Chinese market becomes "most important pillar" for German carmakers in Q2: Ernst & Young


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BERLIN, Sept. 9 (Xinhua) -- Three major German carmakers of Volkswagen, BMW and Daimler had reported more sales in China with a year-on-year increase of five percent in the second quarter (Q2) of 2020, according to a study published by global consulting firm Ernst & Young (EY) on Wednesday.

The Chinese market developed into the "most important pillar" of the German automotive industry, as well as the global auto industry, in the second quarter, EY noted.

"All three German automotive groups were able to grow in China in the second quarter, while sales in the other regions slumped massively," said Constantin Gall, head of automotive and transportation at EY. As a result, China's share of global sales by German carmakers climbed from 33 percent to 51 percent.

In contrast, overall sales of German car manufacturers declined by 32 percent in Q2, according to the quarterly EY study which analyzed key financial figures of 17 automotive groups.

At the same time, all car manufacturing companies recorded a 39-percent drop in global sales, EY noted. French manufacturers, which were hardly active in China, even posted a 51-percent drop in sales.

"Never before has the Chinese market been so important for the automotive industry as it has been during these months," said Peter Fuss, partner at EY.

Due to the COVID-19 crisis, the 17 automotive groups reported a total operating loss of 10.8 billion euros (12.7 billion U.S. dollars) in Q2, after an operating profit of 21.8 billion euros in the same period last year, the EY study found.

In Germany, restrictions and the temporary shutdown saw the production of German car manufacturers almost come to a complete standstill for around five weeks in April and May.

"Never before has there been such a slump in turnover, profit and sales," said Gall. "The pandemic has brought the global automotive industry almost to a standstill at times -- with correspondingly catastrophic consequences for turnover and profit development."