Short- and medium-term car registration forecasting based on selected macro and socio-economic indicators in European countries

Lubor Homolka, Vu Minh Ngo, Drahomíra Pavelková, Bach Tuan Le and Bruce Dehning

Research in Transportation Economics, 2020, vol. 80, issue C

Abstract: The automotive industry plays a key role in the European economy. In this paper, we determine which macro and socio-economic indicators have significant predictive power on car registrations - a proxy to automotive sector performance - across European countries. Contrary to the current literature which mainly focuses on long-term forecasting, we built our models on the highly seasonal monthly data of a medium-term period to make short-term forecasts. Our approach utilises predictors identified by the literature review. Presented models are built on the Vector Autoregressive models and are accompanied by formal tests, such as the Granger causality test. We have found mixed evidence about the importance of selected predictors as no general patterns were identified. We have found that the most useful predictor is the total number of registrations from the strongest export partner and past registration figures in the analysed country. Car registrations are virtually inelastic to the change of public transportation costs, fuel prices and short-term interest rates offered to households in most of the analysed countries. We have received mixed results about household sentiment across countries. Countries with a higher level of GDP are more sensitive to the changes in unemployment.

Keywords: Car registrations; Seasonality; Forecasting; Macroeconomic indicators; Socio-economic indicators; Vector autoregression; Granger causality (search for similar items in EconPapers)
JEL-codes: E32 F44 L62 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0739885919302641
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:retrec:v:80:y:2020:i:c:s0739885919302641

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_2&version=01

DOI: 10.1016/j.retrec.2019.100752

Access Statistics for this article

Research in Transportation Economics is currently edited by M. Dresner

More articles in Research in Transportation Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().