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Guest Post: European Car Engine Sputtering

Tyler Durden's picture





 

Submitted by Alexander Gloy of Lighthouse Investment Management,

According to data released by ACEA (European Automobile Manufacturers’ Association)  new passenger car registrations fell 8.9% in August after a decline of 7.8% in July.

European car markets are quite diverse; it makes more sense to look at them individually:

 

The PIIGS are firmly in control of the bottom (what’s up with those Nordics, Sweden and Finland?). Of the major markets, only the UK and Switzerland (thanks Mr. Jordan for the EUR/CHF peg) are in positive territory.

IMF-rebel Hungary seem to be doing fine while bail-out-escapee Iceland is shooting out the (head-) lights (with a total of 473 cars registered in August).

For trend analysis we look at 12-months moving averages, with 2007 = 100.

The top 5 markets by volume are Germany, France, UK, Italy and Spain:

 

Italy and Spain are showing little signs of recovery after shedding 40-60% of their 2007 registrations. Germany held up well, but has joined France in trending lower. The UK is holding up well considering it being in a recession.

Markets # 6-10:

 

Sweden, Belgium, Austria, and, to lesser extent, the Netherlands are rolling over. In Switzerland, consumers rushed to purchase imported cars as dealers had to pass on currency gains from Swiss Franc strength.

Finally, these fine markets:

 

Countries bailed-out with EU taxpayer money (Greece, Ireland, Portugal) display worsening trends. Non-bail-out countries like Iceland and Hungary had initially larger drops, but are on a recovery since then.

In 2011, Germany produced 5.8 million passenger cars, of which 77% (4.5m) were exported, making cars and parts the most valuable export good (EUR 185bn). Europe absorbs 60% of those exports. Almost a quarter of exports is going to the UK, with a similar amount going to China and Taiwan.

Conclusion: A heavily export-dependent German automotive industry looks vulnerable to setbacks in important markets.

 


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Thu, 09/20/2012 - 15:55 | Link to Comment Haager
Haager's picture

Something seems to be done very right in Iceland that other countries didn't do. Oh, they didn't bail out the banks...

 

Thu, 09/20/2012 - 15:58 | Link to Comment NotApplicable
NotApplicable's picture

Why does the Icelandic culture hate freedom?

Thu, 09/20/2012 - 16:06 | Link to Comment Strut
Strut's picture

Shh! We don't talk about Iceland.

Thu, 09/20/2012 - 16:24 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

There has never been a better time
to buy or lease a new 
Opel Ampera

Fun to drive with
370 Nm instant tourque!

Drive 40-80 km on pure electricity!

Hurry, while supplies last!

 

The battery takes about 6 hours to fully recharge using the boot stored charging cable. The Ampera can be plugged into a 240-volt/10 amp household outlet.

In the worst case, repeatedly recharging any electric vehicle at 16 A from a worn or damaged socket could cause overheating at the socket.

Reasons for being unable to charge could be a significant voltage drop between the neutral and protective earth circuit (indicating too-long wire lengths between distribution box and socket, a too-small wire gauge, or a bad connection); inadequate earthing/grounding impedance (indicating a missing or bad ground connection at the socket, distribution panel, or earth/ground point); or a non-dedicated electrical installation (indicating additional loads on the circuit). In general a dedicated circuit is required to charge the Ampera.

 

Thu, 09/20/2012 - 16:27 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

I'll take one "nicely equipped".   I'll park it next to my platinum-edition Escalade in my circular 15-car EverStonePaveLock Italian quartz driveway.

Thu, 09/20/2012 - 16:33 | Link to Comment cougar_w
cougar_w's picture

My '71 Opel GT looks better than that thing.

The car I mean. The woman is so-so.

Thu, 09/20/2012 - 16:45 | Link to Comment yochananmichael
yochananmichael's picture

not a close up , but she looks hot to me.

Thu, 09/20/2012 - 17:06 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

Put the convention bag over that sneering Euro-snob head FIRST

Thu, 09/20/2012 - 15:59 | Link to Comment Dareconomics
Dareconomics's picture

And they have their own currency. If only Portugal, Ireland, Italy, Greece and Spain had old currencies they could start using, then they could end this debt crisis.

dareconomics.wordpress.com

Fri, 09/21/2012 - 09:29 | Link to Comment Ar-Pharazôn
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and what do you think they will do a part printing more money (aka DEBT)?

