In the last couple of weeks, we’ve been blinded by the huge profits being enjoyed in the car industry.
JLR (mostly LR, admittedly) is making unheard-of margins of 20 per cent, Daimler made record profits, Ferrari posted all-time high revenues and even General Motors – bankrupt a couple of years ago – made £4.8bn profit, despite dropping a hefty £358m loss in Europe.
But it’s GM’s European woes that should remind us that today’s car industry is split very starkly between those brands and companies on a roll and the rest. There seems to be no middle ground: either you are well-regarded brand, sales are increasing and you are banking cash, or you are middle-market plankton, sales are plunging and you are deep in the red.
The European new car market sales figures for January make the extent of this divergence starkly clear. Audi was up 6.3 per cent month-on-month, along with Mercedes (+7), Skoda (+9), Jeep (+53), Hyundai (+18), Kia (+31), Land Rover (+47).
Out-of favour Peugeot was down 16 per cent, along with Citroën (-13), Renault (-29), Opel/Vauxhall (-21), Fiat (-19), Honda (-24) and Mazda (-36).
OK, there were a few premium surprises (BMW fell 8.7 per cent, but that was probably caused by the switch-over to the new 3-series), but the figures certainly seem to show that the less fashionable half of the industry is in a nose dive from which it is unlikely to recover.