FOR brokers looking for guidance as to how the car market might bounce back from the coronavirus lockdown, then China might provide some clues.
A report in the Financial Times (06 May 2020) said that the market had returned quickly, with May sales expected to be at 2019 levels, according to Volkswagen boss Jurgen Stackman.
In early April all 2,000 Volkswagen brand dealerships were once open again, with showroom traffic during the last weekend of March comparable to the same period last year, said a company report.
Volkswagen Group China CEO Stephan Wöllenstein added:
“Our dealerships are seeing customers on the showroom floors once again. There are growing signs of recovery, with a good chance that the Chinese car market could reach last year’s level in early summer.”
Nevertheless, there are several factors unique to China, including the pent up demand for new cars by first-time buyers, said the FT, unlike the more mature European market.
A mood reflected by BMW, which said it expected conditions to be ‘constrained’ for some time.
Chairman Oliver Zipse said:
“Quite clearly, the situation remains serious and market forecasts are subject to constraints under these circumstances. We are gradually ramping up our production again according to demand in each market. However, we are monitoring developments extremely closely to be able to respond with maximum flexibility.”
The SMMT has downgraded its new car market forecast for 2020 to just 1.68 million registrations following April’s collapse in registrations. The SMMT said:
“This would represent the worst year of new car sales since 1992 and below the levels recorded during the 2008 financial crisis.”
Ralph Morton is the leading journalist in the leasing broker sector and editor of Broker News, the website which provides information and news for BVRLA-registered leasing brokers. He also writes extensively on the fleet and leasing market in both the UK and Europe.