Thu, 09/20/2012 - 15:57 | Link to Comment NotApplicable
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"Malinvestment, bitchez!" -- Mises

Thu, 09/20/2012 - 15:57 | Link to Comment Blasé Faire
Blasé Faire's picture

I can only imagine what the typical used car salesman is like in some of those countries.

Thu, 09/20/2012 - 16:21 | Link to Comment cougar_w
cougar_w's picture

Used car sales might be quite brisk, if they are not included in these numbers. I know around here, there are cars on the lots re-po'ed that look to be under a year old, sold for used.

Thu, 09/20/2012 - 15:58 | Link to Comment The Count
The Count's picture

In other news:

SELL APPLE STOCK NOW. THE HYPE IS IMMENSE AND UNSUSTAINABLE. THE PRODUCT NOT UP TO STEVE JOBS STANDARD ANYMORE. MAP APPLICAITON A TOTAL FAILRURE. SELL SELL SELL

Thu, 09/20/2012 - 16:01 | Link to Comment Bunga Bunga
Bunga Bunga's picture

... but but but they can even create new airports:

http://searchengineland.com/irish-politician-calls-apples-new-maps-dange...

 

 

Thu, 09/20/2012 - 16:22 | Link to Comment cougar_w
cougar_w's picture

Caught short again were we?

Fri, 09/21/2012 - 03:10 | Link to Comment Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

You're right.  Steve's quality control is gone.  Check this out: http://theamazingios6maps.tumblr.com/  

 

Time to short

Thu, 09/20/2012 - 15:58 | Link to Comment slaughterer
slaughterer's picture

GREEN Mfers.  That is the only comment w-while in Fed-land for next 2-3 months  FUK shorts.  

Thu, 09/20/2012 - 15:59 | Link to Comment fonzannoon
fonzannoon's picture

Poor Biderman got eaten up by Schiff and sharted out by GS

Thu, 09/20/2012 - 15:58 | Link to Comment Bunga Bunga
Thu, 09/20/2012 - 15:59 | Link to Comment yogibear
yogibear's picture

LOL, Iceland defaulted on the banksters and now their economy is in recovery. The PIIGS should lave followed Iceland's lead.

Thu, 09/20/2012 - 16:24 | Link to Comment cougar_w
cougar_w's picture

Iceland was small enough to be allowed to go their own way.

Thu, 09/20/2012 - 16:30 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

The first one out of the burning theater did not panic.

Thu, 09/20/2012 - 22:42 | Link to Comment Element
Element's picture

You may or may not be aware that Iceland implied Russian military basing and alliance was on offer from Iceland, in order to secure Russian bailout loans, after Lehman's imploded.

http://www.icelandreview.com/icelandreview/search/news/Default.asp?ew_0_...

No one in NATO (NORTH ATLANTIC Treaty Organisation) wanted to risk that occurring right in the middle of what they were supposed to be all about, so they allowed Iceland to go it's own way.

http://www.icelandreview.com/icelandreview/daily_news/?cat_id=16539&ew_0...

Iceland basically had to make blunt geopolitically-loaded threats to force NATO sphere bankers to negotiate.  Iceland may be small but they are also a crucial strategic linchpin to protect NATO states from Russian SSBNs:

https://en.wikipedia.org/wiki/GIUK_gap

The Icelandic crisis is a good example of why geopolitics is underestimated with regard to how the PIIGS situation will play out. Questions of physical survival, are always going to trump elite banking self-preservation moves, and money preservation concerns.  And Banksters and Political puppets do respond, if you have a strong enough and damaging enough diplomatic and strategic hand to play, longer-term.

Fortunately Iceland did have that, knew they did, and understood how and when to use it, to assure their own security and best interests.  It's good to be a Sovereign state i.e. have your own currency and flexible foreign policy options that actually protect and serves your own needs and interests.

Fri, 09/21/2012 - 07:43 | Link to Comment e-recep
e-recep's picture

Icelanders are terrorists. </sarc>

Thu, 09/20/2012 - 16:01 | Link to Comment slaughterer
slaughterer's picture

For the AAPL short bevor: HUH?? AAPL $800 before $600.  Go ahead and short, if you need to loooozzeee $$$$>  Who cares about SJ?   (OK, I am obnoxious, Stockholms syndrome, tomorrow I toe the ZH red-neck doomer line, but today, I love Simon Potter and his Bayesian methods, luv em. amd ZH haas never even mentioned Bayse, although th fed luvs Bayse)>  

Thu, 09/20/2012 - 16:02 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Let be optimistic.  let's say that the earth becomes an efficient producer like Germany.  Who would the world's customer be?  Mars?

