Video Editor: Mohd Ibrahim
Video Producer: Ujjwal Agarwal
Automakers are rolling out new electric and hybrid models at the Geneva International Motor show as they get ready to meet tougher emissions requirements in Europe.
The show is taking place against a background of multiple challenges faced by the industry, from slowing sales in China, its biggest market, to potential disruptions from Brexit.
Last month Nissan announced that it cancelled plans to make its X-Trail SUV in the UK – a sharp blow to Brexit supporters, who had fought to have the model built in northern England.
The company said it had made the decision "for business reasons" and it comes amid falling sales of diesel vehicles in Europe. But Nissan added that "the continued uncertainty around the UK's future relationship with the EU is not helping companies like ours to plan for the future."
Jim Holder, the Editorial Director of Autocar, says Brexit casts a shadow over the luxury auto show.
“There is no question that the entire European car industry is waiting with baited breath to see what happens with Brexit. I think they fear most a hard exit - no deal for Britian means bad news for their car sales into Britain. I think the entire British car industry is also on tenterhooks, because they need to have some security. They need to know what is going to happen, so that car companies can invest in Britian. They will not invest until they have some certainty on they will realise that investment, so Brexit sis absolutely hanging over the Geneva motor show and all the car makers are waiting to see what will happen.”Jim Holder, Editorial Director, Autocar
Jaguar Land Rover In January said it will cut 4,500 jobs as the carmaker addresses slowing demand in China and growing uncertainty about the UK's departure from the European Union.
The luxury carmaker, which launched its I-Pace pure electric car at the 2018 Geneva International Motor Show, will not be attending the this year's Swiss motorshow.
“It is hard to believe that just really 18-24 months ago Jaguar Land Rover appeared to be booming, but particularly the slump in diesel demand and the slump in Chinese sales has hit them incredibly hard and it has turned what were good profits into record losses.”Jim Holder, Editorial Director, Autocar
The traditional automotive industry is being challenged by the looming disruption from new technologies such as autonomous driving and smartphone-based services that offer use of a car without ownership, as well as regulatory pressure to add more zero local emissions vehicles.
“They are cutting like crazy in order to be able to preserve the money that they need to invest in future technologies and one of those cuts is their attendance at the Geneva Motor Show. This is a car company that is relatively small compared to its premium rivals from Germany for instance. It doesn’t have the funds to just bend its way through these current crises, so it has to act now and it has to act hard and these cuts are running deep. And of course that is a concern for their future as well.”Jim Holder, Editorial Director, Autocar
The traditional automotive industry is being challenged by the looming disruption from new technologies such as autonomous driving and smartphone-based services that offer use of a car without ownership, as well as regulatory pressure to add more zero local emissions vehicles.
In both cases, automakers are sinking billions in investment into markets that don't yet bring big sales volumes.
One of the big themes of this year’s motor show will be electric cars.
Tough new limits on emissions of carbon dioxide, the main greenhouse gas blamed for global warming, in the European Union take effect from 2021, and get even tougher by 2030.
Carmakers originally bet on diesel to help them meet reduced average fleet emissions.
But diesel sales have plummeted in the wake of Volkswagen's 2015 scandal over cars with software that let them cheat on diesel emissions tests.
Analysts say that more electric sales will have to fill the gap.
Yet that raises its own questions, not least consumer reluctance to buy electrics due to concerns about limited range and lack of places to charge.
“I think 2019 really is the year of the electrified car. I think a lot of car makers have held off because these cars are less profitable they cost hundreds of millions of pounds in development in order to create them and they haven’t wanted to do that until the public demand is there.”Jim Holder, Editorial Director, Autocar
Troubles in the global economy are hanging over the show.
China car sales dipped last year, and there is uncertainty about the outcome of US-China trade talks.
World markets were lifted Friday (1 March 2019) by suggestions that the US could endorse a trade deal with China in the coming weeks.
Failure to reach a deal could see President Donald Trump adding new import taxes that could slow the Chinese economy and global trade.
Trump has also threatened to impose import duties on autos that could hit European producers hard.
Britain could wind up leaving the European Union without a negotiated deal to smooth the transition, leading to sudden imposition of tariffs that could disrupt the auto industries' complex supply chains.
The economic troubles facing the world's largest economies will stop luxury auto makers from producing their high end cars, and it won't stop wealthy car enthusiast from buying them.
“It is fascinating that at the Geneva motor show we known McLaren has a secret new launch coming, we know Morgan the famous British sports car maker is producing a new model. We see Ginetta produce a Ferrari rival at around half a million dollars - these top end car makers are still coming out - they are producing new models and they will sell them and of course the old saying that the rich just keep getting richer and the, it still rings true. Whatever the world’s problems there is always a group of very rich people getting richer and willing to spend it on cars.”Jim Holder, Editorial Director, Autocar
Geneva tends to be a place for high-end automakers such as McLaren, Ferrari, Lamborghini and Aston Martin to show off gorgeous rides with prices starting at thousands of euros, pounds or dollars and heading up from there. This year will is no exception.
Despite the push for lower emissions, automakers can't resist the SUV and its relatives, called crossovers, because they sell well and can earn strong profit margins.
Automakers also haven't forgotten small gasoline-powered cars, which remain a leading sales category, especially in Europe's crowded cities where parking can be a hassle. Renault has a new version of its Clio and Peugeot offers a second-generation version of its 208.
The Geneva International Motor Show, held at the Palexpo Center, will open to journalists on from the 4th of March. It opens to the public from Thursday through 17 March.
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