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European Car Sales Drop To 20-Year Low, Germany Clobbered

Tyler Durden's picture





 

When the S&P, always so conveniently ahead of the curve, yesterday revised its forecast for Europe from growth in the second half of 2013 to 2014 one couldn't help but golf clap, as well as wonder if they finally started looking at the fundamental depressionary reality on the ground instead of the rating agency's infamous "models." A depressionary reality confirmed by the latest car sales number for May which just hit a fresh 20 year low.

From AP:

European car sales hit their lowest level for the month of May in 20 years as the region's recession dragged on, the European automakers' association said Tuesday.

They meant depression instead of recession, but it's an honest mistake.

Passenger car sale demand for May dropped by 5.9 percent on the same month last year in the 27-country European Union to 1.042 million units, the lowest level since May 1993, when sales dropped below 1 million, according to new figures released by ACEA. For the first five months of the year, sales dropped 6.8 percent to 5.07 million.

 

The economy of the 17 European Union countries that use the euro shrank by 0.2 percent in the first quarter of this year — the sixth such decline in a row — and unemployment is at 12.2 percent. Meanwhile, the wider 27-country EU has also seen its economy slide into recession, shrinking 0.1 percent in the first three months of 2013.

 

Europe's recession has hit carmakers especially hard, as consumers put off purchases of high-ticket price items like cars under rising unemployment. Carmakers have announced factory closures and put off new car launches in a bid for survival and to return their struggling European operations to profitability.

And while the picture in the periphery has been bleak for a long, long time, the collapse in German car sales is certainly a novel development:

Even in Germany, Europe's strongest economy, car sales dropped to a worrying 9.9 percent in May. In Europe's other leading car markets, the picture was just as bad: Italy was down 8 percent, France saw a 10.4 percent drop, and Spain was off by 2.6 percent. Britain was the only major car market to post growth, up 11 percent.

It may be time for France to further bailout its semi-nationalized car makers. Just to make them more efficient and what not:

Mass market carmakers — PSA Peugeot-Citroen, Renault, Ford, General Motors and Fiat — all suffered double-digit declines in May. Germany's Volkswagen saw its sales drop at a slightly lower rate — a 2.8 percent drop in brand sales and 5.9 percent decline for the group. Sales of Mercedes brand were up 2.8 percent, while BMW brand sales declined 8.1 percent.

So aside from this, the record high unemployment, the record high non-performing loans, and the constant threat of bank deposit confiscation virtually everywhere now courtesy of Diesel-BOOM, Europe is doing just great: after all how else could one explain the jump in German investor confidence? Wait, Japan's carry trade? What's that...

 


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Tue, 06/18/2013 - 07:58 | Link to Comment Debugas
Debugas's picture

GM is selling new cars in China for under $10000

prices in US and in EU are still very overbloated

 

I bought my first car for 2000 euros and still use it

Tue, 06/18/2013 - 08:04 | Link to Comment jbvtme
jbvtme's picture

that cute model could use some obama care

Tue, 06/18/2013 - 08:14 | Link to Comment SpanishGoop
SpanishGoop's picture

Obama "Phone", "Care", "Car".

Everybody an iPhone, an iBandage and a Chevy Volt.

 

Tue, 06/18/2013 - 08:42 | Link to Comment WayBehind
WayBehind's picture

If you dont have job or money to go shopping, you dont need a car. Very simple ...

Tue, 06/18/2013 - 09:42 | Link to Comment Sudden Debt
Sudden Debt's picture

Indeed and it says so in the numbers.

1993, the year when there was mostly 1 person working in the family and mommy stayed home takeing care of the kids.

So you could say we're down 50% or more in carsales.

And also a look to 1993 and now... a lot of kids where less fucked up than then now. ADHD and other fucked up stuff, where does it all come from. But that's another topic :)

Tue, 06/18/2013 - 10:30 | Link to Comment Panafrican Funk...
Panafrican Funktron Robot's picture

Auto sales in general appear to be peaking (even in China) and will be a drag on future global GDP growth.  Enter hedonic adjustments.  

Tue, 06/18/2013 - 12:20 | Link to Comment macholatte
macholatte's picture

 

A depressionary reality confirmed

 

That's what the doctor said ....... it was golf clap.