Thu, 09/20/2012 - 16:05 | Link to Comment slaughterer
slaughterer's picture

Mars?  FUK NO, CHINA!!  LOL.   

Thu, 09/20/2012 - 16:09 | Link to Comment LawsofPhysics
LawsofPhysics's picture

no, china is still part of the earth.  I mean let's face facts, the eltites wet dream is to have everybody work for chinese wages and then to simply be slaves.

Thu, 09/20/2012 - 16:21 | Link to Comment slaughterer
slaughterer's picture

OK, LOP, +1.  You Earned it.  But what currency they got on MARS?   

Thu, 09/20/2012 - 17:07 | Link to Comment 12ToothAssassin
12ToothAssassin's picture

Water

Fri, 09/21/2012 - 07:58 | Link to Comment AnAnonymous
AnAnonymous's picture

the eltites wet dream is to have everybody work for chinese wages and then to simply be slaves.

____________________

Elites, hard to know. But 'americans' would want a source of human labour cheaper than the chinese.

Through 'american' economics, 'americans' planned a world tour of misery that should have worked the following:

-Allocate resources to an activity into an area
-locals work
-by product: locals use the share of consumption to better their own environment
-inflation, which shows through demand for higher wages
-'american' declaration that locals no longer want to work as they keep asking for higher wages
-activity is moved elsewhere

Repeat.

A world tour of misery as 'americans' would chase people who are interested in working from an 'american' point of view.

China derailed the process by trapping activity for much longer than desired by 'americans'

It is clear that by 'american' goals, chinese are already too rich and are asking too big a share of consumption.

'Americans' want a cheaper labour force than Chinese...

Thu, 09/20/2012 - 16:30 | Link to Comment cougar_w
cougar_w's picture

There is nothing outside the earth system to be exploited for performance gains. The earth as a whole system cannot become more efficient, except perhaps to do different things better.

Thu, 09/20/2012 - 16:05 | Link to Comment Urban Redneck
Urban Redneck's picture

Thanks to the SNB, I can't buy a new Mercedes imported from up the street in Germany for the same price as a Big Mac at ZRH.

Switzerland's 8.7% increase in new registrations would be a lot a higher w/o the peg, at least until until all those employed by exporters lost their jobs... But since I need to replace a car now, the peg kind of sucks.

Thu, 09/20/2012 - 16:45 | Link to Comment Ratscam
Ratscam's picture

Do not forget that due to the 9/6/11 SNB intervention, the CHF/Gold price jumped considerably.
If you want to hold on to your physical gold and use fiat to buy your Audi/Posche/BMW/Mercedes/VW, contact Chris at upriver.ch they are spezialized in importing german cars for considerable discounts.

Thu, 09/20/2012 - 17:33 | Link to Comment Urban Redneck
Urban Redneck's picture

Thanks for the info.   I would never trade physical metal for any car.   However, I would actually take the '71 Challenger on their website over a new German car any day.

Thu, 09/20/2012 - 16:06 | Link to Comment PontifexMaximus
PontifexMaximus's picture

Germany will do the utmost to export, whatever it cost's to finance GR, ES and so on, in order to guarantee (full) employment in Deutschland. Never forget, dear Angela from Ostdeutschland want's to be reelected and she will be.....

Thu, 09/20/2012 - 16:08 | Link to Comment Global Hunter
Global Hunter's picture

ZH poster Dork of Cork was posting about this (in part) on an earlier story, biggups

Thu, 09/20/2012 - 16:08 | Link to Comment kito
kito's picture

it doesnt matter anymore. the ecb will just buy up the excess inventory....................................there is no free market anymore.................

Thu, 09/20/2012 - 16:11 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Correct, cnetral banks are monetizing the earth for fear of deflation/default and losing power once the defaults clear out the bad management and bad behavior.  The moral hazard is the only thing that needs to be addressed to fix anything.  The paper-pushers know there is no real value in their labor.  Long black markets....

Thu, 09/20/2012 - 17:31 | Link to Comment Bunga Bunga
Bunga Bunga's picture

But you can redeem an old car in exchange for a carload of money.

Thu, 09/20/2012 - 16:11 | Link to Comment Taint Boil
Taint Boil's picture

 

 

Dude, the person who picks the pictures for the articles on ZeroHedge is a genius... too funny.

