EY analyzed the financial performance of the world’s 16 largest automakers in the third quarter of 2019. Their combined revenue grew by 3% over this period to 419 billion euros. Disparities, however, must be emphasized.
Taken as a whole, the financial results of the 16 major global automakers in the third quarter of 2019 are encouraging. Their cumulative turnover was 419 billion euros, a total increase of 3% compared to the same period in 2018. EY, author of the analysis, points out that this is the most quarter of the sector for 10 years. Their profitability increased by 0.6 percentage points with an EBIT margin (earnings before interest and taxes) of 5.9%, the second highest quarter over the last 10 years.
This performance is surprising in more ways than one as builders are currently engaged in an electrification process requiring huge investments and are facing a slowing demand in most regions. A decrease in sales of around 2% has been identified by EY.
Jean-François Bélorgey , a partner at EY in charge of the automotive sector, confirms that these good figures are ” unexpected ” and that they contrast ” with the announcements and concerns of the moment, worries that are largely based, unfortunately”. He completes his statement by expressing his fear ” that this improvement is only one and that the sector has yet to face headwinds quite serious, even if some actors show quite impressive resilience and especially the most big of them “ .
Good performance of German builders
Another element, highlighted by the board’s audit specialist, is the dynamic disparity between builders. Among the 16 actors studied, 7 experienced an increase in their turnover, while 8 saw it decrease, only one remained at the same level. German manufacturers are doing well with a 9.3% increase in turnover. French manufacturers, on the other hand, posted a drop of 0.1%, the same for the Japanese (-0.5%) and the Americans (-1.2%). EY says that PSA and Renault are ranked in 11 th and 13 thpositions on the sole criterion of the CA. In terms of sales, the German brands are also the only ones in the world with a rise of 5%. At the same time, our domestic manufacturers saw their volumes decrease by 4%.
However, we must look further to find the player with the best ratios in the past quarter. Toyota is positioned in the top three of the panel on the four indicators monitored (sales, operating results, vehicle sales and EBIT margin). The Japanese manufacturer has the largest margin (8.7%), ahead of BMW (8.6%) and General Motors (7.7%). EY states that the pre-tax results of French manufacturers are not disclosed, the French regulations do not make the request.
The study finally reveals that 10 groups have seen their market capitalization increase over the previous year, among which PSA (+ 20%), Kia, Toyota, Volkswagen, Ford, General Motors, Honda, Fiat Chrysler, Daimler and Hyundai . ” Renault is the car manufacturer studied experiencing the largest decline, with 23% less capitalization, ” says EY.