The country where the pandemic outbreak began seems to have come out of the crisis earlier than others, with the automotive market recovering especially in the premium segment.
In the third quarter of 2020, for example, Volkswagen reported 5.4% increased profits connected to the demand for luxury cars in the Chinese market, which helped to offset the decline in global vehicle deliveries caused by the ongoing pandemic. With Europe struggling with the second wave and the rest of the world not faring better, China seems to have eradicated Covid-19 by restarting its economy in record time. The recovery seems particularly evident in the premium and luxury segments, where Mercedes-Benz also benefits by announcing a 24% record increase in the Chinese market and increased profits. Outside of China, the situation in the automotive market is still difficult and all manufacturers are complaining significant losses, with still difficult forecasts in terms of trend reversal.
“The coronavirus remains a crucial problem, the situation is far from being resolved”, said Frank Witter, president and CFO during of Volkswagen, during a recent conference call. There is the awareness of not being out of the tunnel, but the German car group reiterated that for 2020 it expects to record a recovery thanks to China, with Audi and Porsche sales increased by 3%. According to the latest data released by ACEA, the association of European manufacturers, in October new car registrations in Europe amounted to 1,129,223 units, a decrease of 7.1% compared to October 2019. Since the beginning of 2020, new car registrations in Europe fell by 27.3% (9.6 million units) compared to the same period last year. After the ‘awakening’ of the market in September with the first positive sign, in October the minus sign returned (-7.8%) in Europe.
An aspect to point out is the Italian market which fell by only 0.2% to 156,978 cars registered while negative numbers come from other large countries: in Spain there was a collapse (-21%), strong declines also in France (-9 , 5%) and Germany (-3.6%).