LIGHT AT THE END OF THE TUNNEL
Even the first months of 2015 confirm the positive trend recorded by the automobile market at the end of last year. The signs for a further growth in registrations are all there, along with the doubts about the strength of the economic recovery
When analyzing the trend of the car market, just the figures relating to the previous month’s new car registrations could foster overly positive or excessively negative comments. In essence, the free fall that has characterized the market in the last few years has been positively reversed, and the trend in car sales has been consistently improving at national level for quite a few months now. At the same time though, a more cautious approach is necessary, especially considering the different facets that make up these positive signs, as well as the market dynamics that in February 2015, after the first double digit growth (+13,2%) since March 2010, prompted analysts to more prudent opinions. What should be remembered is that during the last 4 years, the market has progressively shrunk to levels similar to the early 80s, and therefore, notwithstanding the current positive signs, figures are still too similar to what they were back then.
The first two positive months
The last figures available, provided by the Ministry of Transport and Infrastructures, show a growth of 12,3% compared to the January-February period in 2014, with new car registrations reaching 266.555 units. A rather positive signal supported by a rise in the Consumer Confidence Index (benchmarked at 2005=100) that went from 104,4 to 110,9 in February. Furthermore, an additional positive element is represented by the number of vehicles orders recorded in the first two months of 2015, reaching 277.000 units, a 13% increase compared to the same period in 2014. So it seems that there is a loosening of the attitude of extreme caution on the part of consumers that has contributed, along with the economic and employment crisis as well as lingering stagnation of the economy, to a strong decrease in consumption, prompting Italians to postpone as much as possible the replacement of a durable product such as a car. Very significant in this regard is the data supplied from Anfia’s Studies and Statistics center that, during the 1998-2002 period registered 11.8 million new car registrations of which, at the end of 2013, 84% was still running. Cars that have now largely exceeded 10 years of service and, therefore, need replacing.
The strength of eco-friendly vehicles
Increasingly popular among new car owners in Italy are vehicles powered by alternative fuels and according to preliminary data processed by ANFIA, 18,700 new registrations were recorded in February alone, an increase of 17.7% over the same month of 2014 and a share of 13.9% of the total sales figures. In the first two months of 2015, so-called "eco-friendly" vehicles recorded sales in excess of 39,500 units (+ 19%), reaching a market share of 14.8%, 0.9 points higher than a year ago. The effects on the car market, thanks to the key role played by CNG and LPG powered vehicles, is unmatched by other countries in the European Union and allows Italy to boast an average CO2 emission among the lowest on the continent. Preliminary data from Anfia show that, in the first two months of 2015, the average value of CO2 emissions dropped to 115.9 g / km from 116.4 recorded in January 2015. In this context, the market also records a marginal yet consistent growth for electric and hybrid cars in the first two months of 2015, increased by 154% and 25% respectively.
Few luxuries, lots of SUVs
Whether it is the additional road tax on models with power higher than 185 kW, or more likely the economic crisis that leads to caution even those with no money problems, the fact is that in the first two months of 2015 top range cars (luxury sedans, sports cars, big SUVs, big MPVs) showed a negative trend (- 6.6%). This decrease is symptomatic, considering the losses already recorded in 2014 (-0.5%) and especially in 2013 (-23%) though largely positive for all other segments. Analyzing the internal flows of the market, or simply just taking a looking at what is happening, what can be noticed is a great success for small or medium sized SUVs, that have gone, within a year, from a 9% share of the market to 23.4% in the first two months of 2015, which means that a car out of four new registrations belongs to this segment. A and B segment cars of course still account for almost half the number of new registrations, although the overall share has gone from 52% in 2008 and as much as 58% in 2009 (thanks to the introduction of incentive schemes) to 47% in 2014, only to fall to 46.5% in the first two months of 2015.
The zero mileage import
When we hear of vehicle registrations, we automatically think of sales, as if the two words were synonymous. In reality this is not so and the import of zero mileage vehicles on the total number of registrations is there to prove it. The final figures still refer to 2014, but there is no doubt that the tendency on the part of dealers to sell demo cars or other vehicles that will be sold as “zero mileage” is on the rise. Last year, in fact, 131.483 such vehicles were sold, an increase of 5.8% over 2013, with a market share going from 9.4% to 9.5%. In practical terms, this option is still a second choice, yet it still makes up a large portion of the total number of the 859.169 registrations. Not to forget, however, that there are more motorists who, in most cases, will buy a "zero mileage” or a "Company car" as a second choice. So many saving opportunities for those who want to change the car and, more generally, an important clue of how the automotive market needs corrective actions to ensure, among other things, greater margins for operators.
The thrust of rentals
The good results of the first months of 2015 are undoubtedly due in part, if not primarily, to the thrust of the rental sector, with over 36,600 new registrations in February alone, a growth of 45% over the same month of 2014. According to Aniasa - the National Association of Rental Industry and Automotive Services - in recent years such important figures were recorded during the months of March and June, and the growing interest in Expo 2015, as well as the good signals coming from the Italian tour operators market, justify the growth of new registrations. As far as long-term rental companies on the other hand, it’s a matter of replacing vehicles, especially by those companies that, after having extended the renewal cycle from 36 to 48 months, are now driven by the a growing climate of confidence.
Cautious optimism in Geneva
Among the best European automobile exhibitions, the Geneva Motor Show – from March 5 to 15 - was considered, once again, as the "lounge" of the car industry without the frills of Detroit and Frankfurt, but with more than 130 World and European premieres with which manufacturers intend to recapture the demand. The many visitors, at least 700,000 according to estimates, will not have missed the lack of proportion between the many supercars exhibited as dream objects and the relatively few everyday cars on display. Perhaps a signal of the manufacturer’s prudent attitude, waiting to have some more certainties on Europe’s economic recovery before firing their best shots.