Thu, 09/20/2012 - 16:12 | Link to Comment Dr. Engali
Dr. Engali's picture

My conclusion is if you take the pain up front then you recover quicker rather than the suffering of a drawn out slow painful bleed.

Thu, 09/20/2012 - 16:16 | Link to Comment Money 4 Nothing
Thu, 09/20/2012 - 16:24 | Link to Comment walküre
walküre's picture

And then it was officially a Depression - capital D

So what if the ECB buys up every sovereign bond - which they can't - but even so?

People without jobs won't be buying cars. People with jobs but facing potential job loss won't be buying cars. People with jobs and perceived job security won't buy cars when money might as well get flushed down the toilet. Nobody has money to waste, nobody. Government (!) faced with austerity won't be buying cars or replacing fleets. Rental car companies won't buy cars when rentals are down and cars don't need replacement as soon as under regular capacity ops.

Car manufacturers in Europe have learned the hard way that China can manufacture the product much cheaper thus making margins on German cars for example less attractive. Chinese have their own sets of problems anyhow.

Anyone who understands the European economy which is by and large the German economy, knows how important the car and truck manufacturing sector is to the overall well being of the economy.

FUBAR

Thu, 09/20/2012 - 17:35 | Link to Comment ghostfaceinvestah
ghostfaceinvestah's picture

A large % of German cars are purchased in the USA, with its re-born subprime auto loan financing.  Once the US is finally forced to reign in out of control government spending, that market will dry up.

Thu, 09/20/2012 - 16:40 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

The problem with Europe is the core , not the periphery.....

The periphery feeds the core Oil capital withen the Euros corrupt market state capital structure.

Germany then wastes this energy /capital on mercantile oil consuming exports......France is making some efforts to change its fixed capital and transport investments but Germany is on auto pilot for the most part.

www.nantes-chateaubriant.paysdelaloire.fr/

 PS

omrpublic.iea.org/demand/ct_ho_ov.pdf

Whats really striking in the above graph is the rise of Icelandic heating oil demand …….at a guess I think during the heart of their crisis people remained in the capital where communal thermal volcanic heating was available cheaply and then when more disposable income was available they moved out to their more isolated second houses – but its just a Dorks speculation.

Fri, 09/21/2012 - 08:01 | Link to Comment AnAnonymous
AnAnonymous's picture

Or icelanders are just capping some oil resource released from elsewhere.

It has to be consumed. So if somewhere, an 'american' can not do the consumption job, it is an opportunity for another 'american' to do the consumption job.

Thu, 09/20/2012 - 16:44 | Link to Comment yochananmichael
yochananmichael's picture

how's gubmint Motors doing in Europe?

Thu, 09/20/2012 - 16:54 | Link to Comment Schmuck Raker
Thu, 09/20/2012 - 17:20 | Link to Comment Floodmaster
Floodmaster's picture

Europe's generous pension system is breaking the back of the new generation,The reverse pyramid wil bring crisis after crisis for the next 30 years...

Thu, 09/20/2012 - 17:34 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

This is where investment should be directed as the private car industry is  the rail industry post Great War.

en.wikipedia.org/wiki/Ligne_du_Haut-Bugey

Reusing old lines rather then building new very capital intensive high speed lines

AT the main line (international level)

www.youtube.com/watch?v=L-4VDI2-2fs

 At the local market town level

www.youtube.com/watch?v=52dJdA3IaGY

 City passsenger transport.

www.youtube.com/watch?v=iIEiFgSxiWs

Thu, 09/20/2012 - 17:29 | Link to Comment Sandmann
Sandmann's picture

The UK is holding up well considering it being in a recession.

 

The bulk of new cars registered in the UK are company cars usually leased.  What matters is the price of Used Cars since that sets the terminal value in the lease. Mercedes, BMW, Porsche are most often leased with the manufacturer propping up the resale values. Also, of £37 billion paid in bonuses in the British economy, 33% was in the FIRE sector which is also a big operator of leased vehicles often through captive subsidiary businesses

Thu, 09/20/2012 - 18:13 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

Somebody better write a paper on the dramatic change in Transport patterns in the UK ……….(all time record rail passenger numbers)I feel it must have something to do with QE despite its reported non effects in come circles.