 

Tue, 06/18/2013 - 08:48 | Link to Comment SpanishGoop
SpanishGoop's picture

How many pairs of shoes can you get for a second hand Chevy Volt, two ?

 

Tue, 06/18/2013 - 08:56 | Link to Comment knukles
knukles's picture

Whyz that look like the pictures were from Deetriot?
Hmmmm

Dystopian this,
Dystopian that,
With a lack of morals,
And a lack of tact

 

Tue, 06/18/2013 - 09:15 | Link to Comment FeralSerf
FeralSerf's picture

Obama phones are used by the system (NSA) to keep track of the homeless or otherwise difficult to count sheep. They don't always work as intended though.

Tue, 06/18/2013 - 08:32 | Link to Comment f16hoser
f16hoser's picture

He's Gay.

Tue, 06/18/2013 - 11:18 | Link to Comment A Nanny Moose
A Nanny Moose's picture

The car, or the girl?

Tue, 06/18/2013 - 08:11 | Link to Comment NoWayJose
NoWayJose's picture

But every car sold in the US and the EU today has to have special engine crap added for air quality, all manner of expensive safety features, etc, etc. the much less expensive GM car in China does not need these things. The question for tomorrow is 'do we need these things in a competitive global economy?'

Tue, 06/18/2013 - 08:17 | Link to Comment yrbmegr
yrbmegr's picture

And, in China, they are blessed with air you can cut with a knife, and water that tastes like pork.

Tue, 06/18/2013 - 09:29 | Link to Comment ninja247
ninja247's picture

Auto emissions has nothing to do with the pollution in China. It's all coal related.

Tue, 06/18/2013 - 10:25 | Link to Comment The Proletariat
The Proletariat's picture

BTFD

Tue, 06/18/2013 - 11:06 | Link to Comment PrintemDano
PrintemDano's picture

Yum, pork......

Tue, 06/18/2013 - 08:24 | Link to Comment Debugas
Debugas's picture

and you forgot compulsory insurance which in many cases costs more than the car itself

Tue, 06/18/2013 - 08:48 | Link to Comment NoDebt
NoDebt's picture

97 dollar oil doesnt help either.

Tue, 06/18/2013 - 09:50 | Link to Comment CheapBastard
CheapBastard's picture

"The car companies didn't build that."

Tue, 06/18/2013 - 12:24 | Link to Comment Midasking
Midasking's picture

Not sure why they don't do another cash for clunkers program but just world wide.  Actually you could do it for everything like Tv's, socks, shoes... problem solved.. next? http://tinyurl.com/mem7o7x


Tue, 06/18/2013 - 07:57 | Link to Comment BeetleBailey
BeetleBailey's picture

Germany IS the Euro...and (right now) it's "strong"........

Shorting opportunities.......anyone?

Tue, 06/18/2013 - 07:58 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

'96 Buick Skylark ftw!

Wed, 06/19/2013 - 01:30 | Link to Comment MisterMousePotato
MisterMousePotato's picture

1997 Lincoln Town Car. Best automobile ever made by Detroit. Detroit? Wait, what the fuck am I saying?!?

Tue, 06/18/2013 - 08:04 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

May I humbly suggest that a two-fer-one sale might help those sluggish sales numbers?

<I will gladly pay you in 2028 for two Mercedes Benz convertibles today.>

Tue, 06/18/2013 - 08:25 | Link to Comment Dugald
Dugald's picture

Not having to recall umpteen thousand cars would be a big plus........

 

Tue, 06/18/2013 - 08:29 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Well, the insurance companies would certainly like that.  Fuck the paper-pushers CD, all of them.

Tue, 06/18/2013 - 10:02 | Link to Comment CheapBastard
CheapBastard's picture

Audi will recall more than 6000 hatchbacks due to the same gearbox safety concerns that prompted its parent company Volkswagen to announce a recall of almost 26,000 vehicles.

 

http://finance.ninemsn.com.au/newsbusiness/aap/8673429/safety-concerns-s...

 

Used to be quality cars.....

Tue, 06/18/2013 - 08:00 | Link to Comment RaceToTheBottom
RaceToTheBottom's picture

Loved the picture of the model drapped overthe crashed up car....  Loved her fake wounds...

Tue, 06/18/2013 - 08:00 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Might have something to do with no one having a job.

