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Poland Autos Report Q3 2010
Management Report
Published: June 2010
Pages: 57
Tables: For full details, please email keithw@cmsinfo.com
From: GBP 353.33 Buy Now!
Research from: Business Monitor International
Sector: Automotive
Auto sales have been rising in Poland, according to preliminary data from the Central Register of Vehicles (CEP). New car sales rose 37.67% month-on-month in March, when 29,606 units were shifted, the automotive research association Samar reported. The figures are encouraging, and suggest that auto sales are past their worst. Consumers in Poland have not been hit as hard as elsewhere in Europe, as the country weathered the economic downturn better than most of its neighbours and averted recession last year.
Auto sales have been rising in Poland, according to preliminary data from the Central Register of Vehicles (CEP). New car sales rose 37.67% month-on-month in March, when 29,606 units were shifted, the automotive research association Samar reported. The figures are encouraging, and suggest that auto sales are past their worst. Consumers in Poland have not been hit as hard as elsewhere in Europe, as the country weathered the economic downturn better than most of its neighbours and averted recession last year.
However, we are still cautious about the near-term outlook for sales, as Poland still faces problems, such as dealing with a widening budget gap. According to Bloomberg, the EU estimates Poland?s budget gap will rise to 7.5% of the country?s gross domestic output this year. As the country moves to get its finances in order, it may impose measures that dampen consumer spending. Anecdotal evidence supports the view that buyers are not rushing to make purchases of expensive items like new vehicles. Car dealers say that business conditions remain difficult and that sales are still in a slump.
The challenges on the production front are more worrisome. Greece’s debt problems are threatening to spill over and trigger a widespread crisis in Europe, which could significantly slow down the worldwide economic recovery. It would also deal a blow to Poland’s auto manufacturers, which export around 90% of their output. Auto production in Poland fell 3.6% y-o-y, to 867,542 units, in 2009 and the latest output figures show manufacturers are still struggling to recover. In March, combined passenger car and light commercial vehicle production fell 0.09%, to 89, 751 units, according to Samar.
Poland is the sixth largest auto producer in the EU. But its position is under threat from neighbouring rivals offering foreign firms similar benefits such as a low-cost base. No auto factories were built in the country in the last decade, according to the head of the Polish Automotive Industry Association, Jakub Farys. He told daily newspaper Rzeczpospolita that Poland had lost foreign investment projects from companies such as Kia Motors, Hyundai Motor and Toyota Motor.
However, on the bright side, the industry continues to attract investment from producers of auto parts and accessories. Japanese tyre maker Bridgestone invested EUR105mn (US$141.6mn) in its tyre factory in Poznan to boost production capacity. The plans, announced in April, come on the back of rising European demand for high-end tyres. According to a report in Rzeczpospolita, the majority of the PLN500mn slated for investment in the Katowice Special Economic Zone in Q110 was from makers of auto parts. The head of the special economic zone told Rzeczpospolita that 60% of new investments in the zone in 2010 are expected to be related to the auto sector.
However, we are still cautious about the near-term outlook for sales, as Poland still faces problems, such as dealing with a widening budget gap. According to Bloomberg, the EU estimates Poland?s budget gap will rise to 7.5% of the country?s gross domestic output this year. As the country moves to get its finances in order, it may impose measures that dampen consumer spending. Anecdotal evidence supports the view that buyers are not rushing to make purchases of expensive items like new vehicles. Car dealers say that business conditions remain difficult and that sales are still in a slump.
The challenges on the production front are more worrisome. Greece’s debt problems are threatening to spill over and trigger a widespread crisis in Europe, which could significantly slow down the worldwide economic recovery. It would also deal a blow to Poland’s auto manufacturers, which export around 90% of their output. Auto production in Poland fell 3.6% y-o-y, to 867,542 units, in 2009 and the latest output figures show manufacturers are still struggling to recover. In March, combined passenger car and light commercial vehicle production fell 0.09%, to 89, 751 units, according to Samar.
Poland is the sixth largest auto producer in the EU. But its position is under threat from neighbouring rivals offering foreign firms similar benefits such as a low-cost base. No auto factories were built in the country in the last decade, according to the head of the Polish Automotive Industry Association, Jakub Farys. He told daily newspaper Rzeczpospolita that Poland had lost foreign investment projects from companies such as Kia Motors, Hyundai Motor and Toyota Motor.
However, on the bright side, the industry continues to attract investment from producers of auto parts and accessories. Japanese tyre maker Bridgestone invested EUR105mn (US$141.6mn) in its tyre factory in Poznan to boost production capacity. The plans, announced in April, come on the back of rising European demand for high-end tyres. According to a report in Rzeczpospolita, the majority of the PLN500mn slated for investment in the Katowice Special Economic Zone in Q110 was from makers of auto parts. The head of the special economic zone told Rzeczpospolita that 60% of new investments in the zone in 2010 are expected to be related to the auto sector.