ExpertEye European Automotive Report Q1 2017 | Page 3

Headlines . Important notice Due to the charging structure of Joomag this is the last edition being published this way. If you wish to continue receiving updates please email [email protected] and ask to be added to the circulation list Economic Climate • European GDP recovery outperforms US but rate of growth held back by structural issues • Almost a quarter of all Italian banks at risk of failure • Almost a third of those under 30 years of age in Europe are in temporary contracts • Private consumption remains the key driver of European growth New Vehicle Sales • Two out of the first four months of new car sales have seen negative growth for Europe’s three biggest car markets • A 3-percentage point increase in VAT in 2018 in Italy could push sales ahead of France in 2017 • New car and commercial vehicle sales expected to carry on growing across the EU28 until 2020 • Safeguarding employment in the automotive sector likely to ensure common sense prevails in Brexit negotiations Residual Values • The war on diesel is likely to see used values drop by 15%-20% over the next 5 years • Used car demand for diesel also falling creating a demand and RV risk for leasing companies and PCP funders • Car ownership in major conurbations and amongst millennials set to impact demand and with it used values • Legislation, bans and penalties are helping to boost electric and hybrid vehicle demand European Automotive Report - 2017 Quarter 1 2