Corona could slash German fleet registrations by 50% in 2020

The market won’t recover before late 2021, says Dataforce

In its latest forecast, Frankfurt-based vehicle market intelligence company Dataforce expects the German fleet market to shrink by 380,000 units in 2020. That’s about half of the 2019 registrations.

In today's press release, Dataforce says that over the next few weeks, the closures of registration offices and showrooms combined with the production stops in factories will have the greatest impact. “In many cases companies that have already ordered new cars are unable to register them. The resulting drop will amount to more than 80% of the volume we initially projected for April and May.”

However, the consequences extend beyond the lockdown period, Dataforce explains. “Closed dealerships correspond to a significant shortfall in new car orders today and this will lead to fewer registrations in the coming three to six months. Hence, even under the assumption that dealers will reopen in mid-May and factories will restart quickly, registration figures will continue to be dampened into October.”

In addition to these restrictions on the supply side, Dataforce also sees demand being affected both in the short and in the medium term. “Companies must take into consideration that their economic situation may deteriorate in the coming months. Accordingly, some investments that are not strictly necessary will be postponed until the situation becomes clearer. Once again taking into account the delay between car order and delivery date, the consequences of this uncertainty will be felt until early 2021.”

Outlook

For Germany, Dataforce is assuming a broad recovery by the end of 2021. "Until then, however, demand will be noticeably lower than in our original forecast at the beginning of the year. This is also due to special effects that affect the fleet market in particular, such as more difficult access to corporate loans and lower residual values when used company cars are resold."

The statement regarding residual values and used cars is seconded by Autorola, which believes leasing companies, fleet owners and dealers will be facing tough times throughout 2020.

Dataforce expects some of the demand shortfall to be made up for in the period 2021 to 2023, as a result of which Dataforce’s fleet market forecast for 2022 and 2023 rises slightly – despite the weaker economic expectations.