Car sales in France dropped 4 percent in October to 160,162 units, with consumers delaying or cancelling making large buys due to falling confidence and deflation risk, according to CCFA industry association. The sales drop in October marks the first year-on-year decline since February, after adjusting for the number of selling days each month.
Association spokesman Francois Roudier said that there are indications of weakening economic confidence in France, noting that the country has so far lagged behind Europe's auto market recovery.
According to CCFA, car sales in France jumped just 1 percent in the first 10 months of the year are up just 1 percent, with Roudier saying that the association will be reviewing its 2 percent full-year growth forecast in the next few weeks.
France has suffered from two straight quarters of zero economic growth, prompting both French companies and consumers to hold back making purchases, which may indicate that Europe may succumb to a deflation.
Local carmakers Renault and PSA/Peugeot-Citroen were able to put up some defense against the decline, after dropping 0.4 and 1.5 percent, respectively in October.
PSA and Renault likewise were able to hike their share of the French auto market in the first 10 months of 2014 to 56.1 percent from 53.6 percent in the same period last year, as boosted by strong sales for new models like the Peugeot 308 compact and Renault Captur small SUV.
Other major carmakers were not so fortunate in France. For instance, Volkswagen Group posted a 5-percent drop in French registrations. American carmakers Ford and General Motors logged 7-percent and 22-percent fall in sales in October, respectively.