European Car Sales Fall 8.7% to Record Low

New-car registrations, a proxy for sales, fell 8.7 percent from January 2012, the European Automobile Manufacturers’ Association reported in Brussels, falling to 885,159 units, the lowest level since the organization records began in 1990.

Global automakers are hoping for a decent 2013, but they worry that the European market will continue to decline. Consumers have been slammed by recession, unemployment and government austerity measures. In many countries with good public transportation, driving is a pleasure rather than a necessity, and high joblessness among young people has the industry fretting that an entire generation will not adopt the car lifestyle.

Carlos Ghosn, Renault’s chairman and chief executive, has estimated that European car sales will fall at least 3 percent this year. The car and light vehicle market contracted 8.2 percent in 2012 to just more than 12 million units, the lowest level since 1995.

The United States, in comparison, has gotten off to a fairly strong start this year, with sales having gained 14 percent in January from the same month in 2012. Emerging markets are also expected to post good growth.

In Europe, the biggest decline in January was posted by Ford Motor, where sales fell 25.5 percent. Ford said last month that its annual loss in Europe — its second-biggest market after North America — could climb to as much as $2 billion this year.

Volkswagen, the largest European automaker, posted a 5.2 percent decline in January. The European sales of PSA Peugeot Citroën, the troubled French company that ranks No. 2 in the European Union, fell 16.3 percent, while its rival Renault dropped 5.6 percent, and Renault’s Japanese alliance partner, Nissan, dropped 6 percent. General Motors’ sales fell 5.5 percent. Toyota Motors’ sales fell 16.8 percent.

The luxury automakers continued to gain in January, for the most part, with Daimler, the maker of Mercedes-Benz, adding 3.7 percent from 2012 and BMW adding 6.6 percent. Jaguar Land Rover sales rose 19 percent. The data include all 27 E.U. countries except Malta. Only Britain, where sales rose 11.5 percent from 2012, bucked the tide in major markets.

Germany, the biggest European market and long one of the healthiest, turned decisively lower, with sales falling 8.6 percent. French sales declined 15.1 percent, and Spanish sales slumped 9.6 percent. Even larger declines were seen in the Netherlands, down 31.2 percent; Greece, down 34.5 percent; and Finland, down 28 percent.

Article source: http://www.nytimes.com/2013/02/20/business/global/european-car-sales-fall-8-7-to-record-low.html?partner=rss&emc=rss