The ACEA predicts the new car market in the EU will begin to recover in 2021
The ACEA predicts the new car market in the EU will begin to recover in 2021

After a year that saw the sharpest drop ever in EU car sales due to the COVID-19 pandemic, the European Automobile Manufacturers’ Association (ACEA) forecasts that 2021 will mark a first step on the path to recovery, with sales rising by about 10% compared to 2020.

The fallout of COVID is expected to persist into the first quarter of 2021, but the car market should pick up in the second half of the year as vaccination programmes progress.

“Now more than ever it is crucial that we work hand in hand with EU policy makers to strengthen the competitiveness of Europe’s auto industry on the global stage,” stated ACEA’s new President, Oliver Zipse, who is also CEO of BMW.

“Thanks to the global business model of European auto manufacturers and international demand for EU-made vehicles, production facilities in Europe were able to benefit from more swiftly-recovering markets last year, notably those in Asia,” noted Mr Zipse. “Nevertheless, the sustainable economic recovery of the European Union and local demand is vital for our return to pre-crisis strength.”

Boosted by increasing industry investments and national support measures to stimulate demand during the COVID crisis, the market share of full battery electric vehicles and plug-in hybrids grew strongly in 2020, with an EU-wide market share of 10.5 %, up from just 3% in 2019.

“With the right policy support, including a massive ramp-up of charging and refuelling infrastructure for alternative fuels across all EU member states, this positive trend can continue,” Zipse stressed. “Despite the economic pressures caused by the pandemic, our industry remains fully committed to its ongoing transformation to carbon neutrality.”

Decarbonisation, together with digitalisation, is also changing the nature of technologies that go into vehicles. With this in mind, ACEA is calling for a realistic European strategy on access to the supplies and raw materials that are necessary for state-of-the-art vehicles. Indeed, recent microchip shortages illustrate how disruptive a sudden interruption of crucial supplies can be to the industry, with its complex supply chains and a just-in-time business model that already is under a pressure because of Brexit.

Zipse: “Our sector is working hard to recover and rise to the challenges ahead. Because an EU auto industry that is strong – both at home and globally – will not only contribute to strengthening Europe’s economy, but also to reaching its climate ambitions.”