ACEA

In June, new bus and coach registrations increased by 16.5%, boosted by the good performance recorded in the UK (+97.9%), Germany (+39.0%) and France (+24.5%). The Spanish (-15.4%) and Italian (-21.5%) markets declined. From January to June, the segment of buses and coaches was the only one to expand (+5.2%), driven by the upturn in the UK (+67.2%) and Germany (+7.1%). Results in France (-11.8%), Italy (-30.0%) and Spain (-38.8%) were negative”

UK Bus regs Jan – June : 4,473 !!!!!!!!!
Germany Jan – June :2,409
France ,Italy , Spain combined :4,581

But flat bus transport passenger numbers......reported in British Bus September transport stats....strange.

The IEA in their  July report talks of a flattening of European efficiency gains because of suppressed investment in capital stock……

 

UK Tram passenger 2011 /12 statistics

http://www.dft.gov.uk/
2011/12 : 204 million passenger journeys (highest modern numbers ever)
2010 /11 :196.5 million.

Docklands increased from 78.3 to 86.1 million
Croydon increased from 27.9 to 28.6 million
But outside London with the exception of Manchester tram passenger numbers are declining or stable which perhaps reflects the farming of London’s more local hinterland of wealth as people begin to run out of money tokens.

Manchester 19.2 to 21.8 million
Tyne Metro decline – 39.9 to 37.9 million
Sheffield unchanged at 15 million
Nottingham decline – 9.7 million to 9 million.

I am not sure the UK GDP numbers are reflecting the true picture….. much of the decline was because of a drop in house construction which is a waste of resourses in my book
However the lack of british fiscal investment in railways is now creating major capacity problems down south.

Thu, 09/20/2012 - 23:26 | Link to Comment Sandmann
Sandmann's picture

Still cheaper to go long-haul by bus rather than train especially from Northern England to London. Fares are simply ridiculous

Fri, 09/21/2012 - 07:26 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

@Sandmann

The London elite and middle class simply have the tokens for rail - rail is more expensive as it requires larger labour inputs but lower energy costs per passenger over most journeys when looked at in a holistic level.

Its a reflection of a deep monetary /class problem  rather then a transport problem.

Used to get stung a lot in Scotland with the coach bus system - a journey half way to the terminus almost costs as much as the entire journey.

Found the rail system cheaper for short trips in remote & flag stopping stations which does not really make sense unless when you begin to think those Bus companies were taking advantage of people with no rail option.

Explains the dramatic increase in passengers in towns near & north of Inverness.

en.wikipedia.org/wiki/Dingwall_railway_station

 

 

Thu, 09/20/2012 - 23:28 | Link to Comment Sandmann
Sandmann's picture

Southern Region always had the biggest subsidy and highest frequency over short distances. East Coast Main Line has not had subsidy for over 2 decades.

Fri, 09/21/2012 - 08:05 | Link to Comment AnAnonymous
AnAnonymous's picture

But outside London with the exception of Manchester tram passenger numbers are declining or stable which perhaps reflects the farming of London’s more local hinterland of wealth as people begin to run out of money tokens.

_________________________

Worthwhile remark. 'Americans' wishing to exile themselves to some country land because life is going to be easier are once again relying on the protection of the government state from their invalid conclusions.

Thu, 09/20/2012 - 18:18 | Link to Comment PSEUDOLOGOI
PSEUDOLOGOI's picture

ICELAND @ 51%?????? Are you frikin' kidding me???

THe rest of of them, like Greece to start with, are 1000% idiots.

Do what Iceland did.  it's certainly a way out.  but not the banksa's way out obviously...

Thu, 09/20/2012 - 18:23 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

The British spend very little money on rail.......

Their Potyomkin rail village is the Chiltern Main Line which gives the impression private companies are spending money on the rail bed infrastruture.....but outside this line they are mostly not.

"Chiltern Railways chairman Adrian Shooter said, "This is the biggest passenger rail project for several generations not to call on the taxpayer for support. Working closely with Network Rail, we are going to create a new main line railway for the people of Oxfordshire and the Midlands. This deal demonstrates that real improvements to rail services can be paid for without public subsidy by attracting people out of their cars and on to trains."

en.wikipedia.org/wiki/Chiltern_Main_Line

The lack of fiscal spending will catch up with them soon.

Fri, 09/21/2012 - 09:27 | Link to Comment Ar-Pharazôn
Ar-Pharazôn's picture

i am swiss and i bought a renault in Italy.

 

spared 30% of the total price buying the car in italy

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