The European car market might surge 2 percent in 2014 as demand slowly rebounds from a two-decade low, according to the ACEA group. European sales have dipped for six straight years and is not expected to return to pre-crisis levels in the "foreseeable future," ACEA President Philippe Varin said at a press conference. He noted that sales growth in December shows that "the market may now clearly be bottoming out." He said that they are hoping that 2014 will “herald the transition toward a recovery." Carmakers logged an overall 1.8-percent drop in sales in Europe in 2013 to 12.3 million vehicles, the lowest since 1995, ACEA said.
Carmakers like Renault and Ford Motor Co. are expecting a gradual recovery in European demand, although growth will depend on economic activity in France, Spain and Italy. Industrywide deliveries in the European Union -- excluding Iceland, Norway and Switzerland – are expect to surge "just above" 12 million vehicles from about 11.8 million cars in 2013, according to Varin, who is also chief executive of PSA/Peugeot-Citroen.
PSA, Ford and General Motors are some of the carmakers shutting down their sites and cutting jobs in Europe to offset effect of the auto market's decline. German luxury car makers like Mercedes-Benz and BMW managed to retain or increase their regional market share as demand for high-end models was higher than for mass-market vehicles.
Carmakers are operating their European sites at an average 75 percent of capacity in 2013, Varin said. He said that authorities should try to create rules that would boost a recovery in production, like raising labor flexibility or providing EU social funds to help carmakers reorganize.