Car sales in western Europe rose for the fourth straight month in May despite fewer shopping days and slowing consumer spending in patches of the continent.
According to Reuters, a strong showing in Italy, which overtook Britain last month as Europe’s second-biggest market, helped new car registrations overall rise 1.2% to 1.24 million units for the 18 countries in the region, Brussels-based carmaker association ACEA said on Tuesday.
“This marginal increase is partly due to fewer working days in most countries … but also to stagnating consumer confidence in some countries,” ACEA reportedly said in a statement.
The report noted that most European manufacturers have forecast modest growth for 2004 after a dip of around 1.3% last year, when the war in Iraq and feeble economies hamstrung consumer spending, particularly in France and Germany.
“Overall market growth of 1.2% is not so great,” Michael Raab, a car sector analyst at Bank Sal. Oppenheim in Frankfurt, told Reuters, adding: “If you are going to get in (as an investor), then do so selectively.”
Reuters said the rise in May brought the cumulative sales total for 2004 to 6.43 million units in the first five months, up 2.8% from a year earlier – the figures are for the 15 European Union member countries plus Norway, Iceland and Switzerland.
Paced by Hyundai’s 20.9% rise for May, Korean manufacturers continued to generate solid sales, boosting their European market share to 3.9% from 3.2%, but Japanese car makers’ growth slowed considerably, weighed down by an unusually sluggish month for Toyota, the report said, noting that the vehicle industry accounts for about 4% of the European Union’s gross domestic product and reflects the wider economy, in particular consumer confidence.
Germany was the worst performer among the top five European markets in May – registrations in Europe’s biggest economy slumped 7.3% in the month, hurt in part by the country’s one less shopping day than in May 2003, the news agency said.
Reuters noted that the May figure halted a fledgling recovery in Germany that had fuelled hopes for a sustained upturn this year – the German carmakers’ lobby has cited high fuel prices and talk of introducing motorway tolls for the waning demand.
On the other hand, the report added, sales in France, which had been Europe’s worst-hit major car market, rebounded in May, when registrations rose 4.8%, but Italy stole the show, with registrations up 12.1%.
Fiat, which got a new chairman and CEO who have to extract the group from financial crisis, outpaced the market with 4.4% growth, Reuters said.
Luxury carmaker BMW reportedly weathered the storm better than DaimlerChrysler – BMW saw registrations of its flagship BMW brand advance 10.2% for the biggest market share gain by an individual carmaker while DaimlerChrysler was burdened by a sharp decline in sales of its luxury Mercedes-Benz brand while it retools for a new model offensive; it forecasts a strong second half.
Reuters said the upturn in France did not give much of a boost to French duo PSA Peugeot Citroen and Renault – PSA, fighting stiff competition as rivals churn out new models, saw sales decline 2.8% in May, bringing the fall for the year to 3.8%, while Renault, which is pulling out of some less profitable European markets to protect its margins, saw sales up 1.0% thanks to some new cars, but its market share was flat.
Now the world’s second-biggest carmaker, Toyota posted a subdued month as solid double-digit growth so far this year slowed to just 2.3% in May, Reuters noted.
“This is something to wonder about,” Raab reportedly said, adding Japanese rival Nissan’s 1.5% dip also lacked pizzazz.
Europe’s biggest carmaker Volkswagen – counting on its revamped Golf to muster sales growth – saw group sales slip 2.1% amid a decline at its luxury Audi division, the Reuters report said, adding that sales of the Volkswagen brand alone edged up only 0.3% despite growing numbers of new Golfs on the road.