ExpertEye European Automotive Report Q1 2017 | Page 23

being cleared out, March 2016 was the strongest month last year and that April 2017 saw the
registration of a significant volume of rental vehicles. YTD, Portugal’s new car sales are currently
5.8% up over the same period in 2016 and we fully expect the full year new car sales to rise by around
7.5% to 222,000 cars for 2017 and get close to 230,000 for 2018.
As anticipated demand for commercial vehicle sales has improved as the construction sector picks up
and we start to see investment from other industries. Light commercials rose 20.4% in April putting
the YTD at a 10.6% increase and we expect growth to continue with the full year likely to see LCV
sales up 18% over 2016.
Residual values in Q1 were marginally negative with only three of the top ten strongest RV brands
seeing a positive upswing and this was generally on the back of new products. Amongst the premium
German brands BMW and Mercedes-Benz have seen a total switch in fortunes over the last six months.
Mercedes-Benz has moved from outside the top 10 to take second place as its refreshed line up
continues to be well received in the market, whilst BMW has fallen from second to sixth place over
the same period although that still represents only a single percentage point drop in average RVs.
Volkswagen are currently having a tough time in the Portuguese market. Amongst the top 10 brands
by new car sales, Volkswagen are currently struggling with new car sales dropping by 3.4% April 2017
YTD compared to an 8.9% increase for the top 10 as a whole. They are also seeing challenges with
their residual values, with RVs falling 2.8% in Q1 which was the worst performance amongst the top
10 RV performers by brand.
The closed nature of the Portuguese used car market makes it far less responsive than most left-hand
drive markets and this has helped suppress RVs. However, we now think the significant turnaround in
Portugal’s economy should start to lift RVs by a couple of percent through the back end of 2017.
European Automotive Report - 2017 Quarter 1
22