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European auto sales decline
February 20, 2013
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PARIS: European Union car sales fell to the lowest level for a January, with Ford Motor Co. and PSA Peugeot Citroen posting the biggest drops, as economic contractions in the southern part of the region widened to Germany and France.

Registrations in January dropped 8.7 per cent to 885,159 vehicles from 969,219 cars a year earlier, the Brussels-based European Automobile Manufacturers’ Association, or ACEA, said on Tuesday in a statement. The figure was the lowest for the month since the group began tracking sales in 1990, it said. Europewide sales, also including Switzerland, Iceland and Norway, fell 8.5 per cent from a year earlier to 918,280 cars.

Volume carmakers are struggling to end losses in Europe that Fiat Chief Executive Officer Sergio Marchionne has estimated at a combined 5 billion euros ($6.68 billion) in 2012. Manufacturers in the region have announced 30,000 job cuts and five plant shutdowns since July, with Renault and Paris-based Peugeot outlining domestic workforce reductions of 17 per cent. The economies of Germany and France, the two biggest among the 17 nations sharing the euro, shrank in the fourth quarter.

“The sales crisis has spread from southern countries to the rest of Europe, and no one is immune,” Gian Primo Quagliano, president of Promotor automotive research group in Bologna, Italy, said before the ACEA released figures. “Until confidence rises, we won’t have any inversion in the trend.”

Industrywide auto sales in the EU fell to a 17-year low in 2012. Deliveries are likely to drop for a sixth consecutive year in 2013, according to IHS Automotive research company. The euro zone entered a recession in the third quarter.

German car sales in January fell 8.6 per cent, the ACEA said today. Registrations dropped 15 per cent in France and 18 per cent in Italy. Car sales in the UK, which overtook France last year to become Europe’s second-biggest auto market, rose 11 per cent.

“Germany was a market that was pretty resilient hitherto,” David Arnold, a sales specialist at Credit Suisse in London, said before the ACEA published the numbers. “Falling sales levels in 2013 will put further pressure on all players.”

Ford estimates that its loss in Europe will widen to $2 billion this year from $1.5 billion in 2012. The Dearborn, Michigan-based manufacturer is shutting vehicle and component plants in the UK and Belgium by the end of 2014 and eliminating 6,200 jobs, or 13 per cent of its workforce, in Europe in response to the auto-market decline. Ford’s Europewide sales fell 26 per cent to 61,544 vehicles last month.

Peugeot’s European registrations dropped 16 per cent to 104,291 cars. The carmaker, the region’s second-largest, said on Feb.13 that it’s planning an upmarket shift of its main brand, and pledged to cut its cash-consumption rate 50 per cent this year after burning through 3 billion euros in 2012.

Volkswagen AG, Europe’s biggest carmaker, posted a 5.5 per cent drop in sales in the region last month, the ACEA said. Renault SA, based in the Paris suburb of Boulogne-Billancourt, reported a 6.1 per cent decline. Renault will eliminate 7,500 jobs in France through 2016, including 5,700 posts that will disappear when people retire or quit and aren’t replaced.


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