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Major EU car markets report a decline, and automakers cut production

Major EU car markets report a decline, and automakers cut production

For several months there has been a drop in sales of passenger cars in the EU. In October, the number of registered new cars fell by 30.3%. Major automakers temporarily shut down some plants. 

According to the European Automobile Manufacturers Association (ACEA) data , there was a decline in demand for new cars to 718,598 units in September (-23,1%). This is one of the lowest monthly totals in 25 years. The decrease has been observed for the fifth consecutive month since July 2021.

New car registrations totaled 665,001 units in October, representing a 30,3% drop compared to October 2020. Major EU auto markets show double-digit drops: Italy -35.7%, Germany -34.9%, France -30.7%, Spain -20.5%.

Still, total demand in the EU has increased by 2.2 percent over the past 10 months compared to the previous year. The boost in new car registrations occurred in the spring and summer. The record positive figure was registered in April, namely, 862,226 (+218,6%).

The Association of European Businesses (AEB) predicts a further negative trend in the automobile market for the next few months.

The lowest sales ever recorded, as well as problems with the supply of components, have forced most car companies, including BMW Group, DAF Trucks, Ferrari, Daimler, Ford of Europe, Hyundai Motor Europe, Renault Group, Stellantis, Toyota Motor Europe, Volkswagen Group, Honda Motor Europe, CNH Industrial, Volvo Cars, and Volvo Group, to suspend production lines or entire plants temporarily. 

The main challenge in supplying components is the worldwide lack of semiconductors. The reason for such shortage was the reorientation of chip manufacturers to create boards for consumer electronics like computers, video cards, smartphones. The reorientation occurred because of the drop in car sales across the world following the rapid spread of the COVID-19 virus. However, a year later, when the production was relaunched, chip makers did not have time to return to making chips for cars, causing their lack.

 

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