Europe’s carmakers have acknowledged a slow start to 2004 but said sales would eventually strengthen this year as new models and a firmer market help them overcome a weak dollar and fierce price competition.
According to a Reuters report from the Geneva motor show, executives from several carmakers said their sales so far this year were below year-ago levels or had shown some weakness. But they insisted that the full year would bring overall growth.
French brand Peugeot, at the end of a product drought, has seen sales fall globally so far this year, the report said.
“Our February market share will be roughly the same as last year, perhaps a little bit better,” Frederic Saint-Geours, head of the PSA Peugeot Citroen unit, told Reuters in an interview. “So far this year our global volumes are lower…but we expect 2% to 3% growth for the year.”
He said the new Peugeot 407 sedan unveiled at the show would help rescue volumes, with 150,000 units expected to move this year and 300,000 in 2005. Peugeot has also introduced a new Chinese-built sedan version of its top-selling 307 at the show, Reuters noted.
“We are slightly behind last year (in February), which is what we expected all the time, Mercedes chief Juergen Hubbert told Reuters, citing model changes for the A- C- and M-class cars.
“The first half would be below last year and the second half would be above last year so that at the end we expect to be slightly better than 2003,” Hubbert reportedly said.
Reuters said things were more upbeat at BMW where the new 5-series helped boost February sales by 4%. Executives reportedly said there were no current plans to shift more production to the United States, although that was an option.
BMW finance chief Stefan Krause reportedly insisted that hedging ensured the firm’s 2004 profits were not threatened by the weak dollar.
“Most of the carmakers appear to have more or less confirmed what we’ve heard from them recently about a slight upward trend… The BMW numbers for example show that February was a bit better than January, particularly in Europe,” Juergen Pieper, an analyst at German private bank Metzler in Frankfurt, told Reuters.
Fiat, which sparked optimism with the successful launch of its new Panda and Lancia Ypsilon small cars late last year, reportedly said orders for those models slowed in January and warned that its Stilo, a massive disappointment since its launch [at Geneva two years ago], would continue to suffer this year as it faces a new Volkswagen Golf.
Nonetheless, Fiat Auto’s new chief executive Herbert Demel predicted single-digit sales growth in 2004 after an 8.8% drop in 2003 to 1.7 million cars, Reuters noted.
Reuters said that, with a blizzard of new models hitting the market, pricing remains a big concern for car industry executives, as does the relentless march of Japanese and Korean carmakers – boosted for the time being by a strong euro – into the European market.
Toyota has targeted a 3% rise in sales to 860,000 units in 2004 as it strives toward 1.2 million units by 2010 and its January and February sales surged 24% from a year earlier, giving it 5.5% of the European market, the report noted.