The European car market has undergone significant changes in the past two decades, with the rise of Tesla and the entry of Chinese brands. Europe, being a highly competitive market with strict safety and emissions standards, has seen shifts in the dominance of traditional car manufacturers.
Europe is the third largest automotive market in the world, after China and the United States, and it ranks second in terms of electric vehicle adoption. However, when it comes to the past 20 years, some car brands have fared better than others.
Big Brands Shrinking?
Between 2003 and 2023, the European automotive market witnessed a significant shift in brand dominance. Traditionally, Europe has been led by seven major automakers: Fiat from Italy, Citroen, Peugeot, and Renault from France, Volkswagen and Opel from Germany, and Ford from the UK.
In 2003, these seven brands (including Opel with Vauxhall) held almost 58 percent of new car registrations in Europe across 29 markets. Due to their strong presence in their respective home markets, they maintained a relatively strong position compared to Japanese and Korean brands.
For instance, Opel had a market share of 10 percent in Germany, while Renault had 27 percent in France. Although these figures were lower compared to the 1990s, they were still satisfactory because Korean brands had not yet made significant progress, and Japanese brands were trying to win over European consumers.
And Then Came SUVs
The dynamics started to shift with the popularity of SUVs, which began with the launch of the first-generation Nissan Qashqai. Additionally, Hyundai and Kia established manufacturing plants in the Czech Republic and Slovakia, producing competitive cars that appealed to local consumers.
As a result, in 2013, the Big-7 brands accounted for nearly 49 percent of the European car market, a decrease of 9 percentage points compared to a decade earlier. Between 2003 and 2013, six of these brands saw a decline in market share, ranging from a 0.9-point decrease for Fiat to a 4-point decrease for Renault. The exception was Volkswagen, which increased its market share from 9.8 percent in 2003 to 12.6 percent in 2013.
Who Came Out on Top?
In addition to Volkswagen’s slight gain in market share, the biggest winners over the past 20 years have been German premium brands, Toyota, Hyundai, Kia, and most recently, Tesla. These brands possess a greater level of flexibility compared to their European counterparts.
This allows them to introduce fresh products faster, catering to the evolving needs of consumers. Moreover, they were less affected by the European crisis between 2011 and 2014, and their strong global presence enabled them to save costs.
Will other struggling brands learn from their success?
The author of the article, Felipe Munoz, is an Automotive Industry Specialist at JATO Dynamics.