PwC: RO carmakers’ reliance on foreign market makes them vulnerable

A vulnerability of Romania's automobile industry in this period is its dependence on exports, which are recovering with great difficulty, according to an article written by Daniel Anghel, PwC Romania partner, and leader of services for the automotive industry.

Exports of cars and car parts account for 46.6% of Romania's total exports, and, in the first six months of the year, they recorded a drop of over 20%, he argues, quoted by Economica.net.

The new car sales in Romania contracted by over 34% in the first seven months of 2020, compared to the similar period last year.

The report suggests that the Government supporting the replacement of old cars used in Romania, particularly with electric and hybrid models, would "be a big plus" (supposedly "help local industry," in the context of the report).

However, there is no electric model produced in Romania, only a mild-hybrid model sold by Ford (Puma).

PwC experts estimate that the sales on the European market will drop by between 20.8% and 38.5% this year, depending on the coronavirus pandemic's intensity in the second half of the year.

The production could decrease by between 10.7% and 32.6% - slower than the drop in the domestic sales - meaning that non-European markets could perform better.

(Photo courtesy of Dacia)