The European market could end 2020 at -30%
- In the first half of 2020, the European market (passenger cars and light utility vehicles) fell by 39%. In June 2020, only the French market was positive, thanks to the ecological bonus. The other European markets are in decline as no governmental subsidies supported the demand, apart from a reduction in VAT in Germany.
- For the second half of 2020, various announcements have been made by some countries (Great Britain, Spain) to support market demand, however, so far, nothing concrete has been decided. Are public supports going to be put in place in Europe to support demand in 2020? If so, when will they be implemented? In July, August, no decision will be made due to the holidays. Will European markets benefit from the European recovery plan? If decisions are taken in September, the implementation and the induced effect can only materialize in the last quarter of 2020.
- Since the start of the COVID-19 crisis, Inovev has established three very short-term scenarios (2020), which are updated based on the latest known elements and which may influence demand:
• A “High” scenario: This most optimistic scenario is based mainly on the implementation of measures supporting demand in all European markets and which will take effect in the last quarter of 2020. Result: a 3rd quarter at -17.5 % + a 4th quarter at -2.5%, meaning a 2nd half at -10% and therefore a 2020 year at -25% (taking into account the drop of 39% in the 1st half).
• A "Ref" scenario: This reference scenario for Inovev is based on the partial implementation of support in Europe (in certain countries only) and a less than expected severe effect of the crisis on the economy. Result: a 2nd semester at -25%, and therefore a 2020 year at -30%.
• A "Low" scenario: This most pessimistic scenario arises in the event that no support decision is made in major markets, or in the event of a second wave of COVID-19. The last half of 2020 would be in line with the first half of 2020 (-39%). Result: A 2nd semester at -37%, and therefore a 2020 year at -35%.
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