Tue, 06/18/2013 - 08:07 | Link to Comment Debugas
Debugas's picture

it is not just jobs

i can rent a car to drive around the city for 30 eurocents an hour plus 30 eurocents a kilometer.

i see no point in buying brand new city car for a 5 digit number - it will never pay off

 

Tue, 06/18/2013 - 09:18 | Link to Comment FeralSerf
FeralSerf's picture

Not to mention that parking is a problem. It's cheaper in Zürich to rent a car than it is to park it.

Tue, 06/18/2013 - 08:01 | Link to Comment Josephine29
Josephine29's picture

But UK inflation was up does that count?

 

What are today’s numbers?

Inflation is back on the rise again.

The Consumer Prices Index (CPI) grew by 2.7% in the year to May 2013, up from 2.4% in April

The RPI 12-month rate for May stood at 3.1%,(up from 2.9% in April)

A major influence on this month’s rise was transport costs as detailed below.

The majority of the contribution came from air transport and motor fuels. Air fares rose by 22.0% on the month this year compared with a much more modest rise of 1.4% in 2012. Petrol and diesel prices both fell, overall, between April and May this year but by less than a year ago.

There was also a rise in the cost of clothing and the only fall came from food and beverages. Those who have followed my Cauliflower watch updates on twitter will have noted that the price of Cauliflower’s did support this.

If we look at the underlying indices we see that the Retail Price Index has reached something of a threshold as a reading of 250 tells us that prices are 2 and a half times what they were when it was re-based in 1987.

http://www.mindfulmoney.co.uk/wp/shaun-richards/todays-rise-in-uk-inflat...

 

Tue, 06/18/2013 - 08:12 | Link to Comment Rip van Wrinkle
Rip van Wrinkle's picture

So the price of food fell in the UK? Really? Could anyone tell me where my food bill went down last month?

 

And 'beverages'...that was Osborne's coup de grace in the budget. He cut the tax by a penny a pint. What a f*cking genius he is.

Tue, 06/18/2013 - 09:48 | Link to Comment flapdoodle
flapdoodle's picture

Tesco has some out-of-date bangers and turnips on  sale - that must have pushed down the indices...

Tue, 06/18/2013 - 11:43 | Link to Comment Mototard at Large
Mototard at Large's picture

Horse, dog or beef?  :-)

Tue, 06/18/2013 - 12:43 | Link to Comment Navymugsy
Navymugsy's picture

I got a pineapple at Sainsbury's for 50p yesterday but everything else was expensive.

Tue, 06/18/2013 - 08:01 | Link to Comment rsnoble
rsnoble's picture

The avg consumer in the US would have to be an idiot to sign up for a new car loan in this economy.  And then get stuck with full coverage ins payments on top of it.  All they had to do was  introduce financing for everyone and prove once again they really are idiots.

Tue, 06/18/2013 - 08:18 | Link to Comment de3de8
de3de8's picture

This country is full of idiots. 7 year car loans and the latest is tires to rent!

Tue, 06/18/2013 - 11:26 | Link to Comment A Nanny Moose
A Nanny Moose's picture

and in CA you can add 10% sales tax to the whole transaction. By the time one puts gas in the car and pays licensing fees, over the life of the car, the State will make more off the sale of the car than the Manufacturer and the Dealer. What value has the State added?

Tue, 06/18/2013 - 08:06 | Link to Comment Dubaibanker
Dubaibanker's picture

Talking of 'growth' markets.....India is having 'negative growth' (lol) too......in car sales...among other things....I am looking for growth.....can someone (read Bernanke) direct me to it? / sarc

http://online.wsj.com/article/SB1000142412788732463430457853889204326100...

Tue, 06/18/2013 - 08:06 | Link to Comment ziggy59
ziggy59's picture

..But in the USSA, we are selling cars by the carloads full...

What the carload is loaded with..BS!

Tue, 06/18/2013 - 08:08 | Link to Comment B2u
B2u's picture

Why not give away cars for free, just like foodstamps and Obama phones.

Tue, 06/18/2013 - 08:19 | Link to Comment de3de8
de3de8's picture

Please, don't give them any more ideas.

Wed, 06/19/2013 - 01:34 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Actually, this has been done. Might even still be being done somewhere. Read about it a few years back where the govt somewhere (Philadelphia? Pennsylvania?) somewhere back east, I seem to recall, was actually giving cars to 'low income' types so they could get or work at jobs. Seriously.

