So are all European manufacturers broken? No. Renault, European No. 3, is for the moment the exception to the rule. The group, which has multiplied partnerships to lower its development costs, is at the same time pursuing its strategy of selling many fewer vehicles but for more, celebrated in a documentary to be published on Amazon Prime. The diamond group has already regained satisfactory margin levels and the favor of investors, and is launching its major offensive in 2025 with the arrival of the electric R5. To a lesser extent, the Japanese Toyota and the Sino-Swedish Volvo have seen their sales increase significantly in Europe thanks to their hybrid and electric models.
Difficult turns towards electric
But behind these successes, “the entire European automotive sector is facing an uneven electric shift, aggressive competition from Chinese manufacturers with adjusted cost structures and weak demand in the region”, underlined the Moody's agency in a report at the end of November. Sales in Europe remain well below pre-covid figures, with some factories running empty. The shift towards electric has not kept its promises, with falling vehicle prices and subsidies reinforcing motorists' wait-and-see attitude. Both Volkswagen and Stellantis have also seen the launch of their electric offering slowed down by electronic problems on their new models.
Moody's therefore forecasts a year 2025 that will continue to be complicated with moderate growth in sales, continued fierce competition on vehicle prices, limiting margins, and therefore a continuation of restructuring measures. Large equipment manufacturers like Bosch, ZF, Valeo are also slowing down and are increasing their announcements of job cuts. The entire industrial sector is also suffering from energy prices.
Two scenarios for 2040
The difficulties of the two European leaders also correspond to a historic moment in the automobile industry, where Western markets (Europe, United States and Canada) have reached, and in some cases exceeded, the “automotive peak” in terms of sales of new vehicles. vehicles, according to a study by the Roland Berger firm. Growth is now in China but also in India and South America.
-By 2040, two scenarios are emerging, according to the firm: Western manufacturers could continue to suffer from stagnant or declining sales, increasing pressure on costs and a major need for restructuring, while the Chinese will take market shares (15 to 20% in Europe). Westerners could also continue to invest massively in technology, benefit from their good brand image and solid production and distribution networks.
