Large declines to southern European car markets dragged the EU car market down by 2.8% (to 1.2m) in June and 6.8% in the first half (to 6.64m), according to data released by ACEA.
The downturn to EU car sales began in October of last year amid a deteriorating outlook for the European economy.
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First half data showed that the downturn prevailed in Spain (-8.2%), France (-14.4%) and Italy (-19.7%). The Greek and Portuguese markets posted first half car market declines in excess of 40%.
On a more positive note, the German car market managed first half growth of 0.7% to 1.63m units and the UK car market registered growth of 2.7% to 1.06m cars sold. There was also significant car market growth in the EU member state markets of central Europe (Poland – the largest – up 7.6%; Romania up 5%; Slovakia up 0.4%; Czech Republic up 7%; Bulgaria up 7%).
The data confirms that issued earlier this month for Western Europe issued by LMC Automotive.
Peter Fuss, Senior Advisory Partner at Ernst & Young’s Global Automotive Centre, said that with the focus of economic uncertainty shifting from Greece to Spain and Italy, further decline in sales across Western Europe in H2 2012 are to be expected.
“Manufacturers are likely to continue to offer significant discounts over the rest of 2012,” he said.
“Apart from the credit crisis, the rising youth unemployment (23% across the EU) represents a consumer segment that is not likely to be able to afford vehicles for some time in the future. The auto industry will, therefore, have to look at ways to formulate new affordable mobility propositions.
“The shrinking sales also further aggravate the vehicle manufacturing overcapacity problem in Western Europe, particularly for manufacturers in Italy, France and Spain.”
At the manufacturer level, volume makers were generally hit hard by lower demand in mainstream segments in the first half. It was a mixed picture for market leading Volkswagen Group, with the VW (-2.2%), Skoda (+2.3%) and Audi (+4.5%) brands seeing some favourable market geography, but Seat (-16.6%) suffering from the continuing market slide in Spain. VW Group H1 sales were down 1.5% at 1.59m units.
With the French and Italian markets seeing large first half drops, PSA (-13.9%), Renault (-17.1%) and Fiat (-17.1%) saw major sales declines. GM’s first half decline of 10.8% was mitigated by strong Chevrolet sales (+14%) with Opel/Vauxhall off 15% on last year’s pace. Ford was down 10.4% on last year.
First half sales in the EU were notably strong for Hyundai (+11.6%), Kia (+24.7%), Jaguar (+9.5%) and Land Rover (+42.4%) – JLR combined sales up 34.6% to 64,518 units.
Lexus was also up 17.1% in the first half to 14,690 units (CT200h boost).