Tue, 06/18/2013 - 08:44 | Link to Comment Debugas
Debugas's picture

if you realy think about the costs of production in terms of labour hours spent and go into the plant and see how everything is automated....

It looks like the cost of production is indeed close to zero (in man-hours terms)

Tue, 06/18/2013 - 09:00 | Link to Comment knukles
knukles's picture

Didn't they already try that with Cash for Clunkers and then a modified subsidy program with electro-mobiles?
Worked swell, just fucking swell.

Tue, 06/18/2013 - 08:14 | Link to Comment USisCorrupt
USisCorrupt's picture

Soon they will be offering a young Greek woman as an incentive with each purchase of a new vehicle.

Tue, 06/18/2013 - 08:44 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Throw in some Polish military hardware and a native female instructor and you've got yourself a deal.

http://www.youtube.com/watch?v=5huWVN54KYQ

Tue, 06/18/2013 - 10:08 | Link to Comment Bastiat
Bastiat's picture

That makes me sad.

Wed, 06/19/2013 - 01:36 | Link to Comment MisterMousePotato
MisterMousePotato's picture

The Polish military was at one time fearsome.

Wed, 06/19/2013 - 01:37 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Hm.

Actually, looking at that link, they might still be (fearsome, that is to say).

Maybe a little, tiny bit different use of the word "fearsome" than I intended at first, but, yes, fearsome they are. Fer sure.

Tue, 06/18/2013 - 10:28 | Link to Comment El Viejo
El Viejo's picture

Where do I enlist??

Tue, 06/18/2013 - 11:29 | Link to Comment A Nanny Moose
A Nanny Moose's picture

Why can't TSA agents look like that?

Tue, 06/18/2013 - 08:54 | Link to Comment WAMO556
WAMO556's picture

Ill take three please!

Women that is, forget the car!

Tue, 06/18/2013 - 09:06 | Link to Comment knukles
knukles's picture

Do that to Jack Nicholson in Five Easy Pieces ordering the toast....

 

Come to think of it, why free cars?
TAKE THE FUCKING BUS, ASSHOLES!

The government's already paying for it and nobody rides 'em plus they run on natural gas...
Another fucking triumph of ....

Ohneverthefuckmind.........

Tue, 06/18/2013 - 08:15 | Link to Comment Poor Grogman
Poor Grogman's picture

Who needs a car when .gov just sends you a check in the mail, and you can order groceries on the web?

Welcome to the new abnormal...

Tue, 06/18/2013 - 08:20 | Link to Comment SpanishGoop
SpanishGoop's picture

Check, mail ?

You are lagging behind.

 

Tue, 06/18/2013 - 09:07 | Link to Comment knukles
knukles's picture

EBT, EBT, EBT
And den you robs da delibery boy of de cash when he come to de house

Tue, 06/18/2013 - 12:11 | Link to Comment Abi Normal
Abi Normal's picture

You called?

Tue, 06/18/2013 - 08:17 | Link to Comment Racer
Racer's picture

And the Dax soaring aiming to take out all time highs asap

Tue, 06/18/2013 - 08:18 | Link to Comment JustObserving
JustObserving's picture

Car sales in Europe approaching 12 million units a year while China is expected to sell 20.66 million units this year.   Austerity is not working in Europe.

Tue, 06/18/2013 - 08:26 | Link to Comment SpanishGoop
SpanishGoop's picture

Well, the Chineese drive around with squinted eyes so the average lifespan before total-loss of a car is a bit shorter than in Europe.

 

 

Tue, 06/18/2013 - 08:49 | Link to Comment Headbanger
Headbanger's picture

They can't be any worse than the Russians at wrecking their cars

Tue, 06/18/2013 - 09:09 | Link to Comment knukles
knukles's picture

Seriously....
There's something genetically wrong with those people

 

and now for a message from our sponsor, the Georgia Guidestones...

Wed, 06/19/2013 - 01:39 | Link to Comment MisterMousePotato
MisterMousePotato's picture

What do you get when you cross a Mexican with an Asian?

Wed, 06/19/2013 - 01:39 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Car thief that can't drive.

Tue, 06/18/2013 - 08:48 | Link to Comment SmallerGovNow2
SmallerGovNow2's picture

Fauxterity, there is no Austerity...

