European car manufacturers face a serious problem. Just like the dark period experienced by economies, which are now recovering, it is the automotive sector's turn to feel the pinch, with five brands admitting difficulties in meeting proposed targets for the full year.

The French group Stellantis and the British Aston Martin were the last to update the numbers, similar to Mercedes-Benz, BMW and Volkswagen. The new data is not encouraging.

The drop in profit and revenue forecasts comes at a time when European manufacturers are under pressure due to weak demand in China, whose economy has been receiving stimulus in recent weeks. Although the trade war between Beijing and the European Union has calmed down, tension is rising at a time when the European Union is preparing to finalize customs duties on imports of cars produced in China.

Auto giants rely on the Chinese economy for their sales, influenced now by the current state of the economy, but also by fierce competition in the electricity market. BYD and Xpeng are among the brands that will undergo price changes in Europe, but will continue to generate sales in the domestic market.

Proof of this is the free fall that all brands felt in their own negotiations on the European stock exchanges. Mercedes shares, the first to reveal the forecast cut, fell by 2.44% on the German stock market to 58.04 euros, causing its capitalization to fall by 1.27 billion euros between Friday and Monday.

BMW was no exception to this “sweep”, falling by 2.42% to 79.18 euros in Monday’s session. On the last business day of last week, the manufacturer of… Beamer It closed at 81.14 euros, the highest value since September 4. Between Friday and Monday, the German brand lost 2.7 billion euros in market value.

Volkswagen lowered its forecasts for the second time in less than three months and warned of weaker results than expected at the beginning of the year. The manufacturer now reports revenues of around 2 billion euros, less than half of the 4.5 billion expected at the start of the year.

The manufacturer that gives its name to the Wolfsburg Group closed its shares on Friday at 97.12 euros, the highest value since September 3, but the news over the weekend was not in its favor and it opened on Monday with a loss. The securities reached 95.16 euros, resulting in a market value of 57 billion dollars, a decrease of 1.29 billion compared to 58.29 billion recorded the previous business day.

Porsche, which is controlled by Volkswagen, although not swayed by lowering its year-end forecasts, is suffering the consequences of the group. The sports car brand lost 1.75 billion euros in just two business days.

Compared to Stellantis, these are minor drops. The shares of the manufacturer, run by Portuguese Carlos Tavares, fell by 13.01% in one session, and its shares now stand at 13.97 euros, far from the 29.40 euros they reached at the end of March. In last Monday's session, Stellantis' capitalization fell to 40.85 billion euros, showing a significant loss of 6.12 billion since September 27, when it reached 46.97 billion.

The former PSA, owner of brands such as Citroën, Fiat and Peugeot, now expects an operating margin of between 5.5% and 7%, values ​​that are lower than the previous double-digit perspective.

But the British luxury company suffered the most in the chaos. Aston Martins lost a staggering 24.51%, with shares valued at £120.40, and a market capitalization of £1.01bn.

Sales decline in Europe

But it is not only the market in China that is putting pressure on car giants in Europe, with European demand also declining.

The latest data shows a sharp 18.3% decline in new car sales in August alone, year-on-year, pushing these sales to the weakest level in the past three years. It is not surprising that the markets most affected were: Germany, France and Italy.

In addition to the burnout, supposedly with the death announcement, the sale of electric cars also fell in August. These sales showed a decline for the fourth month in August by 43.9%, falling to less than 100 thousand cars. In August, this type of car represented 14.4% of the European market.

However, the Association of European Automobile Manufacturers reports that since the beginning of 2024, sales have risen slightly (+1.4%), driven by the Italian and Spanish markets, where 7.2 million cars were sold.

Portugal is no exception to the rule

Although the data is not encouraging, it is impossible to deny the number of new cars rolling on Portuguese roads. Let's go to September and records are already in the second letter of the alphabet, and approaching the third.

In August alone, new car sales fell by 8.7%, with 14,338 cars entering circulation on national roads, according to data from the Portuguese Automobile Association.

Of these cars that entered circulation, 21% were electric, electric or hybrid (6,587). However, this is a decline of 5.2% year-on-year, and the interesting fact is that BMW has managed to outsell Tesla.

Now, in August 2023, there has been a 17.7% increase, which is one of the best results in recent times.

However, between January and August, the market saw 4.4% growth compared to the same period in 2023, with 168,942 new cars changing hands. The passenger car category showed a decrease of 9.4%, while passenger cars increased by 2.5%.