Europe September 2006: New Car Sales Slip Except Fiat and Toyota

FRANKFURT, Oct 13, 2006; Michael Shields European Auto Correspondent writing for Reuters - New car sales in Europe fell 2.6 percent in September, the fourth monthly decline in a row, but Fiat (FIA.MI: Quote, Profile, Research) and Toyota (7203.T: Quote, NEWS, Research) posted double-digit gains, industry data showed.

Japan's Nissan and its French partner Renault whose talks with General Motors on a three-way alliance just broke down -- were among the biggest decliners in a ferociously competitive market in September.

The fact that last month had one fewer working day than September 2005 contributed to a drop in new car registrations to 1.4 million vehicles, bringing market growth in the first three quarters to just 0.1 percent, Brussels-based carmakers group ACEA said on Friday.

High fuel prices and rising interest rates in some countries have made consumers hesitant to buy new cars, which is heaping pressure on manufacturers to wage a debilitating price war.

One way to buck the trend is to keep freshening model line-ups.

Fiat benefited from its new Grande Punto and Panda small cars plus the Alfa Romeo 159 sedan. New car registrations for the Italian group advanced 14.6 percent year-on-year, with a 19.3 percent increase at its core Fiat brand. Alfa Romeo brand sales gained 10.4 percent.

Japan's Toyota, the world's second-biggest automaker, saw sales of its flagship Toyota brand rise 9.9 percent to over 79,000 units, while registrations of its premium brand Lexus advanced by three quarters to more than 4,400 cars.

Audi and Skoda helped Volkswagen's registrations rise 2.2 percent to more than 270,000 units, keeping it atop the European tables with a market share of 19.3 percent in September and of nearly 20 percent so far this year.

Renault group sales slumped 14.2 percent. Sales of Renault brand vehicles alone retreated 14.7 percent as Chief Executive Carlos Ghosn shuns unprofitable business and gives up volume.

A weak French market in September also undermined Renault and PSA, Bank Sal Oppenheim's Patrick Juchemich noted.

Nissan continued to struggle through a new product drought. Its registrations plunged 26.2 percent, taking its market share to 2.4 percent from 3.2 percent a year earlier.

BMW, the world's biggest premium carmaker, boosted group registrations 2.4 percent as gains at its core BMW brand offset declines at Mini, which is ramping up a new model for launch before year's end. Asian carmakers had another mixed month.

Honda's sales advanced 6 percent, continuing its strong showing this year, and Mazda Motor Corp showed a gain of 5.1 percent.

But sales at South Korea's Kia Motors retreated 13.6 percent, extending their decline to over 10 percent so far this year. Kia was the fastest-growing brand in Europe in 2005.

European Auto Correspondent

U.S. carmaker Ford Motor Co outperformed the market with an 0.1 percent sales dip as the Ford brand balanced declines at premium marques Land Rover, Volvo and Jaguar.

September is a big sales month in Britain, Ford's biggest European market.

General Motors fared worse, dropping 9 percent amid sharp declines at Opel/Vauxhall and entry-level brand Chevrolet.

The ACEA data reflect registrations in all European Union countries except Malta and Cyprus and include Norway, Switzerland and Iceland. Excluding the newest EU members, registrations fell 2.8 percent last month to 1.35 million vehicles.