New car sales in Germany in January surged 7 percent to 206,000 cars. According to market analyst LMC Automotive, such a strong increase in German car sales in January bodes well for western Europe for 2014. The seasonally adjusted annualized rate (SAAR) of sales as indicated by figures in January suggests that Germany may likely grow 6 percent, bringing the market back above the 3 million mark.
LMC believes that the rebound will be backed by a solid recovery in the German economy and consumer confidence. On the other hand, the car market in the United Kingdom saw sales in January surge 8 percent year-on-year to 155,000 units. UK’s growth is also being supported by low interest rates, improved consumer confidence and better economic activity.
The French vehicle market, meanwhile, only grew 1 percent to 125,000 units, while the Italy market rose 3 percent to 118,000 units. Analysts are more pessimistic about the French and Italian car market, noting that the SAARs for both reflect difficult economic conditions.
The Spanish market surged 8 percent in January to 54,000 units, boosted by continued government via a regional vehicle scrappage program.
LMC, however, believes that "until unemployment rates begin to fall from the lofty levels currently seen in Spain, any serious improvement in the car market will likely be postponed." As a whole, western Europe posted a 5-percent rise in car registrations in January 2014 to 901,000 units, LMC Automotive said. LMC expects full year 2014 sales to leap 3 percent to 11.9 million units.