ABSOLUTE clarity about the state of the New Zealand new car market in 2020 might be weeks away from resolution, but first indications about how the industry fared globally are sobering reading.
Gut feeling from within the industry here is that there’ll be no surprise should the year-total new car and light vehicle registrations count come to around 117,000 units, so around 20 percent down on the 2019 tally and the lowest annual count since 2013.
That kind of decline would be slightly greater than those predicted for the world’s three largest car markets – the United States, China and Germany.
But all has yet to be clear. New Zealand industry participants are awaiting one more set of figures, the registrations count for December, before they can achieve a total picture of the year’s trends and activity.
As is always the case, this data doesn’t come easily - simply because the Government department involved in the accrual process, Land Transport, closes down over Christmas and New Year.
It is likely that provisional counts might be availed on January 5, but unlikely that full counts will be availed before January 11 – a much slower turnout than for any other month of the year, when normal business conditions apply.
That won’t inhibit individual brands from calculating their own in-house data – they, of course, know exactly how many cars they have retailed at any given time – but does make the achievement of a big picture view much more challenging, as competing brands are quite naturally loath to share.
Even so, the global picture is starting to take shape and it might well provide a pointer as to how the NZ scenario will shape up.
In which case: Don’t expect an easy ride. The impression that NZ has done okay, simply because we experienced an unexpected surge in new vehicle purchasing activity in the months immediately following the easing of national lockdown conditions from April, does not mean that the market is set to show a decent result.
The big problem, evidenced especially within the final quarter of the year, has been one that should be pretty obvious to anyone who has been visiting new car franchises these past few months. The decreasing count of vehicles on display – and the increasingly obvious amount of unfilled display space -speaks volumes about how constrained supply has become.
Fact is, the vehicles that were bought during that sales rush were all easy pickings, being by and large, examples held in the national stockpile.
What’s become more challenging is achieving replacements for those units – Covid’s interference with not only car-making but component provision and then supply networks has been dramatic. Plants might still be making vehicles, but the rate of production has slowed and, often, so too the processes.
Coronavirus has given the world’s car makers a really rough ride in 2020; according to one report just out from an analyst based in the United Kingdom, all signs are that global car sales were down by $612 billion in 2020 and the entire market appears to be down by 10 percent.
Data presented by StockApps.com, based on collations by a specialist, Statista, confirm what has long been accepted fact – that the Covid-19 pandemic hit the industry hard, causing supply chain disruptions, factory closures, and huge sales and revenue drops.
StockApps picks the downsizing trend is set to continue this year and next, pointing out that even before the pandemic, the world’s car makers were already coping with a downshift in global demand.
In 2019 global passenger car sales revenues amounted to $US2.29 trillion. Small SUVs sales, as the largest revenue stream, generated almost 30 percent of that value or $US647 billion.
Large SUVs and large cars segments followed with $US362bn and $US275bn in revenue, respectively.
However, the COVID-19 pandemic caused a huge hit, with total car sales revenues falling by almost 20 percent year-over-year to $US1.85trn in 2020.
Statista says its data suggests revenues in the large cars segment are expected to drop by 25 percent year-on-year, to $233bn.
Large SUV sales are set to witness a 24 percent cut, with revenues falling to $US275bn in 2020. Small SUVs follow with a 20 percent drop and $525bn in revenue.
Analysed by carmakers, Toyota represented the market leader with a 10.6 percent global market share in 2020. Volkswagen ranked second with a 7.4 percent market share. Nissan, Ford, and Hyundai follow, with 6.6, 6.2 and 5.6 percent shares respectively.
Statistics show the downsizing trend is set to continue in 2021, with global passenger car sales revenues falling to $US1.65trn. In 2022, this figure is expected to decrease by another six percent to $US1.55trn.
Statista data also revealed that all of the leading car markets are expected to witness a two-digit revenue drop this year.
As the largest market globally, the car sales revenue in the United States is forecast to fall by almost 18 percent year-on-year to $US507bn. This figure is expected to plunge to $US385bn in the next two years, nearly 40 percent less than in 2019.
China, the second-largest market globally, achieved $US452bn in revenue in 2020, an 18 percent fall year-over-year. By 2022, total car sales revenues in China are set to drop to $US405bn.
As the third-largest market, Japan witnessed an almost 19 percent year-on-year drop when comparing 2020 and 2019 data sets, with passenger car sales revenues falling to $US92bn in 2020. Germany follows with $US86.5bn in revenue, 17 percent less than in 2019.
In all, the three leading markets have likely lost $US231.5bn in car sales revenues in 2020 due to the Covid-19 crisis.
