European car sales rise for a 3rd month led by VW, Renault

MILAN - European new car sales rose a third consecutive month in November, the longest period of gains in four years, as demand for autos from Volkswagen and Renault contributed to signs that an industry wide decline is ending.

Registrations in November increased 0.9 percent from a year earlier to 975,281 vehicles, the Brussels-based European Automobile Manufacturers Association said Tuesday in a statement. The growth followed gains of 4.6 percent in October and 5.5 percent in September.

The economy of the 17 nations sharing the euro will probably expand this quarter,continuing growth after a six quarter recession in the region ended in the three months through June, according to analysts surveyed by Bloomberg. New vehicles spurring car sales in Europe include the Golf hatchback and Skoda Rapid Spaceback wagon at Volkswagen, the region’s biggest car maker, and the Captur compact crossover at Renault.

“I hope and think” Europe’s car market has hit bottom as “it’s slowly stabilizing,” Alfredo Altavilla, chief operating officer of Italian automaker Fiat SpA’s European operations, told reporters in Milan. “Talking about recovery is another story.”

The regional auto market is still on track for a sixth straight annual decline, as 11-month registrations fell 2.8 percent to 11.4 million cars. Full-year sales in 2012 dropped 7.8 percent to 12.5 million vehicles.

Even with the three-month gain, the longest stretch of growth since the period from June 2009 to March 2010, sales remain close to the lowest since the European Automobile Manufacturers Association began compiling figures in 1990, said Quynh-Nhu Huynh, the trade group’s economics and statistics director. Except for November, when figures were the third-worst for the month, “registrations recorded for every month this year were at the lowest level or second lowest ever recorded to date,” she said in an email.

Among Europe’s five biggest car markets, demand increased 15 percent last month in Spain, which ranks fifth in the region, and 7 percent in Britain, which places second. The Spanish government revived a cash-for-clunkers incentive program in October to increase car sales. Registrations dropped in Germany, France and Italy.

Smaller markets with sales growth of 20 percent or more included Greece, Portugal, the Netherlands and Lithuania. The Athens-based Association of Motor Vehicle Importers Representatives said earlier this month that corporate-fleet upgrades helped Greek delivery numbers in November. Portuguese and Dutch customers bought cars in advance of government surcharges taking effect on some vehicle purchases next year.

The only large European car makers to post group sales increases in the region last month were Wolfsburg, Germany-based Volkswagen and Renault.

Volkswagen’s registrations in Europe rose 3.2 percent in November, with gains of 0.8 percent at the namesake brand, 9.4 percent at the Seat marque and 18 percent at the Skoda nameplate. The Audi division, the world’s second-biggest maker of luxury vehicles, posted a 3.2 percent decline.

Renault increased European sales 8.9 percent, including a 2.6 percent gain at its main brand and a 30 percent surge at the entry-level Dacia division, whose offerings include a new version of the Sandero hatchback.

Renault and larger French competitor PSA Peugeot Citroen were the manufacturers offering the steepest discounts in Germany, averaging 13.6 percent off the list price, according to Autohaus PulsSchlag trade magazine. Asian producers ranked a combined fourth in discounting in Germany, Europe’s biggest vehicle market, at 12.6 percent, while Volkswagen was sixth with price cuts of 11 percent.

“We are likely at the end of a very deep downturn for the industry but a recovery is very much linked to a real end of government austerity measures in Europe, which have mainly hurt Mediterranean countries,” said Gian Primo Quagliano, head of automotive research company CSP in Bologna, Italy. “The boost at VW and Renault, especially at the Dacia brand, shows consumers are ready to buy new models and that car makers coming out with new vehicles can benefit.” Information for this article was contributed by Joao Lima , Fred Pals and Paul Tugwell of Bloomberg News.

Business, Pages 25 on 12/18/2013

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