For decades the Mondial de l’Automobile in Paris was one of the most important auto shows in the world – synonymous with the Geneva Motor Show, the Frankfurt IAA and the Detroit Auto Show. The Paris Salon in the fall has always been considered a kind of mood barometer for the coming car year. “The prospects will be doubly bleak in 2022,” says auto expert Ferdinand Dudenhöffer (71), of the CAR Center at the University of Duisburg (D).
On one side is the auto show itself, which will be open to fair visitors from October 17-23. After the corona-related cancellation of the 2020 fair, which takes place every two years, there should be a major restart this year. However, looking at the list of participants, a false start can be safely mentioned. Only the French brands Renault and its Romanian subsidiary Dacia, Stellantis brands Peugeot, DS and Jeep are represented, as well as two Chinese newcomers BYD and Great Wall. The list of absentees is huge: Audi, BMW or Mercedes. Ford, Hyundai-Kia, Toyota or Volkswagen. Alfa Romeo, Fiat, Mazda, Opel, Suzuki or Volvo. Not even Citroën is in the showrooms at home. Sad for the European auto industry: an auto show without automakers. “So the chances of Mondial surviving beyond 2022 should be close to zero,” Dudenhöffer says.
Dark predictions for Europe
However, the Paris auto show is still a good mood barometer: Gross domestic product (GDP) growth, which is directly related to car sales, will decline significantly in the coming years, according to forecasts from the International Monetary Fund (IMF). especially in Europe – from 5.9 percent this year to 2.1 percent in 2023. It only needs to grow 0.6 percent in 2024. For the US, once the world’s most important auto market, it currently only looks similarly bad, if not so bleakly – GDP growth there is expected to be 1.0 percent in 2024. Dudenhöffer expects the number of cars sold, particularly in Europe, to fall from 11.0 million to 10.8 million in 2022. The forecast for North America shows a slight increase from 16.1 million in 2022 to 16.3 million next year.
chinese locomotive
While the Western auto markets are at a stalemate, those in the Far East are picking up speed again. In particular, India’s GDP is expected to grow strongly – 6.8 percent and 6.1 percent respectively over the next two years. “But once again, China is taking over as a locomotive,” Dudenhöffer says. The world’s most populous country strengthens its economy with global repercussions with its economic stimulus programs. According to Dudenhöffer, the number of cars sold in China is expected to increase by about one million a year, from 21.1 million in 2021 to almost 24 million in 2024. Millions of new cars sold point to the climb. On the other hand, far fewer than 70 million new cars will be sold worldwide this year.
renaissance of discounts
However, for customers in Europe, negative growth prospects also have a positive side – at least if there is some money to invest. The few existing new cars were marketed at high margins, as manufacturers were able to produce fewer cars in the last two years due to the lack of semiconductors, deadlocks and fragile logistics chains. “In Germany, for example, new car discounts have never been as low in the last decade as they have been in the last few months,” Dudenhöffer says. This will end in 2023. “Inflation, high energy prices and recession are preventing new car purchases. With the year 2023 comes the renaissance of car discounts. And the dismal auto show in Paris is giving the starting signal.”