European Car Registrations Rise on Month, Fall Year-on-Year

European vehicle registrations fell by 6% in September, partly unwinding a drop of 9.7% logged in August. Registrations continued to be in a weak patch, falling at a 27% annual rate over three months and acceleration from a 2.9% rate of decline over six months. Over 12 months sales are lower, falling at a 7.7% annual rate. The problem is not just weakness in the month because the data on the three-month moving average show a decline and have fallen for several months in a row; based on three-month moving averages, the three-month 6-month and 12-month moving averages show declines at double-digit rates. Registrations are weak in Europe.

By country, registrations rose in the five countries that report sales: Germany, France, Italy, Spain, and the United Kingdom. Gain to the sharpest in Spain at 14.5% gains were weakest in the U.K. at 3%. Except for the U.K., all these reporting countries showed declines in registrations for two months in a row; the U.K. posted an increase in registrations in July.

Germany shows the weakest progression for registrations among the individual countries although on a year-over-year basis the weakest sales are in France where they fall 12.3%, in Italy where they fall 11%, compared to Germany where registrations year-over-year fall by only 6.7%. The U.K. has registrations up by 0.5% over 12 months while Spain has registrations up by 6.2%.

The progression of sales from 12-months to six-months to three-months shows growth rates in Germany escalating negatively from -6.7% over 12 months to a -20.2% pace over six months to a -56.9% annual rate over three months. This extreme weakness is challenged to some extent by Italy where there's an 11% drop over 12 months, a 3.5% drop, at an annual rate, over six months, and a three-month drop of 38.8% annualized. France shows consistent negative numbers across these horizons, falling by 12.3% over 12 months, a 19.1% annual rate drop over six months and a 14.2% annual rate drop over three months. Spain’s 6.2% year-over-year gain becomes a 17.6% annual rate drop over six months but then recovers to a 17.3% annual rate increase over three months. Spain's data are more volatile than they are weak. The U.K. is the only country to show increases on all horizons; it's showing accelerating increases with a gain of 0.5% over 12 months, progressing to a 2.6% annual rate rise over six months and elevating to an 18.5% annual rate over three months.

The United Kingdom is the only country that has a true positive story to tell. Spain has a story of some volatility with an increase over three months. The other countries have these isolated gains in September that are part of negative progressions. In Europe, conditions are weak; the auto sales data tell us they continue to be weak and there's no evidence that broadly tells us that things are getting better. In fact, the overview seems to be that conditions continue to be quite weak and might be getting worse. European car registration data today are not reassuring.