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Viewing report
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Czech Republic Autos Report Q4 2011
Business Monitor International, Sep 2011, Pages: 49
With passenger car sales in the first seven months of this year reaching 100,402 units, down 0.01% from the same period last year, BMI has lowered its forecast for passenger car sales growth from 2.8% to 1.5% y-o-y, in 2011. We still believe positive growth is achievable based on buying patterns in previous years, when sales in the latter months of the year have rebounded from a slower summer period. We have also lowered our light commercial vehicle forecast to growth of 2%, owing to the private usage nature of some of the vehicles included in the segment, which will also be hit by weaker private consumption.
On the other hand, the heavier truck market is already outpacing our expectations in 2011 and we have raised our sales forecast to 35% growth. We do not expect this level of growth to be sustainable over the five-year forecast period, however, as the truck market is currently at a low base following a contraction of more than 50% in 2009. Although we see a significant improvement in consumer demand from 2012, we do not anticipate a complete recovery in sales to pre-crisis levels until 2013.
Although austerity measures are weighing heavy on new vehicle sales in many European countries, it is providing growth opportunities for the second-hand segment. Czech used car dealer AAA Auto is looking to move into the Russian used car market by September this year with the view to tapping into the country's rapidly growing vehicle ownership rate. After expanding in the key eastern European markets of the Czech Republic, Slovakia and Hungary, Russia comes as an obvious choice for AAA, given the size of its autos market and the relatively low vehicle ownership rate.
Despite the tough conditions for the new car market, however, Škoda Auto reported record revenue and operating profit in H111. Revenue increased 25.7% year-on-year (y-o-y), to EUR5.36bn (US$7.61bn), while operating profit was up 81.5% y-o-y, to EUR412mn (US$585mn). Škoda aims to strengthen its position in foreign markets and accelerate expansion of its range of vehicles to meet its target of annually selling at least 1.5mn vehicles until 2018, according to its chairman, Winfried Vahland.
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