For 10 straight months, Toyota Motor Corp., Fiat S.p.A. and Ford Motor Co. were hit by declines in European car sales as consumers slashed spending following the end of government incentives. Toyota’s European sales dropped 11 percent, Fiat had a 20 percent decline and Ford dropped 9 percent. ACEA, the European automakers association, recently said that registrations in the region fell 1.1 percent to 1.07 million vehicles in January 2011.
Buyers are now holding back after the end of government incentives used to encourage purchases during the worst of the recession.
Volume carmakers in Europe are being pressured to cut prices as overcapacity and falling sales have led to an oversupply of vehicles. Ian Fletcher, an HIS Automotive analyst in London, said that vehicle markets are still coming under pressure for various reasons – doubts about economies, payback from scrapping schemes and job security worries.
He added that Romania and Ireland are the only European countries still offering incentives. Sales declined in three of the top five markets, dropping 21 percent in Italy, 24 percent in Spain and 12 percent in the United Kingdom. France gained 8.2 percent and Germany gained 17 percent.
Europe’s biggest carmaker, Volkswagen AG, benefitted from the rebounding sales in its home market as Europe's largest economy grows. VW posted a 6 percent rise in January 2011 to 227,212 vehicles and its market share increased to 22.1 percent from 20.6 percent. [via autonews - sub. required]