Lighthouse Investment Management

Euro Car Reg Tracker

European New Car Registrations

December 2013

European New Car Registrations - December 2013

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Contents
European Car Market: Overview .................................................................................................................. 3 2013 New Vehicle Registrations by Country:................................................................................................ 6 Passenger Cars: Top 5 ................................................................................................................................... 8 Passenger Cars: Top 5 (indexed) ................................................................................................................... 9 Passenger Cars: Top 6-10 ............................................................................................................................ 10 Passenger Cars: The PIIGHs......................................................................................................................... 11 Passenger Cars: Best Markets ..................................................................................................................... 12 Commercial Vehicles: Major Countries....................................................................................................... 14 Commercial Vehicles: Top 5 Countries (indexed) ....................................................................................... 15 Commercial vehicles: Top 6-10 Markets..................................................................................................... 16 Commercial Vehicles: The PIIGHs ............................................................................................................... 17 Commercial Vehicles: Eastern Europe ........................................................................................................ 18 Total EU Market (indexed) .......................................................................................................................... 19 Total EU Market (% yoy) ............................................................................................................................. 20

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European Car Market: Overview
The European automobile industry1 Largest vehicle production in the world (17.7 million passenger cars, vans, trucks, busses, 22% world market share)2 60m passenger cars (26% world market share) Revenue: EUR 625bn3 Exports: EUR 104bn Employment: 2 million direct jobs + 10 million in related manufacturing and other sectors (5% of EU employed population)

For Germany, the automotive sector is an important driver of employment4

Within the EU, Germany produces around 37% of all passenger cars and 41% of all trucks. Excluding new additions to the EU (Czech Republic, Hungary, Poland, Romania, Slovakia, Slovenia), the production of passenger cars in the EU in 2011 was below the level seen in 1990.

1 2

Europe = EU27 Source: ACEA (Automobile 3 2011 4 Eurostat 2010

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Within a decade, the BRICs (Brazil, Russia, India, China) grabbed 13%-points in world market share from the EU and another 8%-points from NAFTA

7 EU countries make up almost 80% of the installed base, with Germany, Italy, France and UK commanding more than 50%.

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Imports of passenger cars into the EU from Japan fell by almost 50% from 2006 to 2011 Imports from the US fell by more than 50% from 2008 to 2009

Exports of passenger cars from the EU show elevated volatility, possibly amplified by currency movements A shortfall in exports to the US of EUR 7bn since 2006 was more than compensated by an increase in exports to China (+15bn), Russia (+2.7bn), Switzerland (+2.6bn) and Turkey (+2.3bn). In 2006, exports to the US were more than 10 times larger than those to China; in 2011, both were almost equal.

CONCLUSION: Global car markets have undergone dramatic changes over the last 5-10 years. A healthy domestic market and somewhat flexible workforce are indispensible for profitable utilization of capacities over the cycle.

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2013 New Vehicle Registrations by Country:

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Part I: Passenger Vehicles

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Passenger Cars: Top 5

Spain and UK growing; rest flat Momentum improved Scrapping premiums, like in Spain, simply pull future demand forward; the effect usually does not last

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Passenger Cars: Top 5 (indexed)

UK first market to turn upwards Rest: bottoming out very slowly

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Passenger Cars: Top 6-10

Netherlands bouncing back after dropping below the 2008/09 bottom The rest: stabilizing

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Passenger Cars: The PIIGHs

Greece: The patient's heart beat almost stopped Ireland and Iceland were the first to bottom out Portugal the last country (apart from Greece) to recover

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Passenger Cars: Best Markets

Few markets have managed to exceed registrations compared to 2007 Eastern Europe (2) and Scandinavia (2) are well represented in this list

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Part II: Commercial Vehicles

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Commercial Vehicles: Major Countries

New commercial vehicle registrations are back to growth in all major markets except Italy Momentum is improving further

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Commercial Vehicles: Top 5 Countries (indexed)

Spain is growing, but from very depressed levels Germany and France are bottoming out Italy stopped the decline

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Commercial vehicles: Top 6-10 Markets

Netherlands are, as with passenger cars, in a depressed state Poland showing encouraging signs Austria has bottomed out Sweden and Belgium stabilizing

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Commercial Vehicles: The PIIGHs

Hungary: remarkable turnaround continues Ireland and Iceland found rock bottom early, but no growth since then Portugal : stabilization at a depressed level Greece: trending lower

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Commercial Vehicles: Eastern Europe

Slovenia much better than the rest, but might be in jeopardy if country has to apply for bailout

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Total EU Market (indexed)

Both passenger and commercial vehicle markets show growing signs of improvement

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Total EU Market (% yoy)

Total EU new passenger car registrations are still slightly below previous year level Commercial new car registrations are growing for the first time in 18 months.

CONCLUSION: Momentum in European passenger and commercial new vehicle registrations is improving. Slight growth in 2014 should be possible. However, improvements are limited to the big three markets (UK, Germany, France) while the European periphery and Eastern Europe are, at best, stabilizing at depressed levels. A continued strengthening of the Euro could dent car exports into non-Euro markets. Turmoil in emerging markets could spill over into non-Euro zone countries (Hungary) and hurt car sales.

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Any questions or feedback welcome. Alex.Gloy@LighthouseInvestmentManagement.com

Disclaimer: It should be self-evident this is for informational and educational purposes only and shall not be taken as investment advice. Nothing posted here shall constitute a solicitation, recommendation or endorsement to buy or sell any security or other financial instrument. You shouldn't be surprised that accounts managed by Lighthouse Investment Management or the author may have financial interests in any instruments mentioned in these posts. We may buy or sell at any time, might not disclose those actions and we might not necessarily disclose updated information should we discover a fault with our analysis. The author has no obligation to update any information posted here. We reserve the right to make investment decisions inconsistent with the views expressed here. We can't make any representations or warranties as to the accuracy, completeness or timeliness of the information posted. All liability for errors, omissions, misinterpretation or misuse of any information posted is excluded. +++++++++++++++++++++++++++++++++++++++ All clients have their own individual accounts held at an independent, well-known brokerage company (US) or bank (Europe). This institution executes trades, sends confirms and statements. Lighthouse Investment Management does not take custody of any client assets.

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