PwC Hungary has prepared a survey report of the Hungarian automotive industry for the second time. Respondents to this year’s survey mainly included domestic car dealers operating in Budapest and its vicinity, and in towns and cities with between 10 and 100 thousand inhabitants. Most of the car dealers surveyed have been in the business for ten to fifteen years and are engaged in multi-brand distribution.
The majority (88%) of dealers sold fewer cars in 2009 compared to the previous year, and only 9% reported an increase in sales volume. Most respondents (86%) cited the fall in customer demand that resulted from the financial crisis as the main reason for the decline in domestic sales. Profits continued to fall in 2009, as 61% of respondents experienced a decline in profit margins.
Hungarian car dealers are struggling for survival, and there is little hope for improvement in the short term. The number of customers has dwindled, and those that remain tend to favour cars in the budget and mainstream categories. Because of the recent tightening of lending conditions, cars are now usually paid for with cash.