The car market: in crisis, sales of new cars have fallen by half a million since 2019 in France

A drop of more than a third compared to 2019, that is 500,000 lost cars. New vehicle sales have not recovered from the Covid-19 pandemic and its consequential damage to industry, logistics, inflation and energy. The market is down, and the buyers, when they have not postponed their purchase project indefinitely, do not really know which saint to devote to themselves, which motorization to privilege. This weekend with open doors in concessions, while the Mondial de Paris, even amputated by many manufacturers, begins on Monday, an overview of a situation whose outcome does not seem to be outlined.

The little phrase circulates among car salesmen, ironically, bittersweet: “We were fishermen in a school of sardines. Today we are trout fishermen!”and the risk of returning empty-handed has increased significantly.
In fact, since 2020 it has not been easy to sell a new car, this market has been severely affected by a series of crises that cross a deep change in the sector: the planned abandonment of the heat engine.

1 – The worst numbers since 1975

It should this year sell less than one and a half million passenger cars in France, for the first time since the first oil crisis, 1975. And if the market recovered in August and September, it improved by 5.46% compared to the same month of 2021, this is increase a sham after fourteen consecutive months of decline.

Market (VP)? ?? | In September, the market, which shows +5.4% per/2021, is still far behind the level before the crisis, evening a ↘️ of -18.6% per/2019.
Over the first 9 months: ↘️ -32% per / 2019.https://t.co/8pLN8Mwktk

— Automotive platform (@PFA_auto) 1 October 2022

“After a first half of 2020 in which we did almost nothing, recalls François Roudier, spokesman for the Automotive Platform, which brings together manufacturers and equipment manufacturers, we saw the market recover a bit and gradually run out of steam. It is a third lower than it was in 2019.” Precisely, 32% of registrations increased over three years in France, in a broadly similar European context. In the same period, this market fell by 26% according to ACEA, Association of European Automobile Manufacturers.

“Which does not at all prevent a group like Stellantis from achieving record profits”solve Yves Carra, expert in the Automobile Club Association.

2 – Cars whose prices are sky high

The spokesman for this institution as old as the automobile, founded in 1900, which claims a million members, makes a deliberately sharp speech: “Producers no longer know what to make, sellers what to sell, and customers what to buy!”

The successive crises, Covid-19, shortage of electronic components, energy costs, inflation, combined with the automotive industry’s shift towards electrification, have destabilized things. To put it simply: When production resumed, after lockdown, the manufacturers were left without a chip, “around 500 per vehicle at the momentemphasizes François Roudier. This problem continues, it should not subside until 2023.” Without these semiconductors, lead times and manufacturers exploded “high-margin preferred models compared to entry-level models. These are almost non-existent in sales, average price has increased”analyzing the PFA’s vote, so “daunting”judge Yves Carra.

But what was circumstantial “seems” must endure. “The electrification and hybridization of small vehicles leads to a 30 to 40% increase in their price.” François Roudier admits that, “This constitutes a real societal problem”makes buying a new car unaffordable for more and more customers and drives up used prices…

3 – New buyers are lost

“People are completely lost, there are too many uncertaintiessighs the general delegate of 40 million motorists, Pierre Chasseray. They don’t know what to buy“, therefore a wait-and-see attitude, which also weighs on sales, he believes.

Electric, hybrid, plug-in hybrid, petrol: the choice is not easy, complicated by the new unknown electricity price, reductions in the conversion premium, the issue of battery charging: “In Sète, which I know a little, says Héraultais, every fifth inhabitant actually has access to a socket. No parking, no socket, no socket, no electric car.” The equation becomes even more complicated where low-emission zones are established with their deadlines. “Social Time Bombs”condemns Yves Carra.

Luc Chatel: “The French need the car” #Economy ? https://t.co/pxJzwzYQMC

– Le Figaro Economy (@Figaro_Economie) 14 October 2022

Meanwhile, the car fleet is aging, the average age is close to 11, not good for the planet.

4 – The industry takes hits

From upstream to downstream, from the manufacturer to the distributors, this downturn and this change are not without effects. On the industrial side, “The job is pretty well donenotes François Roudier, including interim. On the other hand, the switch to electricity puts 40,000 to 100,000 jobs at risk, depending on whether we get the opportunity to bring the manufacture of motors and batteries home or not.

In concessions, if “We are going through a difficult periodanswers Jean-Louis Besnard, Herault delegate for Mobilians, there has been no bleeding on the job side: our halls are not empty of customers.” The union had surveyed its members in May, in May 43% of dealers were considering reducing their workforce. The situation is fragile.

Change of scale

This is no longer the huge appointment in honor of the car, the times are over for that. The exhibitions have all folded their sails, the Mondial de Paris is doing the same. Finished millions of visitors in 2018, the exhibition spread over thirteen days, the show that begins this Monday with the day reserved for the press, before the opening to the public on Tuesday morning, must also count on the absence of leading producers. The Germans BMW, Volkswagen, Audi and Mercedes have dropped out, Toyota No. 1 in the world too, as well as the American Ford and even the Stellantis group is partially stuck, Opel and Alfa Romeo are not moving to the halls of the Versailles gate. Brands that we find on the other hand at the Auto/Motorcycle Ecomobility and Utility Show in Montpellier, from November 25 to 27, organized by L’Agence and Midi Libre at the exhibition center.

In Paris, French manufacturers will therefore attract attention with the new Peugeot 408 in the main role, the future Renault 5 and Renault 4 presented in the form of prototypes, the Citroën OLI, which looks like it came out of a Lego box. Around these generalists will gravitate a large number of new brands driven by electricity, hydrogen and innovation in general.

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