Sales of midsized luxury cars in Europe continue their downward trend in the first quarter of 2019, with deliveries down 3% to just over 160.000 units. And if it hadn’t been for the thunderous arrival of the Tesla Model 3, the segment would have been down by 14%. In March alone, Tesla delivered more Model 3’s than any midsized namplate except for the Mercedes-Benz C-Class, and that also includes all mainstream midsized models like the VW Passat. However, this is not reflective of the long-term potential of the Model 3, as these figures reflect deliveries of cars ordered over the past few years. Tesla registrations will continue to fluctuate greatly over the course of the year as customer deliveries are dependent on the arrival of the ships that deliver the cars to Europe. The American EV brand may make some headlines as it may seem to outperform its European rivals, and the huge amount of pre-ordered vehicles is by all means an impressive feat, but in our analysis of the registration figures, we’ll always try to compare apples to apples. For the first quarter, the C-Class is still in command despite a 6% drop in sales, as its closest rival Audi A4 loses almost a quarter of its volume, as well as 4,6 percentage points of share, as some gasoline models still haven’t been available due to the WLTP standards introduced last September. Taht allows the BMW 3-series to close the gap to the #2 spot, despite seeing its sales slide 8% as the new generation is just arriving in showrooms. With Audi’s availability issues apparently solved (sales were down “just” 7,5% in March), an upcoming facelift for the A4 and BMW’s new 3-Series picking up steam, the battle on the podium will be intense for the rest of the year, especially with the wild card Model 3 that could crash the party as well.
EV and PHEV sales in Europe have set another record in 2018 with a 22% increase to nearly 345.000 sales of plug-in vehicles, of which close to 190.000 full electric cars and almost 155.000 plug-in hybrid cars. Sales of the former surged 44% while PHEV sales were virtually stable at +3,3%. 2018 therefore marks the first year that battery electric cars outsold PHEVs. Plug-in vehicles accounted for 2,2% of the European car market, up from 1,8% in 2017 and 1,4% in 2016. The rate of growth for EVs in Europe still lags that of worldwide EV sales, which grew by 73% in 2018.
After ending on a down note in the last quarter of 2018, European car sales continue their negative trend in January 2019. Registrations of new passenger cars were down 3,9% to nearly 1,23 million sales, still above 2017 levels. Most of the decline can still be attributed to the after effects of the introduction of new fuel efficiency and emissions testing standard called WLTP (Worldwide harmonized Light vehicle Test Procedure) in September. Demand for new cars fell across almost the entire European Union, including the five major markets. Spain and Italy posted the strongest declines (down 8% and 7,5% respectively), while the United Kingdom was surprisingly stable at ‐1,6%. Germany (‐1,4%) and France (‐1,1%) also did better than average. Best performing market was Lithuania (+49%), followed by Romania (+18,8%) and Hungary (+9,2%). The only other markets to improve on 2018 were Portugal (+8,3%), Denmark (+7%), Greece (+3,7%) and Latvia (+0,7%). The biggest declines were seen in Iceland (-47,9% to just 846 registrations), Netherlands (-18,8%) and Czech Republic (-17%).
Sales of premium large SUVs in Europe declined in 2018 for the second year in a row, after three consecutive years of explosive growth during which 100.000 annual sales were added. In the last two years, the segment has lost 33.000 sales again as volume is back to 255.000 sales, down 6% on 2017. The entire top-5 is down for the year and only 4 out of the 18 remaining players in this class improve their volume this year. The BMW X5 holds on to the segment lead by the skin of its teeth, less than 250 sales ahead of the Volvo XC90. For the X5, this is its fifth consecutive year on top of the ranking, and for the XC90 it would have been its first win ever, if only it could have found those 250 extra buyers. The X5 is being replaced in 2019, which means it’s likely to storm back ahead again, and this was the Volvo’s only chance for a while. The Mercedes-Benz GLE in third place will also be renewed in 2019 and may threaten the X5 and XC90 to climb either one or two spots once it reaches full availability. The last time the GLE (or M-Class) finished on top of its class was in 2013. The Range Rover Sport climbs one spot to #4 with sales down just 5% which allows it to move past the Audi Q7, down to places into 5th as the WLTP affected sales of some of its versions, and the introduction of the Q8 didn’t help either. Its sibling model Volkswagen Touareg did better with an increase of 15% thanks to the new, third generation. Still, sales are far below the peak of the namplate’s first generation in 2004 and 2005 when it sold over 40.000 copies in Europe.
Sales of midsized premium SUVs in Europe continue to grow in 2018, but at a lower rate than before. After four consecutive years of double digit growth, of which the last three years showed at least 20% growth, the segment was up “only” 5% in 2018. This still means that for the first time ever, over half a million luxury midsized crossovers were sold in Europe. And after claiming the segment lead last year, the Mercedes-Benz GLC consolidates its lead with a 13% gain to over 125.000 sales, almost one in every four sales in this segment. Please note that these figures include sales of the GLC Coupe, but even without those the GLC would easily top the ranking. Just imagine the sales volume (and turnover) Mercedes-Benz has missed by completely failing with the design of its predecessor GLK, which peaked at just 33.000 sales and 15% of the segment in 2012. The Volvo XC60 is down 19% in the first full year of sales for the new generation, and this is mostly due to the strong finish of the previous generation, which even continued to be sold alongside the new model in its home market Sweden. Despite sales back to its 2016 level but its market share thawed to the lowest in at least 7 years, the XC60 still holds on to its #2 spot ahead of the Audi Q5, which sees stable sales in 2018, as it also did in 2017. The Q5 has been around 70.000 annual sales for three years now, even during the changeover to the next generation and last year’s introduction of the WLTP fuel efficiency testing procedures, which meant some versions of the Q5 (and many other models) could no longer be sold after September 1st, 2018.
