Challenges for Spain’s auto industry: Mobility model uncertainty and collapse in exports
Fecha: julio 2020
María José Moral
Automoción, Exportaciones, España, COVID-19
SEFO, Spanish and International Economic & Financial Outlook, V. 9 N.º 4
The Spanish automotive sector is a key part of the country’s industrial sector, accounting for 9% of GDP and nearly 8% of employment. Notably, export growth between 2013 to 2019 was equivalent to a constant annual rate of 2.6%, just shy of growth in Germany (2.9%) but ahead of Italy (2.4%) and France, where annual average growth in exports has been just 0.5%. However, export growth has been slowing, a concern given that historically eight out of every ten vehicles produced in Spain are exported. This slowdown in exports has also occurred in countries, such as Germany, Italy and France, leading to a deterioration of trade balances in the automotive sector. Unfortunately, the arrival of COVID-19 interrupted a recovery in car exports, leading to an annual export contraction of 87.9% in April. That said, there are longer-term challenges other than COVID-19 that threaten the future growth of the industry, including significant competition from abroad, slower growth in new car registrations in Europe, and uncertainty regarding the cleanest alternative technology for cars. The latter is of particular importance and will call for the design of transitional measures that address the reorganisation of the production of diesel cars, which, in any case, are less environmentally harmful than previous diesel models.