Europe 2013?

So what does the next 12 months look like? The effect of the factory closures will not be felt quickly enough and the measures are still not extensive enough to prevent further discounts and self-registrations. Even with further discounting, registrations are still likely to fall by around three to four per cent next year as Original Equipment Manufacturers (OEMs) near their limit on how far they can go with discounting, self-registration incentives and dealer demonstrators. The one- to five-year-old car parc will also continue to shrink, and whilst it is not enough to see an increase in used car values it will reduce the rate of decline.

RVs for vehicles in the smaller segments across Europe are likely to continue to benefit at the expense of larger models as consumers attempt to save money. This can also be seen by the choice of more fuel-efficient and lower emission models, for example the average emission level of new cars in the UK fell by 3.5% to 133.2g/km.

Whilst the UK stood out from the rest of Europe in 2012, 2013 is likely to be a tougher year as RVs of young used vehicles will come under pressure as OEMs seek to exploit the strong market and favourable exchange rates to push new car sales.

Overall it looks like another tough year ahead across Europe, with overcapacity remaining the burning issue. Discounting is likely to remain strong and buyers will continue the trend for smaller vehicles and especially more efficient ones. The trend towards premium feel products and brands is also likely to continue as buyers want something to make them feel good whilst also trying to save money. Meanwhile OEMs will need to push ahead on the technology front with things like Smartphone interfaces into the in-car entertainment systems and digital radios as standard if they want to differentiate themselves without having to just offer further discounts.