May Car Sales Provide Glimmer of Hope for Europe’s Auto Industry

(Bloomberg) -- Europe’s car industry showed tentative signs of a recovery in May with some French and Spanish buyers braving visits to reopened showrooms.

New car registrations fell 50% in France year-on-year, CCFA, the nation’s automotive-industry group, said in a statement on Monday. The drop was an improvement over April’s 89% plunge. Spain also showed a slight comeback.

Renault SA and Peugeot owner PSA Group have said that most of the first customers to return to dealerships were those who had ordered vehicles but were been unable to take delivery due to the lockdown. “I’ve seen stronger rebounds,” Renault Chairman Jean-Dominique Senard said Sunday in a French television interview, adding that any reversal of the sales slump has been tepid so far.

European governments will be keenly watching car-sales data for evidence that relaxing lockdown rules and allowing factories to reopen will help kickstart the automotive industry. Companies from Ford Motor Co. to Volkswagen AG had to shutter plants and showrooms for weeks during the height of the pandemic, yet are now starting to manufacture small numbers of vehicles.

May Car Sales Provide Glimmer of Hope for Europe’s Auto Industry

Dealerships are up against frail investor confidence, with consumers on alert for any further outbreaks that could cause lockdowns to be reimposed.

Spanish car registrations fell 73% in May, according to data published Monday. That’s also an improvement from the previous month, when sales crashed 96.5%.

Sweden Unclear

The picture from Sweden, where the state allowed dealerships to stay open, was less clear. New registrations dropped by 50%, which wasn’t far off April’s decline when accounting for calendar effects, according to industry group BIL Sweden.

“The effects of the coronavirus outbreak continue to have a strong negative impact on the automotive market,” BIL Sweden Chief Executive Officer Mattias Bergman said in a release.

Figures from Italy are expected later Monday, with Norway’s tally arriving as early as tomorrow. U.K. registrations will be published on Thursday.

The French government unveiled a stimulus package for the auto industry last week that took effect Monday. It provides incentives for the purchase of electric vehicles as well as cash for clunkers. The package includes aid for expanding charging stations and support for small and medium-sized parts suppliers.

©2020 Bloomberg L.P.

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