BELGIUM: European car market slipped in April
Data released today by the European carmakers' trade association, ACEA, shows that the European new car market fell by 0.6% in April over the same month last year, in spite of an extra working day. It was the third consecutive monthly market decline.
ACEA said that the total European car market reached 1,291,634 units in April. Cumulative sales in the first four months stood at 5,529,285 units, 0.2% below the same period last year.
There was further market growth in Central Europe in April, continuing a long established trend in the new EU member states (it was the fourth consecutive month of growth).
Results across Western Europe were more mixed. The Italian and UK markets posted solid improvements in April. The Italian market was up by 9.6%, boosted by scrappage incentives while the UK market was boosted (up 4.3%) by supermini sales, ACEA said.
Analysts have cautioned that interest rate increases in the UK will dampen down car demand later this year.
The French and Spanish markets were down on year-ago levels (Spain -6% and France -5%).
The underperformance of the German market due to this year's VAT increase was still evident, but analysts say the market distortion caused is becoming less significant. The German market was down 7% in April.
JD Power Automotive Forecasting analyst Jonathan Poskitt told just-auto that the outlook for sales in Western Europe over the balance of the year is reasonably positive.
"We're forecasting a west European market up 1% in 2007 at 14.9m units. A number of specific factors need to be considered in looking at prospects for the balance of the year," Poskitt said.
"In Germany, the payback effect caused by the VAT change in Germany is starting to unwind now and the sales rate is improving.
"And in Italy, the market will continue to be inflated by the scrappage incentive that stays in place until the end of the year - also likely to pull forward some sales in the final quarter that would otherwise have taken place in 2008."
However, Poskitt cautioned that in the UK market interest rate rises won't help car sales in the near term, with the next year or so likely to see the market flat before the economy picks up again in the second half of 2008.
At the manufacturer level, April declines were largest at Renault (-10.5%) and GM (-4.7%). Renault is being hurt in particular by the declines in the French and Spanish markets as well as a new product vacuum ahead of the imminent rollout of the new Twingo and, later this year, new Laguna.
The scrappage incentive inspired surge in the Italian market has clearly aided Fiat. The resurgent company's April sales in Europe were 8% ahead of last year's level.
Ford continued to show a positive trend in Europe with April sales for Ford Group some 2.4% ahead of last year (within that, the Ford brand was 1.8% up). There was a 9.1% gain for Volvo in April, boosted by the market impact of its new C30 model.
See also: FRANCE: Renault revenue falls 2.7% in Q1