New car sales in Spain exceeded one million in 2024 for the first time since the COVID-19 pandemic, according to data released on Thursday. This marks a significant rebound; however, industry analysts and sources caution against viewing it as a definitive sign of recovery. The sector faces headwinds in 2025.
Changing consumer preferences, high vehicle prices, uncertainties surrounding electric vehicles (EVs), and increasing competition from Chinese automakers will all create difficulties for the Spanish automotive industry, noted Felipe Munoz, an analyst at JATO Dynamics, a market research firm.
In 2019, new car sales in Spain topped 1.3 million. Then sales slumped to around 900,000 annually for the following four years. While the 1.02 million vehicles sold in 2024 represent a 7.1% increase year-on-year, they are still well below the pre-pandemic figures, Reuters reported. Last year’s rise was amplified by a substantial 28.8% surge in December sales.
Munoz suggested that the recent uptick appears transient. He noted that new car sales never fully recovered after the pandemic negatively impacted demand. “I don’t think (the Spanish car market) will ever hit those numbers again,” he stated.
European car manufacturers, focusing on increasing profit margins, raised prices following the semiconductor shortage – accepting lower sales volumes in the process, according to Munoz. This strategy proved successful until this year, as Chinese brands began to gain more traction in the European market, forcing traditional manufacturers to recognize the impact of their comparatively high prices, he added.
While the Spanish car parts manufacturer Gestamp was less affected by the decline in car sales in Spain and Europe, owing to its geographic diversification, CFO Ignacio Mosquera emphasized the need for more decisive action to support a struggling sector lacking a clear policy for “one of the most important industry overhauls in history.”
“If there’s no public-private partnership, there’s uncertainty in demand and people don’t know which vehicle to buy. Faced with that decision, what do they do? They extend the life of their vehicle,” Mosquera explained, which subsequently reduces new car sales.
Jose Portilla, the head of Spanish car part manufacturers’ association Sernauto, echoed this sentiment, arguing for more state support to encourage EV sales. “If we’re able to boost the recharging infrastructure, EVs become more affordable, and the subsidies are given at the time of purchase instead of one-and-a-half or two years later. This will encourage the market much more and we’ll be able to redirect this situation,” Portilla added.
