Thursday 18 December 2008

November car sales fall 36.8% (UK)


As a recession kicks in, new-car registrations for November in the UK fell to their lowest figures in 28 years. New car registrations are 37% lower in the UK when compared to November 2007.

Year-to-date volume in the United Kingdom is down 10.7% from the same period in 2007 to 2,023,104 units. The new Ford Fiesta was the UK's best selling model in November, just ahead of the Focus which remains the best seller over the first 11 months of the year. In total, the Fiesta sold 42,200 units with 50% of customers choosing upmarket trim packages in Europe.

"November has been another difficult month for the motor industry and whilst some consumers may have delayed their purchases to take advantage of the recent VAT reductions, overall demand continues to fall," said Paul Everitt, SMMT chief executive. "Urgent action is now required to ease access to credit and finance, both to support consumers and meet the cash-flow needs of the industry." Diesel sales were at an all-time high, accounting for 47% of overall sales. Private sales fell down to 45.1%.

UK top 10 sellers (Units):

Ford Fiesta/Focus - 6,154/4,893

Vauxhall Corsa/Astra - 4,442/3,003

Ford Mondeo - 3,739

Vauxhall Vectra - 1,981

Volkswagen Golf - 3,052

Peugeot 207 - 2,507

BMW 3 Series - 2,195

Audi A3 - 2,194

Only 100,333 new cars were registered in the UK last month, down from 158,735 from a year earlier. All automakers had a decline in UK sales. Volvo had the best sales figures, down 6.7% from a year ago. Renault did the worst, down 64%. The steepest falls in sales were noted at Chrysler (down 76%), Lotus and Aston Martin (both down 73%) and Mitsubishi (down 70%). Standing firmer were Volvo (down 7%), Jaguar (down 11%), Ford (down 12%) and Smart (down 14%).

The rest of Western Europe did just as bad. However, year-to-year new car registrations are down 50% in Spain, 30% in Italy, 18% in Germany, and 14% in France. That slide is the worst for Germany since its reunification, and the worst in Spain for 15 years.

French President Nicolas Sarkozy specifically pointed out the importance of the auto industry in that country when he unveiled France's economic stimulus package. The country will also offer €1,000 to anyone who buys a car that produces less than 160g/km. Consumers there will be given greater opportunities to finance a car purchase when France sets up a €1 billion fund to provide low-cost car loans.

European new car sales dropped by 25.8% in November as the economic downturn continued to hit the industry. The European carmakers' association, Acea, said it was the biggest fall in new car sales since 1999 - and the seventh monthly fall in a row.

Icelandic sales fell an eye-popping 94.6%, Ireland's sale had a 55.9% fall, while Spain's fell 49.6%. Many companies have cut output to cope with the downturn. This week, Seat and Volvo became the latest firms to announce temporary production halts.

In Western Europe, registrations were down 26% from a year ago to a total of 854,698 new vehicles in November. Acea said about a million fewer cars were registered in Western Europe in the period from January to November.

The body's figures said that November sales were down by 36.8% in the UK, by 29.5% in Italy, by 17.7% in Germany, and by 14.1% in France. Among the major European manufacturers, Germany's Volkswagen recorded a 17.4% drop in European sales in November, France's Peugeot Citroen saw a 26.9% fall, Renault's sales dropped 21.8% and Fiat saw a 23.8% decline.

Separately, Seat said it would cut production further at its main plant in Catalonia in the first half of 2009 in response to diving sales. The fall in sales is not just restricted to passenger cars as truck sales also fell. Volvo said it would stop truck production for 20 to 25 days in the first quarter of 2009.

Governments are rushing to support car manufacturers struggling to cope with falling sales and difficulties in shifting their stocks of unsold vehicles. On Monday, after a meeting with top industry executives, France said it was ready to take action in return for a commitment to keep production in the country.

Volkswagen remains the top-dog in sales figures due to the launch of the new Scirocco and continued popularity of the Golf. But despite a 5.5% increase in sales of the Golf this year, Volkswagen sales have dipped by 3.8%. Audi is the only manufacturer in the top 10 sales list to show an increase this year, up by 0.2%. This is due, in part, to the new A4, which not only ranks as the ninth best selling model but also has recorded a 16.6% rise in European sales so far this year.

