Car sales in Europe for September 'encouraging' news

BRUSSELS, Belgium October 14, 2003; Paul Geitner writing for the AP reported that Western European car sales in September were 4.4 percent ahead of last year, raising hopes that the market may be on the road to recovery, the Association of European Auto Manufacturers (ACEA) said Tuesday.

Registrations, which reflect sales, amounted to 1.36 million in September, with gains in all major markets. However, the January-September period was still down 1.5 percent compared with 2002, ACEA said. It also noted that much of the recent turnaround was due to widespread manufacturer incentive programs.

Nevertheless, "this positive result looks encouraging," ACEA said. Even though Europe's economic growth "remains sluggish," consumer confidence is strengthening in some markets.

Asian manufacturers continued to post some of the biggest gains, although their market shares remained relatively small. Nissan Motor Co. had its best ever September, with sales up 18.8 percent on a year ago.

European luxury car makers also did well, with DaimlerChrysler AG's Mercedes group up 9.3 percent. Volkswagen AG's Audi gained 15.7 percent but sales of its eponymous brand were down 1.7 percent due to delays with the new Golf V.

Sales at BMW AG climbed 3.3 percent, putting the Munich-based car maker on track to beat last year's record sales.

Sales in Germany, Europe's biggest car market, were up 6.8 percent on the year in September, in contrast to a 5 percent drop recorded the previous month. The increase was driven by model launches at the Frankfurt Motor Show.

Spain surged 14.6 percent. Italy was up 9.8 percent despite the end of government incentive schemes, continued economic malaise and rising unemployment. However, Italian car maker Fiat failed to benefit. Its sales slid back 0.7 percent.

Increased price competition lifted registrations in France by 1.6 percent. Renault benefited the most, with sales up 15.9 percent, largely due to the launch of the new Megane.

Rival PSA Group's Peugeot brand only managed a 0.6 percent increase. The company is to stop vehicle production at a factory near Paris Oct. 27-Nov. 2 as it seeks to cope with the weak market.

September also spelled more misery for Ford Motor Co. Its group sales fell by 5.1 percent to under 157,000 units, with the high-end Volvo unit down the most: 15.7 percent. U.S. rival General Motors Corp. saw its group sales climb 4.1 percent to nearly 146,000 units.

Last week Ford announced 3,000 layoffs in Belgium and the scrapping of a euro900 million (US$1.1 billion) investment.

Britain held up well despite analyst concerns that the market could be running out of steam. Sales rose by 1.5 percent, beating last year's record figure.

The ACEA figures cover all 15 European Union countries plus Iceland, Norway and Switzerland.

ACEA: http://www.acea.be