Shares in Volkswagen fell on Monday as concerns over the German carmaker’s new Golf range and the impact of a strong euro again deterred investors and led Merrill Lynch to cut its rating on the stock to “sell”, a Reuters report said.

“The long-anticipated new Golf V seems (to be) off to a slow start,” Merrill analysts reportedly wrote in a research note on Monday as they cut their rating on the stock to “sell” from “neutral”.

VW blames now-resolved production ramp-up glitches, but many German dealers are reportedly complaining of weak demand,” the analysts said, according to Reuters.

The news comes as Volkswagen (GB) is launching the new Golf in the UK market, the largest for right-hand drive versions.

Reuters said that fears that Volkswagen may suffer more than its competitors due to the strength of the euro, which hit record highs versus the dollar this time last week, were also a cause for concern.

“Adverse currency movements will continue to impact VW more than its peers,” Merrill reportedly said, explaining that the firm had been slower to hedge itself against currency fluctuations than rivals and would therefore have paid a higher price for the insurance.

Assuming VW bought currency contracts in 2003 at about $1.18 per euro, Merrill reportedly said the firm would have limited the pain of the euro’s recent $1.29 peak, but not as much as BMW, Mercedes or Porsche who had bought protection for this year and next as early as 2000 when the single currency was much cheaper.

According to Reuters, Merrill said that based on an average euro exchange rate versus the dollar of $1.20 in 2004 and 2005, it had cut VW’s earnings per share estimate for this year by 8% to 3.62 euros and next year’s by 16% to 3.75 euros.

Weekend reports that VW had delayed the launch of a new mini-van based on the Golf V were also weighing on shares in Europe’s biggest carmaker, traders told the news agency.

“The combination of bad press and the sell recommendation is putting pressure on VW stock,” one Frankfurt-based trader told Reuters.

A spokesman for Volkswagen confirmed the delay to Reuters, reportedly adding that the firm wanted to distance the launch of the Golf Plus van from that of the Golf V series last year.