The pessimism has taken over the main car factory of Europe. For the third year in a row, Germany has dropped the production of vehicles, but this time with the lowest number since 1997, to 4.7 million units, according to statistics released yesterday by the VDA, the employers ‘ association of German manufacturers. The contraction is, compared to the previous year, 9%, and is explained basically by the situation outside its borders: exports fell 13% while the domestic market grew 5%.
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sales of cars diesel drop 26% in the black year for the sector So it can affect Spain stop Germany
The great fear is that the collapse will spread to the rest of the sector, and countries that supply to the plants German. Giants of the likes of Robert Bosch, Brose and Continental have assumed that scenario and are implementing plans to reduce templates and capacity manufacturing plant. The next step are the so-called TIER-2, which are supplied to the groups that collaborate directly with the brands.
The trade war the U.s. is waging with China and Europe and the effects of Brexit are making a dent in the country where they are manufactured one out of every three cars in the European Union. The research department of Deutsche Bank warned in a recent report of the effects of the tariffs with which they could load the vehicles and components of German cars that are exported to the united STATES. Quantify the possible impact on up to 5,000 million euros to the industry. The solution, say its analysts, would be to feed the demand american from local factories and aggravate the situation, which is read as increased pressure for the year that begins.
But the external environment is not the only one that is leaving played at the industry. The fall in production in 2019 is also influenced by the end of the cycle of some of the main models such as German, which means less demand —awaiting the arrival of the new versions— and production. And Deutsche Bank also warns that some brands are making a major effort to adapt their plants to assembly of electric vehicles.
Fall in the Uk
The most obvious example is Volkswagen, the world leader in the sector, which has concentrated the first generation of their vehicles designed to be only electrical in four factories located in Germany. The investments are milmillonarias and, in contrast, market expectations are uncertain, as much as the group has advanced two years your goal of one million electric cars sold, which is expected to achieve in 2023.
In any case, the VDA already warned in December that Germany would be very wrong to stop the fall in sales world of 2019, which is estimated to be 5%. The direct consequence will be an increase in unemployment in the sector. “The use of capacity has fallen, temporary contracts are not being renewed and the instrument of short-term employment is being used again,” said Bernhard Mattes, president of the VDA.
The fall of sales of cars in the Uk in 2019, the third year in a row, is an example of the evil that weighs on the German market. Enrolled 2.3 million vehicles in the second largest european market in a year that the employer SMMT called “turbulent” by the uncertainty surrounding the Brexit, but also by the suspicion that, as in other countries —Spain included— generate the vehicles powered by diesel engines. On the whole, the contraction was 2.4% in the whole of the year, reaching the worst results since 2013. Spain, who presented their data last week, is also in its lowest figures since 2012 after suffering a drop of 4.9%.
No final figures yet, the EU market is poised to close the year with enrollments flat. Until November the first nine months showed a slight fall of 0.3%, although this percentage may increase because sales in the last months of the year are growing. In the whole of the European Union, the evolution has been positive in the last three months, according to data from ACEA, the employers are european.