After discussing overall worldwide car sales in 2018, let’s zoom in on the most booming segment of all: that of EVs. Global sales of battery electric cars increased 73% in 2018 to 1.26 million units, after already jumping 86% the year before. That means worldwide sales of EVs jumped more than threefold in just two years time. Of course these are all new records as the market for electric cars is still in its infancy and has plenty of room to grow in coming years. The major factors pushing up EV sales in 2018 were demand from China (partially thanks to government incentives), the launch of the Tesla Model 3 and the diesel crisis in Europe which helped consumers become aware of the available alternative powertrain technologies and the benefits of driving electric. China was by far the largest market for electric cars, with 61% of worldwide sales registered in this market, followed by the USA with 16.6% and then Norway with 3.6%, which is also the country with – by far – the highest penetration of EVs worldwide. At 31.2%, battery electric cars represented almost 1 in every 3 sales in Norway. Including plug-in hybrids, that figure would even increase to nearly 1 in every 2 sales.
In 2018, worldwide sales of passenger cars and light commercial vehicles decreased for the first time since 2009, as carmakers sold 0.5% fewer vehicles, according to JATO Dynamics figures, based on their data of 54 top markets. Slightly over 400.000 fewer vehicle sales compared to 2017 make for a new total of 86.01 million global car sales. Passenger car and pick up sales were down 0.6% to 81.84 million and LCV sales were up 2.5 to 4.17 million vehicles. Of the major markets double digit growth was recorded by Thailand (+20%), Brazil (+14%) and Russia (+13%), the latter now a larger market than South Korea (+1,4%), while sales declined by double digits in Turkey (-35%) and Argentina (-10%) as these two countries battled economic downturns. But small declines in Europe, United States, and most significantly China had a great impact on global car sales. India on the other hand set a fourth consecutive annual sales record and finally surpassed Germany to become the world’s fourth largest car market. The fastest growing segment worldwide was that of EVs, which increased by more than 73% to over 1.2 million sales.
After two years of growth, sales of limousines in Europe are back down again, by 6% to nearly 43.500 sales, or 0,3% of the overall market. The dominant segment leader Mercedes-Benz S-Class rebounds after three straight years of lost share to return to above 33% share with over 14.000 sales. This is still a long way from the nearly 43% share the model held in 2014 and 2015 but nonetheless a strong performance between rivals that are newer and fresher in a segment where innovation and product excellence are key. The recent updates of the S-Class have helped as the interior is now up-to-date again, but the changes in exterior design have been limited to prevent owners of the pre-facelift version from feeling like they’re being driven in an “ old” car. One sidenote we always need to make here is that S-Class sales include the Coupe and Convertible versions, which the others don’t offer for their limousines.
The midsized premium car segment in Europe shrinks for the second consecutive year in 2019, and does so by 16% to fewer than 600.000 sales or 3,8% of the overall market. That is a comparable trend to the non-luxury midsized segment, which is down 17% for the year. All top-5 players lose sales volume by 15% or more, with just the segment leader doing less terrible than the average of the class. That means the Mercedes-Benz C-Class consolidates its top spot and now has a 25,9% share, while the Audi A4 falls below 20% share. The A4 was hit especially hard in the last four months of the year, after the WLTP fuel efficiency testing standards kicked in and the brand had to stop sales of a number of popular versions of the A4, among others. Until August, A4 sales were stable on 2017, but from September onwards, the model’s average monthly sales dropped to just 30% of the average in the eight months before. In those last four months, the A4 lost almost 30.000 sales on the year before, while the C-Class lost 5.000 sales in the same period and the BMW 3-series lost 7.000 sales. With a new 3-Series in showrooms this year and Audi’s continued struggles to get the A4 tested under the new rules, there’s a significant chance of a different podium in 2019.
The large SUV segment is one of the smallest in Europe with fewer than 43.000 sales in 2018, down 20% on the year before. Compare that to the US where over 2 million of these vehicles were sold last year, up 3,4%.The entire top-3 loses share and the segment best seller barely managed to sell over 10.000 units last year. Unlike the midsized crossover segment, where some models are also available as 7-seaters, there are not a lot of new entrants to this segment in Europe, but brands are actually withdrawing their slow selling models, like Nissan which no longer sells the Murano and Pathfinder and Mazda which never really sold the CX-9 in significant quantities, as opposed to the US. The latest newcomer is the Ford Edge in 2016, but after storming to the top of the ranking in its first full year of sales, we have a change of leadership for the fourth consecutive year, as the Kia Sorento reclaims the top spot that the Ford Edge stole from the Hyundai Santa Fe just one year before.