Tue, 06/18/2013 - 08:21 | Link to Comment q99x2
q99x2's picture

They need to sell more submarines to Greece.

Tue, 06/18/2013 - 08:24 | Link to Comment aerojet
aerojet's picture

BMW jumped the shark.  They need to get back to what made their cars great and stop all this focus on idiotic electronic doodads that degrade before the car hits 100K.  Also, the 1-Series was supposed to be less costly, what happened?   They are with $2K of a 3-series!  

Tue, 06/18/2013 - 08:33 | Link to Comment Racer
Racer's picture

They also have a timing chain problem with 1,3 and 5 series, where the chain is at the back and needs the engine removed to fix it. Cost can be up to £8000 and BMW are claiming it isn't a design fault

Tue, 06/18/2013 - 09:53 | Link to Comment Bastiat
Bastiat's picture

Whoa, damn.

Wed, 06/19/2013 - 01:41 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Important safety tip there. (If you care about your wallet's health, that is.)

Tue, 06/18/2013 - 08:42 | Link to Comment spankfish
spankfish's picture

BMW = Bring More Wrenches

Tue, 06/18/2013 - 08:47 | Link to Comment Headbanger
Headbanger's picture

BMW = Biggest Money Waste

 

Tue, 06/18/2013 - 09:17 | Link to Comment TahoeBilly2012
TahoeBilly2012's picture

BMW= basic Marin wheels

Tue, 06/18/2013 - 10:34 | Link to Comment Zwelgje
Zwelgje's picture

BMW= Blow My Weeny

Tue, 06/18/2013 - 10:53 | Link to Comment Joe Sixpack
Joe Sixpack's picture

FIAT- Fix It Again Tony

Tue, 06/18/2013 - 12:25 | Link to Comment Bastiat
Bastiat's picture

The German joke version:

Bayerische MistWagen

"mistwagon" is a manure spreader.

Wed, 06/19/2013 - 01:41 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Why do the English drink warm beer?

Because Lucas makes refrigerators, too.

Tue, 06/18/2013 - 09:19 | Link to Comment otto skorzeny
otto skorzeny's picture

$60k for a 6 cylinder 5 Series is a fucking joke.

Tue, 06/18/2013 - 09:20 | Link to Comment markar
markar's picture

Tell me about it. My 5 yr old 5 with less than 60K miles had it's transmission control module crash. Cost to repair? $6k. No thanks on a car that was worth $13K. Dumped it for a Kia. Equal build quality & a much better warranty.

Tue, 06/18/2013 - 08:25 | Link to Comment firstdivision
firstdivision's picture

Who is jamming their finger up WTI's butt?

Tue, 06/18/2013 - 08:30 | Link to Comment slaughterer
slaughterer's picture

A: OPEC

Tue, 06/18/2013 - 08:31 | Link to Comment ChaosEquilibrium
ChaosEquilibrium's picture

What 8:10 news lifted ALL World markets and US Futures in unison?.....NONE!

 

Bernanke's 'Correlation Trade' finally achieved the goal as EVERYONE is on the same side of the boat---including 'bond vigilantes'!

This manipulated and crafted strategy will be the BLACK SWAN of Western Capitalism when the correlations break and markets attempt to 'CLEAR'.

 

the US automakers are not far behind....with the exception that 'car accounting' and dealer lot bulging is being allowed....after all the Majors could not be brought back from Insolvency to only dissolve into insolvency due to the same macroeconomic shock.

The US people would not stand for such FAILURE and would be in the streets like Turkey and Brazil.

Tue, 06/18/2013 - 12:22 | Link to Comment MarsInScorpio
MarsInScorpio's picture

Chaos:

 

I don't know where you are, but you are sadly out-of-touch with America.

 

"the Majors could not be brought back from Insolvency to only dissolve into insolvency due to the same macroeconomic shock.

The US people would not stand for such FAILURE and would be in the streets like Turkey and Brazil."

 

First, what makes you believe the "US people" have the slightest clue about what you just wrote?  Americans from their "dumbed down" schools can barely read and write - there's a reason why so many young people really believe you is spelled u.

