European car market drops for third straight month

FRANKFURT, July 15 (BestGrowthStock) – The European car market fell
in June for the third straight month as the artificial boost
from scrapping schemes across the continent continued to abate,
hurting sales for Fiat (FIA.MI: ), Ford (F.N: ) and Toyota (7203.T: ).

Registrations of new vehicles in the European Union dropped
6.9 percent to 1.34 million units last month driven mainly by
sharp declines in Germany and Italy, according to data published
on Thursday by the European industry association ACEA.

Hardest hit among major brands was the Fiat marque, heavily
dependent on both its domestic Italian market as well as demand
for small cars that were so inflated by government-sponsored
scrapping schemes in recent months.

Its figures revealed a 21 percent plunge while it
relinquished just over one full percentage point of market share
in the EU. Its Lancia brand performed even worse.

Meanwhile, Ford lost a lot of volume from its Fiesta
subcompact and Focus hatchback models. New registrations tumbled
nearly 20 percent.

Toyota also weighed on the market with a 15 percent decline
in its sales, possibly a continued after-effect from the safety
scandals that rocked the company earlier this year.

VW’s Spanish brand Seat oddly enough incurred a 16 percent
drop in demand, despite a sharp rebound in its domestic market.
Seat relies over-proportionately on sales of its Ibiza
subcompact.

Among the winners last month were Renault (RENA.PA: ) as well
as GM’s [GM.UL] Opel.

Opel has recently enjoyed a boost from its new Astra
hatchback that first hit markets at the very end of last year.
It also had some support from the next-generation Meriva small
monocab that debuted in markets in mid-June.

On Tuesday, Ford maintained its forecast for a drop in the
market of anywhere between 5.6 percent to almost 12 percent this
year.

“We will not sacrifice profitability for volume or share, as
some of our competitors seem to be doing. We believe such
unsustainable heavy discounting only damages brand reputation
and further weakens the market,” Ford of Europe sales chief
Ingvar Sviggum had said at the time.

(Reporting by Christiaan Hetzner)

European car market drops for third straight month