The UK's car market hit an all-time high in 2015 and new figures suggest the rest of the continent is on the up too. Good news for most manufacturers, except for one notable (and probably unsurprising) exception. Volkswagen has lost further market share in Europe, suggesting its emissions scandal is making consumers cautious.
Volkswagen accounted for 22.5% of new cars sold in Europe in December 2015, compared with 25% in December 2014. So it's still the biggest car seller but that's a significant drop, especially when you consider its rivals' trajectory (though looking at the whole year VW's share only fell by 1%). According to the European Automobile Manufacturers Association (ACEA), industry-wide registrations rose 9.2% to a six-year high of 14.2m vehicles – compared to the German car maker’s 6.2%. It was a particularly buoyant last month of the year too as registrations in the EU rose 16.6% in December (the highest gain in 28 months).
Europe’s biggest car-maker has been losing ground to the likes of Fiat Chrysler and luxury manufacturers BMW and Daimler since its scandal unfolded. European sales last year at Volkswagen’s namesake brand rose 6.5%, while the premium Audi division posted a 5.7% increase, and has dropped to third in global luxury-car deliveries behind BMW and Daimler’s Mercedes-Benz. Meanwhile, mass market manufacturers including Ford and Renault posted gains of over 20%.
The European car market’s strong December figures reflected a resurgence in consumer confidence as well as low fuel prices, but it seems customers may be hesitating with a ‘wait and see’ attitude in regards to Volkswagen specifically.
It’s already clear that anticipation of further emissions revelations is causing jumpiness among investors. Shares in Renault plunged around 22% yesterday following news that several of its sites had been raided by police, reportedly relating to the engine control units. No word yet on if anything untoward has been discovered, but just the whisperings have been enough to put a financial dent in the auto firm – some €5bn was wiped from Renault's market cap.
So suspicion is still rife and the trade body itself urged caution over the positive outlook for the European car market as the result is only now surpassing levels registered in 2010. You’d think in such delicate times VW would be making considerable efforts to rebuild trust to halt its declining market share.
Over in the US, the California Air Resources Board and United States’ Environmental Protection Agency have just rejected VW’s proposed fixes for the cars affected by its emissions testing affair, for containing gaps and lacking 'sufficient detail'. And apparently the company is already bristling at what the US probe into its emissions scandal will entail. Connecticut Attorney General George Jepsen said VW was ‘resisting’ attempts to uncover how the firm was able to install its ‘defeat-devices’ on some 600,000 cars in the US. MT’s sure that will do wonders for winning back consumer trust.