Bloomberg: EU auto industry faces weak demand, braces for recession
The European auto sector has not yet reached a point of sustainable recovery, the publication reported Bloomberg.
Investors have been predicting a bleak outlook for this segment of the economy, but the reality is gradually turning out to be even worse than expected. It has been a tough year, and the much-promised recovery from the pandemic is long gone.
The market is currently experiencing the culmination of a structural shift, with internal challenges and the prospect of a cyclical downturn, according to Wolf von Rothberg, equity strategist at Bank J Safra Sarasin. The industry is struggling with weak demand, particularly in the key Chinese market, and also faces stiff competition in the electric vehicle market from manufacturers in the Asian country.
The problem is exacerbated by the trade conflict between China and the European Union.
Earlier, it was reported that the threat of car plant closures has increased in the European Union. Almost 30 percent of the main passenger car plants are underutilized. In addition, annual car sales in Europe are three million below pre-pandemic levels.
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