BMW sales were down 9.2% for October in Europe. Mercedes-Benz cars were down 18.1%, their first decline in 15 years. GM Europe sales were down 12.3% for the third quarter of the year. Ford of Europe sales were down 12.4% for the month of October in its main 19 European markets.

Its not all bad, Finland’s economy, however, has shown remarkable resilience; sales are up 77.5% year on year and 9.5% on the year. Slovakia has fared even better; sales there have increased by 17.2% during 2008.

North America:

Toyota's U.S sales plummeted November as consumers continue to avoid dealer showrooms.

The Japanese automaker sold a total of 130,307 vehicles, representing a 33.9% fall from the same month a year earlier. The Toyota Division that includes the Scion brand posted November sales of 114,084 units, a decrease of 33.8% from last November while Lexus reported November sales of 16,223 units, a decrease of 34.7% from the year-ago month.

Toyota's passenger car sales were led by Camry and Camry Hybrid, which posted combined sales of 25,224 units. The best selling Scion vehicle was the xB with 2,161 units while Lexus sales were led by the RX SUV, which posted combined November sales of 5,850 units.

Recent reports by Porsche shows how bad car sales are. Porsche sold 1,493 vehicles in North America in November. Of these, 1,378 went to the United States and 115 went to Canada. The decline of 46% in comparison with the same period last year clearly shows that the Stuttgart sports car manufacturer cannot escape the general resistance to purchasing that exists in North America.

For the Boxster series, the decline of 73% also has to do with the product life cycle; the new generation of the mid-engine sports cars will make its debut in the United States and Canada in March 2009.

GM reported a decline of 41%, with Ford sales dropping 30%. Chrysler LLC fared the worst with a drop of 47%. Honda and Toyota fared well with a small drop of 32% and 34%. Nissan sales plummeted by 44% in November.


Sales of new cars in Japan and South Korea dropped by nearly 30% last month, confirming that the downturn in the car industry is global. According to data provided by the Japan Automobile Dealers Association, November car and truck sales in Japan fell 27.3% to 215,783 units from the same month a year ago, marking the worst November in more than 30 years. Sales of city cars with engines smaller than 660cc (0.66 litres) were down by 0.7% to 153,101 units.

Overall, the Japanese car market fell 18.2% in November from a year earlier to 368,884 vehicles. Japan's largest automaker, Toyota, saw its sales fell 27.7% while Honda dropped 21.6%, Nissan 29.5% and Mazda 33%.

In South Korea, domestic car sales in November plunged 27.2% to 74,217 units from a year earlier. The country's biggest carmaker, Hyundai, reported a 34% decline while sales at GM's Daewoo unit plunged 57%. Surprisingly, Kia, ranked second in South Korea, recorded an increase of 3.7% in car sales compared to last November.

Global car manufacture sales:

South Korea's Kia saw a rise of 10.1% in November to 1,272,689 units. November 2008 recorded 1,272,689 units, representing a 10.1% year-on-year increase and surpassing 2007 cumulative sales of 1,269,164 units.

Cumulatively through the first eleven months of 2008, China (134,176 units sold) and general markets (239,785 units sold) have experienced the largest year-on-year gains of 33.9%, and 32.2%, respectively. Cumulative sales increases have also been experienced in Korea (16.8% gain from 288,925 units sold) and Europe (0.7% gain from 315,172 units sold), while North America has experienced a relatively small decrease (6.3% decrease from 294,631 units sold).

Hyoung-Keun Lee, Senior Executive Vice President and COO of the International Business Division, said, "Despite these challenging economic times, Kia has still experienced growth. Through the month of November, Kia surpassed the 2007 cumulative sales figure and has experienced over 10% sales growth compared to only 3.5% for all of 2007."

In November, Kia announced that 99,731 vehicles were sold globally, a decrease of 13.9% compared to November of 2007. Kia posted year-on-year sales increases in general markets (23,516 units, 15.0% year-on-year increase) and Korea (26,145 units sold, 3.7% year-on-year increase). Meanwhile, in China, Europe and North America, 10,323 (0.8% decrease), 21,862 (33.4% decrease) and 17,885 (33.6% decrease) Kia vehicles were sold in November, respectively.

