Wednesday, March 16, 2016

Europe’s New Car Sales Leaped Ahead in February


New car sales in the European Union rose 14% in February, helped in part by the extra sales day afforded by the leap year, though auto executives have cautioned that full-year growth will be more modest even as volumes head back toward precrisis levels.
Italy, with sales up 27%, led double-digit gains in Europe’s biggest auto markets, including France, Germany and Spain, though growth in the U.K. was a relatively modest 8.4% compared with February last year. Every country except the Netherlands and Greece recorded gains.
Volkswagen AG, which is reeling from the impact of its emissions-cheating crisis, underperformed both the region as a whole and its home market.
Europe’s biggest car maker by sales returned to growth with an 8% rise thanks to a strong showing from its Audi and Skoda brands, but continued to lose market share as rival volume manufacturers Ford Motor Co.General Motors Co., Fiat Chrysler Automobiles NV and France’s Renault SA benefit from the VW brand’s tarnished image.
Despite the robust showing in February and 10% growth through the first two months of the year, most auto executives are forecasting a more modest advance of about 2% to 3% for the entire year. Even after gains the past two years, volumes of new cars registered in Europe closed 2015 still 12% below the peak reached in 2007, before the financial crisis devastated car manufacturers and other industries on the continent.
“In 2016, we foresee a 3% increase in the car market but we must not forget that the crisis caused a loss of 3 million [in car sales],” Alfredo Altavilla, Fiat Chrysler Automobiles NV’s Chief Operating Officer for Europe, the Middle East and Africa, said by email.
Some analysts are even more cautious. IHS Automotive predicts sales will grow only 1.5% this year in Western Europe, which accounts for about 90% of the EU’s total volume. Even at the more optimistic 3% forecast by most executives it would still take another five years for Europe to reach its precrisis levels.
At the same time, the U.S. hit an all-time sales record last year and has continued to advance into 2016 though at a more modest pace.
New car registrations, a proxy for sales, rose to 1.06 million vehicles in the EU in February from 924,534 vehicles in the same month last year, according to data released by the European Automobile Manufacturers' Association, or ACEA. It was the bloc’s best February for sales since 2008.
Fiat Chrysler Automobiles’ performance powered Italy’s particularly strong February with sales for the Italian-American car maker jumping 23%. The group’s Jeep brand had its best ever February in Europe and posted a 28th straight monthly gain thanks in large part to its relatively new Renegade crossover.
Italy’s surge comes as the country closed out last year still 40% below the 2007 level. Spain still has 60% to make up and France about 7%. Combined, the three countries closed 2015 with 2 million in vehicle sales less than their precrisis highs with Italy alone accounting for half of that.
“There is no reason for Europe not to come back to where it was before (the crisis), but it is going to take more time,” said Carlos Ghosn, Renault Chief Executive, said earlier this year. “The market in Europe went down more slowly than in the U.S. and has recovered more slowly.”
Ford and GM’s German unit Opel had a good February, with registrations up 19% and 18% to outperform their leading rivals other than Fiat Chrysler and Daimler AG, the maker of Mercedes-Benz cars.
For Volkswagen, its flagship VW brand has taken the brunt of the fallout from the emissions scandal.
VW, which accounts for about half of the group’s total sales, again underperformed the European market, with its market share slipping to 11.4% in February from 12.4% in the same month last year. The German auto maker’s overall market share was 23.9%, a drop of almost 1.5 percentage points.
But some analysts had feared worse. “The declines seen so far are much less severe than we and many others had forecast,” said analysts at research frim Evercore ISI.

No comments:

Post a Comment