 

Expecting them or their elders to have the slightest understanding of economic principles and their effects on society is insane. If they did have that understanding, Bernanke would be in prison, the FED would have been dissolved, Obama would have fled to Kenya for political asylum, the Supreme Court - aka Harvard Moot Court In DC - would have been locked up, the Capitol would have been cleansed of the scum called Representatives and Senators, and the Pentagon’s incompetent extension of the Military-Industrial-Orwellian Complex would have been hauled before a firing squad.

 

And that is just the DC scrubbing . . .

 

So if you want to know what will really set off the 47%, cut the government checks for becoming baby machines, throw the gang members into desert holding areas, make the sub-primers actually have to be able to qualify for a quality loan, cut the free meds, and the final action that will light the fuse of civil violence . . . turn off their free cable TV.

 

Of course, you'll only get insane, undirected violence with neither philosophical nor rational direction, but you will get the cities burning - a la 1965 Watts and Harlem.

 

Only this time the cops will let them burn because they don’t have anything or anyone in their family there to protect,  as you saw in the Rodney King riots when the cops ran away from the riots and hid out behind their sandbags at the various downtown precinct buildings.

 

Nothing will change in America except that DHS will finally have its excuse to shut down America the Free.

 

Now that's today's America.

-30-

 

Wed, 06/19/2013 - 01:47 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Shades of Columbine, Colorado ... remember the pictures of the 8,000 or so police and SWAT members cowering behind their cars because there were a couple of skinny dead teenagers inside armed with - gasp - a gun?

Didn't hesitate to point their fully automatic weapons and rocket launchers at a bunch of scared, innocent, unarmed children and screaming at them like Rambo, though, did they?

Tue, 06/18/2013 - 08:32 | Link to Comment f16hoser
f16hoser's picture

SourKraut Bitchez'

Tue, 06/18/2013 - 08:35 | Link to Comment e-recep
e-recep's picture

the car is becoming a luxury for the middle class.

Tue, 06/18/2013 - 08:37 | Link to Comment Seasmoke
Seasmoke's picture

I just did my part to help Germany. Sold a Mercedes and bought a BMW.

Although they are used. Sorry Angela.

Tue, 06/18/2013 - 08:52 | Link to Comment Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Finance people looking for new high yield investments look no further.

http://articles.latimes.com/2013/jun/08/business/la-fi-rent-a-tire-20130609

High prices are driving more motorists to rent tires Chains such as Rent-a-Wheel and Rimco are seeing business boom. Many consumers pay double or triple the cost of buying and face aggressive repossession policies.

...

Socked by soaring tire prices and short on funds, growing numbers of Americans are renting the rubber to keep their cars rolling.

Rent-to-own tire shops are among the newest arrivals to a sprawling alternative financial sector focused on the nation's economic underclass. Like payday lenders, pawn shops and Buy Here Pay Here used-car lots, tire rental businesses provide ready credit to consumers who can't get a loan anywhere else. But that access doesn't come cheap.

Customers pay huge premiums for their tires, sometimes four times above retail. Those who miss payments may find their car on cinder blocks, stripped of their tires by dealers who aggressively repossess. Tire rental contracts are so ironclad that even a bankruptcy filing can't make them go away.

Still, with payments as low as $14 a week, rent-to-own — long the province of sofa sets and flat-screen TVs — is proving irresistible for consumers desperate for safe transportation.

...

Economy recovery in action......... Finance industry prospers everyone else well not so much.

Tue, 06/18/2013 - 08:55 | Link to Comment MilwaukeeMark
MilwaukeeMark's picture

Why would anyone buy a new German car? I could afford a new German Luxury car but chose instead to by a low mileage E-Class (6000 miles) coming off of lease. Most new luxury cars are being leased because they cannot sell them outright. That means millions of low mile cars, 2 years old, coming off lease for 33% off sticker. The manufacturers just wants to swap them out for another 2 year high profit stint. They clean them up, give them a no cash down 1.99% rate, reload them with an extended warranty and full detailing and move them out. This is all supported by the fool who thinks his self worth is all tied to his brand new S-5, 5 Series or S Class. I get 4 years of driving a Luxury car under full warranty for less than the price of a new high end Toyota. Then I look for the next good deal.

Tue, 06/18/2013 - 11:18 | Link to Comment Non Passaran
Non Passaran's picture

Because some people are too rich.
Also there are others who prefer new to used.

