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Car Sales Rally, But Pre-Crisis Levels Still Distant

“The big winner has been Volkswagen, which raised its market share to 24.1 per cent from 18.9 per cent”

Car sales in Western Europe rose 3.6 per cent in April to bring 2014’s tally so far to 6.3 per cent above last year, but before manufacturers start breaking out the champagne, they should remember that the market is still way short of pre-crisis 2007 levels, according to a report.

Sales have been lower for six years in a row (with the exception of a 0.6 per cent government scrapping subsidy in 2009) before starting a recovery in 2014, as Europe’s economic crisis scared buyers away from car show rooms. Recent data shows confidence is returning, but there is still a long way to go.

Only Germany and Britain have returned to pre-crisis levels, while France, Spain and Italy are still way short of 2007, said the report from Automotive Industry Data (AID).

Germany is Europe’s biggest market, accounting for nearly 25 per cent of the first four months total of 4.2 million, versus 3.9 million in the same period last year. In the first four months of 2007, Western Europe car sales were 5.2 million.

While the overall market has sagged, the companies performing in Western Europe have turned in sharply contrasting performances. The big winner has been Volkswagen of Germany, which raised its market share to 24.1 per cent in the first four months of 2014, up from 18.9 per cent in the same period of 2007. Big sales from its workaday Skoda subsidiary and the Audi premium division were a big help.

The big losers were led by Peugeot-Citroen of France and Fiat of Italy. Peugeot’s market share dived 2.2 percentage points over the period to 11.3 per cent. Fiat Group lost 1.6 percentage points of market share to 4.9 per cent. Other poor performers included GM Europe’s Opel-Vauxhall – down to 7.4 per cent from 9.8 per cent, and Ford Europe – down to 7.7 per cent from 8.5 per cent.

While Peugeot, Fiat, Ford and GM were cratering during this period of feeble sales, some others as well as VW were on the make, including Hyundai-Kia of Korea – 5.7 per cent in the latest period versus 3.3 per cent in 2007. Nissan of Japan also did well – 3.8 per cent versus 1.8 per cent. Perhaps most surprisingly, mighty Toyota of Japan has seen its not so impressive market share of 5.5 per cent in 2007 slip to 4.0 per cent now.

Renault of France’s market share slipped by 1.2 per cent, excluding its Dacia third world cheap and cheerful subsidiary.

“Some market observers take the view that the 1.2 percentage point loss from the Renault brand is due largely to in-house cannibalization from its Dacia offshoot,” said Peter Schmidt, AID editor.

Schmidt said the latest overall numbers show there’s no room for euphoria.

“The outwardly encouraging car sales bounce seen in the wider West European region still hides the uncomfortable truth that in the vast majority of markets, underlying car recovery growth still has a lot further to run before the levels seen in early pre-crisis 2007 are reached again,” Schmidt said.

Schmidt said sales in Italy and Spain were still 47 per cent less than the same period of 2007. France was down 11.3 per cent.

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