showing a 4.5% increase.
Across the broader market, the dynamics of supply, demand, and brand strategy continue to shape monthly results. While some manufacturers benefited from inventory positioning, others faced adjustments in model mix and regional demand shifts that influenced August’s overall performance. The narrative among buyers and industry watchers centers on balancing production capability with consumer demand, amid ongoing macroeconomic headwinds and regional variations in market conditions.