European mass carmakers worst hit in August

Mon Sep 3, 2012 2:22pm EDT
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By Laurence Frost

PARIS (Reuters) - Monthly car registrations fell again in France and Italy in August with mass brands suffering most as Mediterranean countries bore the brunt of the euro zone debt crisis and its withering effect on consumer demand.

French sales tumbled 11 percent to 96,115 cars in August, for a tenth monthly decline, the CCFA industry association said, while Italian sales fell 20 percent to 56,447 units, their ninth consecutive double-digit fall, according to automotive think tank Promotor.

The August decline led Promotor to trim its full-year forecast to 1.370 million units from a previous 1.379 million, itself a cut from an outlook of more than 1.4 million units at the end of June.

"Without intervention to help boost the purchasing power of families via tax reductions and a relaunching of consumption it will be very difficult to see any sign of recovery," Jacques Bousquet, President of Italy's car industry association UNRAE, said in a statement on Monday.

Spanish car sales rose 3.4 percent as customers rushed to complete purchases and beat a sales tax rise in September. Analysts said the downtrend would likely resume this month.

"We still do not see any signs of recovery on the horizon," said Flavien Neuvy, head of French auto-industry think tank Cetelem.

The country's main growth drivers are at a standstill, with mass-market carmakers worst hit, Neuvy said. "We are seeing a polarization of demand, with premium and low-cost brands doing much better."

The mid-market Renault (RENA.PA: Quote) brand saw domestic registrations plummet 30 percent, even as its low-cost Dacia marque recorded a 21 percent gain on runaway sales of its no-frills Sandero subcompact and Duster SUV. [ID:nL6E8K328M]   Continued...