PARIS â€“ European new-vehicle sales were off 18.3% in February, but there was room for optimism in the results.
â€śThis could be the start of the beginning of the end of the crisis,â€ť says analyst Jean-Michel Prillieux of Mavel SA.
He cites Februaryâ€™s lower decline than in January and the fact it had one less selling day than year-agoâ€™s exceptionally strong month as reasons for the positive outlook.
Prillieux also points to the success of the scrappage program in Germany that boosted sales in that country 21.5%. Buyers trading in cars older than 9 years receive a E2,500 ($3,219) bonus.
Similar programs in France and Italy didnâ€™t result in gains but may have helped mitigate the sales declines in those countries.
Motor Co. has asked the German government to continue its support beyond the budgeted 600,000-unit sales, noting the incentive has allowed its Fiesta plant to run at full speed.
Meanwhile, Slovakia and Austria have announced plans to institute similar bonus schemes.
Total car sales in Europe, including three countries not members of the European Union, were 968,159 units. The decline was worse in Eastern and Central Europe, where national economies have been hit the hardest. Governments there, indebted and in trouble financially, may not be able to support scrappage schemes. Poland, up 7.3% to 30,194 units, was the loan market in Central/Eastern Europe to post a gain. Iceland, which is in bankruptcy, saw sales decline 91.2% to just 91 units in February.
Among brands, Jaguar, Alfa Romeo, Suzuki and Hyundai all managed to increase sales over year-ago. All other groups were down, withCorp.â€™s Cadillac and Corvette models off 70.4%. Volkswagen Group, and Fiat Auto Group, as well as the and Mazda brands, gained market share in February.
For the year,Motor Ltd.â€™s Land Rover brand, down 56.7%, performed the worst, while its Jaguar brand was up 18.9%, the best performer in Europe.
In a research note, Brett D. Hoselton, senior automotive analyst with KeyBanc Capital Markets, is less optimistic about the European sales outlook.
â€śWhile we view an increase in registrations due to scrappage programs as a positive, we would note thatâ€¦the scrappage programs are simply pulling ahead sales that would have naturally occurred at a later date,â€ť he writes.
Hoselton says Keybanc Capital continues to forecast a 20% decline in European production, with the most severe declines taking place during the yearâ€™s first half.