Greece’s problems lead to EU auto industry job cuts

Consumer demand


PIIGS autos Feb12.pngGreece’s debt default saga seems never-ending. And it is tempting to hope that it only matters to those suffering in Greece and the PIIGS countries (Portugal, Italy, Ireland, Greece, Spain).

But a look at auto sales trends since 2005 gives a different picture. As the chart shows, based on ACEA data, sales in the 5 PIIGS countries have seen a sharp decline since the crisis began:

• 4.8m autos were sold there in 2007, 31% of total EU sales (blue column)
• Only 2.9m were sold in 2011, a fall of 39%
• Italy’s sales (green line) were down 30% to 1.7m
• Spain’s (red) were down 50% to 0.8m
• Portugal’s (orange) were down 24% to 0.2m
• Greece’s (purple) were down 65% to 0.1m
• Ireland’s (brown) were down 52% to 0.1m

It is also clear that further declines are inevitable, as earlier stimulus such as ‘cash for clunkers’ is replaced by austerity programmes. Those losing their jobs in the public sector, or seeing their pensions reduced, will suffer a permanent loss of purchasing power.

Even more worrying is that a vicious circle is now underway. Jobs are starting to go in the private sector within the PIIGS, and amongst EU companies who supply there, further damaging the sales outlook:

• Italian auto maker, Fiat, sold 928k cars in 2011, versus 1.2m in 2007
• France’s PSA, the EU’s 2nd largest manufacturer, sold 1.6m versus 1.9m
• Renault COO, Carlos Tavares, has suggested current price wars could lead to a major bankruptcy
• He added “you cannot continuously be in the red. Somebody some day has to pay for it.”

Already PSA has announced 6000 job cuts, and said that production needs to be cut short-term to conserve cash-flow. Whilst
Fiat CEO Sergio Marchionne has warned that Europe needs to “cut 10% – 20% of its car manufacturing capacity”.


US PE exporters face more competition in Brazil


As promised, the blog looks today at the performance of US polyethylene (PE) exp...

Learn more

Déjà vu all over again in petchem markets


This time last year, the petchem industry stood on the edge of an unseen precipi...

Learn more
More posts
Smartphone sales continue their decline, whilst $25 smart feature phones open up new markets

Global smartphone sales have now been falling for 8 consecutive quarters, since Q3 2017. They are no...

Smartphone market decline begins to impact global stock markets

The bad news continues for the world’s smartphone manufacturers and their suppliers.  And Pre...

There’s a great future for the European plastics industry in recycled plastic

Europe’s plastics industry is under major threat from the growing legislative and consumer bac...

$60bn opportunity opens up for plastics industry as need to eliminate single-use packaging grows

150 businesses representing over 20% of the global plastic packaging market have now agreed to start...

IKEA heads into the circular world with furniture subscription trial

“Once upon a time, Granny and Grandad used to go to a large shop on the motorway to buy their ...

Fed’s magic money tree hopes to overcome smartphone sales downturn and global recession risk

Last November, I wrote one of my “most-read posts”, titled Global smartphone recession ...

Global smartphone recession confirms consumer downturn

Q3 smartphone sales data show the global market in recession, as Strategy Analytics confirmed: “Th...

Trump’s auto trade war adds to US demographic and debt headwinds

President Trump’s auto trade tariffs are bad news for the US and global auto industry, as the ...


Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more


Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more