ExpertEye European Automotive Report Q2 2016

Headlines . Economic Climate  Euro area GDP above pre-crisis levels but the recovery has been slower and taken longer than for other global economies  The current economic climate creates more downside risks than upside opportunities    A new banking crisis is looming across Southern Europe. Bank “stress” test results are awaited in Italy, Greece and Portugal Brexit casts a long shadow of uncertainty but the economic mood is improving IFRS 16 Leases puts leased assets back on the lessee’s balance sheet, but the impact expected to be minimal for the industry New Car Sales  Continuing to rise with the 2007 sales record set to be beaten in 2017  Internal combustion engines could be banned by 2025 in some regions and heavily restricted in others in less than four years   France could slip to being the fourth largest car market in 2018 Falling sales expected from 2019 due to Brexit and other factors with some countries already facing a downturn in sales Residual Values  RVs have been enjoying a strong post-crisis recovery but this growth looks set to come to an end in 2016  SUVs continue to be the “in demand” segment seeing some of the strongest growth in sales, demand and RVs   Major falls not expected across Europe although the UK will see declining RVs over the next year or two The volatility in the euro is causing market disruption to RVs in a number of countries outside the euro European Automotive Report - 2016 Quarter 2 2

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