This report covers market developments in 2013 for Poland’s automotive sector. The report also summarizes corporate news for firms including Fiat Auto Poland, Goodyear, Volkswagen, and GM, among others.

The Polish automotive sector continued to be negatively affected by shrinking external and domestic demand in 2013, yet overall the situation remained stable in all segments of the market. The production of motor vehicles declined for the sixth consecutive year in 2013 and reached its lowest level since 2004, when Poland joined the EU. Nonetheless, the contraction has visibly moderated to minus 8.1% year on year last year from the 23.3% year on year drop recorded in 2012. The annual overall decline in production was driven by the diminishing passenger car output, while in the commercial vehicle segment the situation improved year on year. The decline of motor vehicle output in the past years was driven by shrinking external demand, as most of the automobile production in Poland (nearly 99% in the case of LCVs) is earmarked for exports, particularly to Western European markets.

The car parts segments maintained positive performance in 2013. The value of sold production reported by car part manufacturers increased by nearly 10% year on year last year, accelerating from the 2.7% year on year rise in 2012, market data show. The car parts and accessories segment accounted for 55.3% of the automotive sold production value from January to September 2013, compared to 53.8% in full-year 2012. Furthermore, the year on year higher exports of cart parts and accessories drove the overall automotive external deliveries upwards on an annual basis in 2013, after the decline recorded in 2012.

The Polish car market continued to perform above the EU average. (In 2013, the EU car market recorded a 1.7% year on year decrease to 11.8mn units, the sixth consecutive year of decline.) The number of new registrations will likely continue rising in 2014, propped up by the improving macroeconomic environment and branch developments. Demand is expected to rise visibly in the first months of 2014, encouraged by the derogation window that allows the purchase of passenger cars with full VAT subtractions for corporations.

Key Points:

• In corporate news, car manufacturer Fiat Auto Poland reported a 15% year on year decline in production in its Tychy plant in 2013, on the back of the discontinuation of the production of Fiat Panda model in Poland.

• US-based tire group Goodyear acquired a 4.99% stake in Polish tire maker Debica SA from PZU FIZ Aktywow Niepublicznych Bis, thus increasing its share in the company to nearly 81.4%.

• German carmaker Volkswagen is reportedly considering building a new plant in Poland to assemble the Crafter large delivery van.

• General Motors will invest EUR 250mn in a project aimed at producing four-cylinder engines in its Tychy plant.

• The number of new passenger cars registered in 2013 increased by 6.3% year on year, returning to the positive area for the first time in the past three years.