Tue, 06/18/2013 - 09:00 | Link to Comment batterycharged
batterycharged's picture

Only 2 major cities in the US have populations that can afford to pay monthly payments on new cars. Washington DC is one of them.

Average starting MSRP's of over $20,000 don't compare well to a median wage of $26,000.

How long can auto companies push leases in the US and endure repos from risky borrowers?

 

 

Tue, 06/18/2013 - 11:16 | Link to Comment Non Passaran
Non Passaran's picture

It's time for a $90K Obamacar... Especially if Tesla hits a bump soon.

Tue, 06/18/2013 - 09:01 | Link to Comment FJ
FJ's picture

They can still do

...channel stuffing with dealers.

...cash for clunkers.

This is the most important industry in Germany...they will do everything to buy up excess supply.

Tue, 06/18/2013 - 09:10 | Link to Comment orangegeek
orangegeek's picture

Low sales?  No problem!!!

 

The car makers can sell their cars to the Audi graveyard.

 

http://www.zerohedge.com/news/2013-03-17/where-channel-stuffed-german-ca...

 

Or better yet, the car makers can build their own branded graveyards and make it a new growth industry.

Tue, 06/18/2013 - 09:20 | Link to Comment insanelysane
insanelysane's picture

The channel stuffing gimic like QE has been overplayed.  The channel stuffing numbers have too much divergence from the registration numbers.

Tue, 06/18/2013 - 10:55 | Link to Comment Lmo Mutton
Lmo Mutton's picture

How much for the model.

You can keep the klunker

Tue, 06/18/2013 - 11:04 | Link to Comment rosiescenario
rosiescenario's picture

1) Just wondering how much worse the decline would appear if the numbers were adjusted for population? Maybe they are actually hitting a 40 year low??

 

2) Also have to wonder how much of a decline in the collection of VATs this swan dive in auto sales represents??

Tue, 06/18/2013 - 12:26 | Link to Comment Two Theives and...
Two Theives and a Liar's picture

How about bringing over some of the high MPG clean diesels that Americans may actually want to buy? For example, VW makes 70-90 MPG diesels...only the Passat, Golf and Jetta are here that only get 40 MPG...heck my trouble-free Yaris gets that for at least $8,000 less...with no timinig belts to change or other issues. Come to think of it, my Yaris has 150,000 miles and has had NO issues whatsoever...

Germany has some work to do.

Tue, 06/18/2013 - 12:27 | Link to Comment Two Theives and...
Two Theives and a Liar's picture

How about bringing over some of the high MPG clean diesels that Americans may actually want to buy? For example, VW makes 70-90 MPG diesels...only the Passat, Golf and Jetta are here that get maybe 40 MPG...heck my trouble-free Yaris gets that for at least $8,000 less...with no timing belts to change or other issues. Come to think of it, my Yaris has 150,000 miles and has had NO issues whatsoever...

Germany has some work to do.

Tue, 06/18/2013 - 12:29 | Link to Comment Two Theives and...
Two Theives and a Liar's picture

Unsure how I created a double book entry...lol.

Tue, 06/18/2013 - 13:29 | Link to Comment AuEagleNest
AuEagleNest's picture

Meanwhile, Ferrari is limiting production and focusing on making more personalized, high-end Ferraris to increase their profit margin. They don't want just any old bankster to walk in off the street and be able to afford one.

Tue, 06/18/2013 - 13:56 | Link to Comment supermaxedout
supermaxedout's picture

I dont know why you are always looking to Germany. But ok if you want to have an idea how the situation is at present I'll give you some info - not propaganda.

Construction is booming - nobody knows how long its continuing but presently all companies in Germany in the construction busines are running at full capacity and the outlook till end of the year is still excellent.

Payment rises: Companies do pay more salary this year in average appx. 3.5 %.

Still plenty of open jobs in all kind of fields. The newspapers are each weekend full with many pages of open positions. Many foreigners arrivee from other places in Europe to fill the gap in the workforce.

So its not bad now and it looks like the next 12 months are not much different. Further outlook questionable but till now no signs that economy in Germany is slowing.

Wed, 06/19/2013 - 05:17 | Link to Comment gopher
gopher's picture

Most European new car "sales" are actually 1 year option-to-buy lease deals for employees, their friends, relatives, neighbours etc. Cheap credit helps make this model work...

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