By Jerom Bolt
The frequent information that Romania's economic growth is based on consumption only turns out to be singular. They become even marginal as economic growth strengthens.
This shows a study released today, quoted by Agerpres.
Thus, the automotive industry is one of the main pillars of the Romanian economy, employing over 150,000 people and having contributed 47 percent of the country's exports in 2016.
From one year to another, the automotive industry enjoys strong profitability. In 2016, it recorded an impressive growth rate, 9 percent over 2015, against global averages of 1.6 percent. At this rate, we can expect annual increases of 6-7 percent 2020.
The sector has so far been driven by automakers, with Dacia-Renault ranked 11th in Europe, with nearly 360,000 units in 2016, according to data provided by Euler Hermes, the study's author. Currently, most of the growth comes from the makers of automotive parts and components.
Major players on the market are not transparent about estimates and financial data, and bank financing is usually provided at group level under favorable conditions when compared with the domestic ones.
As far as the development of the domestic market is concerned, the automotive industry appreciated in Q4 2016 for new automobiles (-1.7 percent in Q1-Q2 to 32.500 units), but plummeted due to a slowdown in used cars sales, just 101,500 units (-15.2 percent from Q1-Q2).
The year 2016 was one of the best in the last decade, with a 17.4 percent increase in the number of motor vehicle registrations to 510,000 units, of which about 22 percent (115,000 units) were new automobiles.
The financial leasing market increased by 25 percent in 2016 to two billion euros, of which almost 77 percent were automobiles and light commercial vehicles. Companies accounted for 97 percent of the total financial leasing customers, followed by individuals (2 percent), and the public sector by (1 percent). The fleet of operational leasing cars increased by 8 percent to 60,000 vehicles in 2016 (about 13 percent of all new car registrations), with similar growth expected for 2017.
The total turnover of the automotive sector in 2016 exceeded 20 billion euros, driven by exports, as the local market is relatively small and centred on used motor vehicles.
The main automotive companies operating in Romania are Dacia (turnover of 4.2 billion euros in 2015), Ford (0.8 billion euros), and the Volkswagen Group as only trader and distributor, with figures of 0.4 billion euros.