Car sales in western Europe fell by 16% in August over last year according to data released by JD Power Automotive Forecasting. The company said that the result 'confirms the view the market has now entered a serious downswing'.

JD Power also said it expects the decline to continue well into 2009 giving rise to the lowest market in more than a decade.

West European sales were estimated by JD Power at a little under 718,000 units in August, 16% down on the same month last year. Cumulative sales in the first eight months were put at 9.6m units, some 4.3% below the same period of last year.

JD Power is now forecasting that 2008 car sales in western Europe will turn out at 13.89m units, some 6.1% below last year's total. A further decline of 4.5% ie expected in 2009.

August sales were down across the region and car sales in Germany plunged by 10.4% over last year.

The seasonally adjusted annualised rate of sales (SAAR) held at July's low level of just 12.8m units a year.

JD Power said that the market decline this year is being driven by the deteriorating state of the European economy and the impact this is having on consumers. Given the poor economic outlook for the remainder of this year and next year in the region, it said that 'it seems very likely that there will be more bad news for the market in late 2008 and in 2009 before a recovery can emerge'.

According to JD Power, the German market, which in the earlier months of 2008 appeared to be on an increasing trend from a low base, has now started to 'sag under the weight of an increasingly concerned consumer'. The economic vigour from the early months has also now vanished, giving rise to a far flatter outlook, JD Power said.

The very poor state of the Spanish economy is taking a very heavy toll on car demand - the Spanish market was 41% down in August and a fall of up to 25% now looks plausible for 2008, with a further double-digit decline anticipated for 2009.

The Italian market is also in a state of rapid decline, though not to the same extent as Spain. The year started reasonably well, but things have deteriorated quickly and the selling rate during the last three months has averaged under 2.0m units a year. Sales could fall by 14-15% this year — a further decline is forecast for 2009.

French demand also eased back in August with the selling rate dipping below 2.0m units a year; a decline is expected for this year.

The UK market was 16% down on last year, also indicative of a poor economic backdrop.