Warning: count(): Parameter must be an array or an object that implements Countable in /home/bloodyca/public_html/wp-includes/post-template.php on line 284

Europe’s new-car sales rise 6% on price cuts

Car sales in Europe rose 6 percent in September, helped by automakers’ price cuts and strong demand in the region’s top markets of Germany, the UK and France.

New passenger-car registrations in the EU and the countries of the European Free Trade Area (EFTA) increased to 1.27 million vehicles last month, industry association ACEA said today in a statement.

September sales benefited from an extra selling day compared with 2013. Monthly growth was the strongest since March, helping to lift nine-month sales by 6 percent to 9.91 million cars.

Europe’s auto market has posted growth for 13 straight months. But the fragile recovery is still threatened by weak confidence and geopolitical uncertainties in Russia and elsewhere.

ISI Group’s automotive research head, Arndt Ellinghorst, urged caution, saying September’s growth was a more modest 1.3 percent when adjusted for an extra selling day.

Carlos Da Silva, manager for European light vehicle sales forecast at IHS Automotive, said September sales were helped by the number plate change in the UK and an end-of-quarter push by dealers and automakers.

Sales are being supported by high levels of direct and indirect incentives and even models that have a buzz around them such as the Renault Captur are being bolstered by special editions, he said.

The need to replace aging cars is another factor, he said, which explains why growth is slow. “So far fleet renewal is mostly supported by ‘need’ not by ‘want,’ Da Silva said.

Frank Biller, an analyst at LBBW in Stuttgart, Germany, said. “Everyone knows that the economic recovery on the whole is looking quite shaky, which means rising prices aren’t very likely, so consumers are holding back, which is keeping a lid on the European car recovery.”

September sales in Germany, the region’s biggest market, gained 5 percent to 260,062 vehicles. Second-placed UK and No. 3 market France were each up 6 percent. Growth of nearly 30 percent or more in Spain, Portugal and Greece, countries formerly hit by austerity, stoked demand for volume brands.

Volkswagen, Europe’s biggest carmaker, sold 6 percent more autos in the region, with the namesake VW brand boosting deliveries 7.5 percent and the luxury marque Audi reporting a 3 percent gain. Skoda sales grew by 3 percent while Seat’s volume was up 15 percent.

Sales at PSA/Peugeot-Citroen, the second-biggest carmaker, gained 10 percent last month. No. 3 Renault also saw sales climb 10 percent, propelled by Dacia’s 20 percent growth and a 7.5 increase at Renault brand.

Ford’s registrations were up 6.5 percent while General Motors’ Opel/Vauxhall unit saw 6 percent growth, helped by the Mokka compact sport-utility vehicle and Corsa subcompact.

Fiat’s group sales were up 6 percent with the core Fiat’s brand’s volume growing by 4 percent, Chrysler/Lancia sales up 13 percent and Jeep up 61 percent, while Alfa Romeo’s registrations fell by 13 percent.

The main BMW brand’s sales dropped by 2 percent in September, while competitor Daimler’s Mercedes-Benz nameplate posted a 9 percent increase.

Nissan moved closer to its aim of toppling Toyota as Europe’s top-selling Asian brand with September sales up 16 percent to 51,283 vehicles compared with Toyota brand’s 1 percent volume increase to 52,146. Nissan is benefiting from the launches of new generations of its Qashaqai, Note and X-Trail models.

Momentum is expected to slow in the remainder of the year and the possible return to recession in the euro zone poses a risk for demand in 2015, said Jonathon Poskitt, head of European forecasting for LMC Automotive.

LMC earlier this month trimmed its full-year forecast for sales gains in Western Europe to 4.6 percent or 12.7 million vehicles. Volume growth may slow further in 2015 to 3.3 percent or 12.5 million, Poskitt said.

Automakers are offering incentives to attract reluctant buyers into showrooms. German dealer rebates averaged 11.8 percent off the sticker price in September, unchanged from August, to remain at the highest levels this year, according to the data published by PulsSchlag. Ford’s price incentives were at 11.7 percent, while French brands topped the charts at 13.9 percent.

Audi cars were available from German dealers with average discounts of 11.5 percent, compared with 8.4 percent a year ago, while the VW brand’s rebates rose to 10.7 percent from 10.3 percent, according to PulsSchlag.

Europe’s flagging economic recovery prompted car industry executives at the Paris Motor Show earlier this month to support calls for more stimulus measures from the European Central Bank. Renault Chief Executive Officer Carlos Ghosn said he’d welcome ECB President Mario Draghi continuing to intervene in markets.

Since then, the economic outlook has soured further, with Europe leading a market drop that has wiped almost $5 trillion from equity values worldwide. Investors became more doubtful after a press conference on Oct. 2, when Draghi stopped short of specifying how many assets the ECB might buy to counter deflation.