March 2016: new passenger vehicle registrations increased in China, Europe, India and the USA with weaker sales in Japan, Russia and Brazil. China was again the largest and fastest growing major car market in the world while Europe outperformed the US market in March. The contraction in Russia and Brazil was less severe in March than for the quarter as a whole but the outlook remains mostly negative. The Japanese market weakened again in March while stronger sales were registered in India.
Worldwide Car Sales in 2016 (Q1)
New passenger vehicle registrations in various major regions of the world monitored by the VDA were as follows during the first three months of 2016:
|Region||March 2016||% Change||Q1/2016||% Change|
Note: *USA, Brazil and Russia include light vehicles (trucks). % Change refers to same period the previous year.
China – Largest Car Market in the World
China recovered its position as the largest single-country car market in the world after sales were higher in the USA in February 2016, when the Chinese market was influenced by the date of New Year celebrations. New passenger vehicle registrations in China increased by a strong 12.4% in March 2016 to nearly 2 million vehicles.
During the first quarter of 2016, nearly 5.5 million cars were sold in China – an increase of 9.4%. The Chinese market was helped by a lowering of taxes from late last year on cars with engines smaller than 1600 cc but German luxury carmakers Mercedes-Benz, BMW and Porsche saw sales increase even faster than the market average.
Continued Growth in the European Car Market in 2016
In the European Union and EFTA, March 2016 was the 31st month of consecutive growth in new passenger vehicle registrations. In March 2016, 1,745,000 cars were sold in the EU & EFTA – an increase of 5.7% over a year ago despite Easter reducing the number of working days in March 2016 compared to 2015 when the holiday weekend was in April. In many parts of Europe, car sales reached volumes last seen before the start of the financial crisis in 2008.
During the first quarter of 2016, European car sales increased by 8.1% to nearly 4 million cars. Strong sales in Italy continued in March with the Italian market during the first quarter just replacing France as the third largest car market in Europe. Germany remained market leader – although the Easter weekend led to flat sales in Germany in contrast to second placed Britain where March is traditionally the most important month of the year for the car market.
The European car market was helped not only by growth in the larger countries but also strong growth in smaller nations. Continued low interest rates and a large backlog of replacing older cars in smaller countries affected by financial troubles in recent years continued to help the market. During the first quarter of 2016, the Netherland and Greece were the only EU countries where new passenger vehicle registrations were weaker than a year ago.
Stable Growth in the US Car Market in 2016 (Q1)
The US new car market continued to grow at a steady 3% pace during both March and the first quarter of 2016. With 1,585,400 new light vehicle registrations in March 2016, the US market was smaller than Europe but for the quarter remained just ahead. At just over 4 million light vehicles, the first quarter of 2016 was the strongest start to the year in the US since 2001.
As had been the trend for more than a year, car sales contracted by 7% in March 2016 to 667,000 cars while light trucks (and SUVs) increased by 11% to 918,000 vehicles.
Stronger Car Sales in India in 2016 (Q1)
In India, car sales were up 5.1% in March to 256,900 cars. During the first quarter of 2016, the Indian new car market comprised of only 723,100 cars (+2.4%) – just more than a third the size of the Chinese market in March alone.
Weaker Car Sales in Japan in 2016 (Q1)
The Japanese car market weakened again in March 2016 with sales down by 9.3% to 532,000 cars. During the first quarter of 2016, the Japanese car market contracted by 7.5% to 1,243,600 cars.
Continued Weakness in the Russian Car Market in 2016 (Q1)
The Russian car market continued to shrink although the contraction of 10% in March 2016 was less severe than most other months in the past year. During the first quarter, the Russian market weakened by 17% to 319,00 cars.
Brazil – Weak Car Sales in 2016
The Brazilian market contracted by a further 23,4% during March 2016. During the first quarter of 2016, light vehicle sales in Brazil weakened by 28% to 465,500 cars. Economic weakness and political uncertainty in Brazil are unlikely to help the market in coming months.