So far in 2008, Kia's best selling model in overseas markets has been the C-segment Cerato (known as 'Spectra' in some markets) with 178,198 units sold. The B-segment Rio takes second place with 143,392 units sold. Meanwhile the C-segment Cee'd and Kia's Sportage compact SUV compete closely for third place with 139,489 and 134,238 units sold, respectively. Rounding out the top five, the A-segment Picanto continues to perform well with 86,658 units sold. 623,008 passenger cars have sold so far in 2008, representing a 14.8% year-on-year increase.

Lee continued, "In November, Kia's compact SUV, the Sportage, was the number one vehicle sold globally, and strategic vehicles such as the Cee'd continue to perform well. With the launch of the all-new urban crossover Soul early next year, we are confident that Kia's product portfolio is well positioned to continue to stimulate sales growth in 2009."

The car-company, Ferrari has decided to take action by cutting its workforce by 10% and starting talks with trade unions to eliminate additional employees. This could potentially result in more than 300 people being laid off by the end of the week, with the chance of more layoffs in the future if market conditions fail to improve. Production at Ferrari's Maranello plant will also be stopped for 20 days during the upcoming Christmas holiday in order to keep vehicle inventory in check.

Perhaps the oddest thing about Ferrari's situation is that the company currently has a two-year waiting list but in some markets unsold cars are starting to pile up, particularly in the UK. Ferrari's chairman, Luca di Montezemolo, had previously stated that the company wouldn't feel the pressure from the economic crisis, as a decline in sales in one market would free up cars for markets with higher demand and long waiting lists.

According to sources sales of the 612 Scaglietti and 599 Fiorano have essentially flat-lined, and sales of the volume leader F430 have all but disappeared thanks to the unveiling of the similarly priced Ferrari California.

A company spokesperson attempted to dismiss the reports countering that luxury vehicle sales typically decline towards the end of the year and that Ferrari's U.S sales have only slowed a little. However they did admit that the company currently has a vehicle stockpile in the UK and the introduction of the California has put a serious damper on sales of the F430 Spider.

The continued market downturn resulted in a significant decline in sales in November for the BMW Group that consists of the BMW, MINI and Rolls-Royce brands. The automotive group saw its global sales in November plunge by 25.4% to 96,570 units compare to 129,459 the same month a year ago. From the beginning of the year, the BMW Group has delivered a total of 1,323,572 vehicles, down 1.8% from the first 11 months of 2007. In November, BMW brand car sales were down 26.2% to 81,357 units, MINI sales fell 20.8% to 15,103 while Rolls Royce reported a 18.5% decline to 110 vehicles.

For the first 11 months of the year, global sales of BMW brand vehicles are down 3,5% to 1,105,112 units while MINI's are up by 7.6% to 217,405 as are Rolls Royce's by 28,5% to 1,055 vehicles .

Ian Robertson, Member of the Board of Management of BMW AG, responsible for Sales and Marketing, said "Global automotive market demand fell once again in November. However, during the period to the end of November the BMW Group performed better than the overall premium segment and has increased its market share in the segment. In addition two of our three premium brands – MINI and Rolls-Royce – continue their growth over the 2007 sales results. The MINI brand is still the world's fastest-growing premium brand."

BMW's M-Division is flourishing in this harsh economic environment having exceeded the previous year's equivalent figures during the first 11 months of 2008 by over 50%. From January to November 2008, BMW has sold 22,340 M-Model cars worldwide compared to 14,092 vehicles in the same period in 2007. In November 2008 alone some 1,900 BMW M automobiles were delivered around the globe. As long ago as August 2008 the worldwide sales figures of BMW M GmbH reached 16,150 units, thus surpassing last year's total figure of 16,128 units.

"The fact that our dealers were able to supply significantly more vehicles than the average of the last nine months even in such dramatic times for the world economy demonstrates the fascination and attraction which BMW M automobiles exercise on our customers," said Ludwig Willisch, President of BMW M GmbH.

A major contribution to BMW M's runaway success in 2008 has been the introduction of the all-new M3 which is now offered in three body variations (Coupe, Sedan and Convertible). The high-performance sports car sold almost twice as well in its first year of production than its predecessor model did within the same period.

Currently, BMW M offers seven models that include three body types of the M3, the BMW M5 Sedan and Touring as well as the M6 Coupe and M6 Convertible.

Overall, BMW brand sales in 2008 for the first 11 months of the year, are down 3.5% compare to the same period in 2007 to 1,105,112 units.

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