When European carmakers published their sales and revenue results for the first quarter in late April, the continent was in the midst of widespread COVID-19 lockdowns that had shuttered factories and dealer showrooms. At the time, executives warned that second-quarter results would be dire, and most scrapped their full-year forecasts, citing uncertainty around the pandemic. But the results, in many cases, were not as bad as feared.
That's because automakers learned their lesson after the global financial crisis triggered by the collapse of Lehman Brothers in October 2008, said Juergen Pieper, director of research and autos analyst at Bankhaus Metzler in Frankfurt. He spoke with Automotive News Europe Correspondent Christiaan Hetzner about the surprising resilience of the industry and changes at the top of key automakers.
No one knew quite how bad the second quarter would be. Now that the reporting season just ended, what is your conclusion?
The collapse in revenue was extreme, especially for some of the suppliers where it was up to 50 percent. When you look at profits and cash flow of the vehicle manufacturers, however, they were not as catastrophic as feared. Nowhere did you see a real collapse in underlying earnings performance. Crisis management was better than 10 years ago even though this was far more severe.
Who delivered the biggest surprise?
PSA Group once more was impressive in terms of profitability. Even Opel was able to achieve a 2 percent margin in the first half -- a very strong performance for this chronically poor carmaker. What (PSA CEO) Carlos Tavares continues to deliver is truly spectacular -- and he is not just a cost cutter. There is more differentiation between a Peugeot 208 and an Opel Corsa than between a Volkswagen and a Skoda. He is probably be the best auto manager worldwide, but he will have no time to lose once the merger with Fiat Chrysler is approved. Every quarter FCA’s earnings seem to get worse, it loses market share and its products are less competitive.