Growing Car Sales Igniting Italian Economic Recovery

Bruno Bounavoglia, an Eastern Rome Volkswagen dealer, has a strong feeling that there is change heading to the automotive world. Sixty year old Bounavoglia, of Valentino Automobili, sells on average around 130 vehicles per month, but has now exceeded his monthly sales average with January’s sales turning out at 150 vehicles.

Bounavoglia states “January didn’t go badly and February didn’t start terribly either, Ican’t really explain it, but there are some small signs of recovery.”

Throughout Italy, many dealers have noticed new car registrations increase significantly. According to the Transport ministry data, new car registrations inflated to 131,000 in January, which is a 10.9 percent increase as compared to the previous year. A few other economic signs indicating potential hope that the “eurozone’s third-largest economy will finally post growth in gross domestic product in 2015 after three years of recession.”

Chief economist at Confindustria, the largest Italian business lobby, Luca Paolazzi stated “A series of data over the past month have been comforting: this really should be the year of a shift in the cycle. Things are moving in the right direction.” The European Commission released a statement that Italy is “expected to generate growth of 0.6 percent in 2015.” By Global or even European standards, this growth rate is extremely slow, but this “could feel like a boom for Italy after the economy shrank by 0.5 percent last year and by 1.9 percent in 2013,” according to James Politi.

The Bank of Italy reported that over the weekend it “expects the economy to grow by 0.5 percent this year and above 1.5 percent in 2016,” according to James Politi, “The forecast is a U-turn on a prediction given only last month – before the launch of QE – that the economy would grow by 0.4 percent this year and 1.2 percent next year.”

A turn around like this could potentially positively impact the entire eurozone, which would be “likely to improve Italy’s public finances and diminish fears that Rome could face a new debt crisis.”

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One thought on “Growing Car Sales Igniting Italian Economic Recovery

  1. NB, I’m interested in your subject matter here, but I’m not sure you’ve teased out its significance. What’s going on with the auto market in Europe? What’s the trend line for autos over the past 10 years? Are sales up or down?

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