German car giants Volkswagen, BMW and Daimler have posted strong sales growth in the face of a contracting global market in 2019, shifting massive numbers of sport utility vehicles (SUVs) ahead of a pivotal year for electric mobility.
While ratings agency Fitch estimated global unit sales shrank four percent year-on-year, figures released in recent days showed BMW gaining two percent, Daimler’s Mercedes-Benz 1.3 percent, and the 12-brand VW group flagship brand 1.3.
But even with growing sales, carmakers plan over 40,000 jobs cuts in the coming years, with Opel the latest to announce 2,100 voluntary departures Tuesday.
In the fierce race to be worldwide number one in high-end cars, Daimler’s nose remained ahead for the fourth year in a row.
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The Stuttgarters shipped 2.34 million Mercedes-Benz, while Munich sold 2.17 million BMWs in all-time records postings for the automakers. Both premium manufacturers’ figures were massively boosted by China, with Mercedes sales there growing 6.2 percent and BMW 13.1 percent year-on-year.
“German manufacturers are well positioned with their premium brands,” said Ferdinand Dudenhoeffer, industry expert at the University of Duisburg-Essen.
But VW also highlighted strong performance in China “thanks to the strength of its brand. Electric cars have to hit the roads, otherwise the fines will land and they will be painful. More keenly touched by the US-China trade conflict were American manufacturers like Ford and General Motors, Dudenhoeffer said.
For all the German carmakers, 2019 brought new strides for the dominance of SUVs in sales figures. Sales of BMW’s “X” range grew 21 percent, now making up around half of total deliveries.
At Daimler, one in three Mercedes sold was an SUV at almost 784,000 units, while VW’s Seat and Porsche subsidiaries also shipped more of the models.
“It’s perfectly clear that SUVs drive sales and profits for the carmakers,” said Stefan Bratzel of the Center of Automotive Management.
But demand for the high-margin gas guzzlers will squeeze manufacturers as they scramble to reduce carbon dioxide (CO2) emissions in response to new EU rules.
From this year, automakers must reach average CO2 emissions across their new vehicle fleets of below 95 grammes per kilometre, on pain of harsh fines from 2021.
Looking to reduce their climate impact, manufacturers have dozens of electric and hybrid models lined up for release in the coming years.
In particular focus is Volkswagen’s “ID.3” compact car, presented to great fanfare at last September’s IAA trade show as the electric counterpart to the company’s stalwart Golf while BMW and Daimler are placing most of their chips on hybrids rather than all-electric power.
