European 2023 car sales set to rebound from 2022 low – Bloomberg Intelligence

European new-car sales rose 17 per cent in May – a 10th straight month of growth – thanks to a 13.3 per cent year-earlier decline and pent-up demand, finds a new report from Bloomberg Intelligence (BI). This is driven by easy year-earlier comparisons, fewer supply-chain hurdles and pent-up demand.

Gillian Davis, BI Industry Analyst (Autos), comments: “European new-car sales rose 17 per cent in May, and that figure also holds the year-to-date gain steady at 17.3 per cent, keeping expansion on track for 5 per cent in 2023 given far tougher comparisons in H2. Supply-chain constraints have abated, though tightening consumer budgets amid inflation and rising interest rates are a threat to the auto-sales recovery.”

Car sales could grow 5 per cent despite uncertain 2H

The challenging economic backdrop might not translate into lower 2023 car sales, given 2022’s volume matched previous recession lows. Easy prior-year comparisons, pent-up demand and the rebuilding of inventory channels will support H1 registrations, as highlighted by both BMW and Volkswagen. VW pointed to robust order backlogs and maintains an optimistic double-digit volume growth outlook despite an uncertain H2. Stellantis cites S&P Global’s forecasts for volume increases of over 5 per cent in Europe, though high interest rates and relatively weak consumer confidence likely prevents the industry from achieving double-digit growth in 2023.

ACEA has forecast 2023 EU new car sales of about 9.8 million, up 6 per cent from 2022. This would still be 25 per cent below 2019’s pre-pandemic levels.

VW sustains BEV lead over Tesla; share still below 2022

Volkswagen may have extended its lead over Tesla in European BEV sales in May after regaining pole position in the four months to April. Price cuts drove Tesla’s sales surge through March, but this trend is unlikely to continue into Q2, with BI’s calculations pointing to 25,000 registrations in May. Stellantis was steady in third place despite a weak start to 2023 amid mounting competition. Though Tesla’s Model Y was Europe’s best-selling BEV in the four months to April, legacy automakers VW and Stellantis plan to launch six new models in the rest of the year.

VW had five of the top-selling BEVs in the year to April 15. Tesla, Stellantis and Renault had two each, while MG, Volvo, Hyundai and Kia had one apiece.

BEV mix on upward trend, driven by UK, Germany

Environmentally conscious Europeans have kept BEVs on an upward trajectory, with such models comprising 12.7 per cent of the sales mix in April (13 per cent year to April). That’s below 2022’s 13.8 per cent and December’s record 25 per cent, but those figures were skewed by the bringing forward of registrations to meet EU CO2 targets and avoid subsidy cuts in Germany. In absolute terms, BEVs are gaining ground each year, supported by strong sales mixes in the UK (16.9 per cent) and Germany (17.3 per cent) in May.