EU new passenger car sales rebound strongly in August

LONDON (ICIS)–EU passenger car sales saw strong year-on-year growth in August, following a contraction in July in the immediate aftermath of the UK’s vote to leave the EU, data from the European Automobile Manufacturers’ Association (ACEA) showed on Thursday.

The July fall in year-on-year sales of 1.4% ended a run of 34 consecutive months of growth, but had been expected given the uncertainty and raft of negative macroeconomic forecasts following the so-called ‘Brexit’ vote.

However, more positive macroeconomic data in August led to a 10% increase in passenger car sales year on year, which may also have been boosted by latent demand from consumers delaying purchases in July.

The August sales increase was led by southern Europe – which has seen strong passenger car sales growth throughout most of 2016 because of a broader macroeconomic recovery in the period – with Italy registering 20.1% growth year on year, and Spain 14.1%. Germany saw growth of 8.3%, France of 6.7% and the UK a more modest 3.3%.

In the first eight months of 2016, EU new passenger car sales rose by 8.1%. Growth across the EU and the European Free Trade Association (EFTA) was lower at 7.8% in the first eight months, as a fall in sales in Switzerland of 4.4% weighed on EFTA sales figures.

The rise in the majority of the August ICIS Automotive Chemical Market Confidence Index (CMCI) for Europe suggests that petrochemical players are confident that automotive sales growth will continue in to the second half of 2016.

The automotive industry is a major global consumer of petrochemicals which contributes more than a third of the raw material costs of an average vehicle. ICIS tracks the movement of petrochemical raw material costs in auto production both globally and regionally with the weighted ICIS Basket of Automotive Petrochemicals (IBAP).

ICIS produces a monthly Global Automotive report covering the major automotive chemicals markets, the auto-industry, the IBAPs and macroeconomic trends. For more information on the report and details on how to subscribe, please click here.