The number of registrations of new cars in the European Union fell by 30.3% compared to the same period last year. According to the European Automobile Manufacturers Association ACEA , the fall continues for the fourth month in a row. Ukrainian dealers also suffer from a shortage of new cars. What awaits the car market next?
In Europe — falling sales of new cars
In October, 665,000 new cars were purchased in the European Union, which is 30.3% less than in the same month last year. The decline was recorded in the markets of almost all European countries, including the four largest: Italy (-35.7%), Germany (minus 34.9%), France (-30.7%) and Spain (-20.5%). ).
And this is not because buyers have lost the desire to buy new cars. The main reason is the global crisis of the automotive industry due to the lack of electronic components — semiconductors and microchips. In this regard, car dealers have problems with the supply of cars from factories and fulfillment of customer orders. As a result, sales are falling month by month.
In total, in the first 10 months of 2021, about 2.8 million new cars were purchased in the EU. This is still 2.2% more than in the same period of 2020. Sales increased year on year in three of the four key EU markets: Italy (+ 12.7%), Spain (+ 5.6%) and France (+ 3.1%). On the other hand, Germanyʼs results were 5.2 percent worse than the previous year.
In any case, so far 2021 is still somewhat more successful than the previous one. However, if the situation with automakers does not improve, the situation may change in November.
And what about Ukraine?
According to the Institute of Car Market Research, in October 2021, 8,186 new cars were registered in Ukraine. This is only 5.4% less than in October 2020. Most new cars are imported from abroad. In October, the share of cars manufactured in Ukraine was 11.4%.
In total, during the first 10 months of the year, Ukrainians bought 87,911 cars from the cabin. This is only 1% less than during the same period in 2020.
Sales of new cars in Ukraine — at a very low level compared to neighbors. For example, in neighboring Poland during January-October 2021, 378,564 new cars were purchased — four times more. The vast majority of cars Ukrainians buy used. In October, the share of new cars in the sales structure was recorded at a minimum level of 5.4%.
Ukrainians buy used cars mainly due to economic factors. In simple words — due to lack of funds. That is why the market for new cars has so far been shaken by the global crisis of the automotive industry — dealers have managed to meet demand, which is not great. However, this will not last long.
Whatʼs next?
The crisis of the automotive industry of this magnitude cannot go unnoticed. Its consequences can be:
- New cars are getting more expensive. Increased demand for any product always provokes an increase in its price. Electronic components are becoming more expensive — new cars are also becoming more expensive. Electronics in modern cars — a significant component of their value.
- Used cars are becoming more expensive. Those who wanted to buy a new car, not being able to do so, will drive longer on their used one. Or choose a minimally used car instead of a new one. What else will cause a shortage of used cars on the market, and hence — an increase in prices.
- Sales of new cars will continue to fall. Some potential buyers of new cars, not wanting to wait a few months for the dream car, may prefer cars with minimal mileage. This is the case when new cars can compete with one- or two-year-old used cars.
- More cars from China may appear on the market. The desire to win the trade war with the West, coupled with the global crisis, could help increase sales of Chinese-made cars. By the way, in October, in Ukraine, the Chery brand rose to three positions in the ranking of the most popular brands of new cars and took fourth place.
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