LEAD: New car sales in Europe fall amid deepening economic gloom

Nov 16, 2011, 8:40 GMT

Berlin - New car registrations in Europe fell by 1.8 per cent in October, the European Automobile Manufacturers' Association (ACEA) said Wednesday, amid signs of deepening economic gloom across the region.

The month-on-month drop brought total new registrations in the 27-member European Union down to 1.01 million vehicles, with sharp falls in the nations that have emerged at the heart of Europe's debt crisis.

This includes Italy and Spain, where new car registrations slumped by 5.5 per cent and 6.7 per cent respectively on the month in October. Between January and October registrations tumbled by 10.8 per cent in Italy and 19.7 per cent in Spain, the Brussels-based ACEA said.

The monthly falls in the three cash-strapped nations that have tapped the EU-led bailout out - Greece, Ireland and Portugal - was even more dramatic. Registrations plunged 51.8 per cent in Ireland, 40.5 per cent in Portugal and 35.7 per cent in Greece.

Automotive forecasters J.D. Power & Associates predict that car sales in Western Europe will drop to 12.6 million vehicles in 2012 from the 12.8 million projected for this year. Car sales came in at 13 million in 2010.

This follows moves by governments across Europe to mount a tough round of fiscal austerity to cut back high deficit-and-debt levels.

Europe posted a paltry 0.2-per-cent growth rate in the quarter ended September, the EU statistics office Eurostat said Tuesday, with economists warning that the region faces a marked slowdown in the run-up to the end of the year.

Still, the ACEA data offered some hope of recovery for car dealers. Car registrations in Iceland, whose economy took a beating as a result of the world financial crisis, rocketed up 155.2 per cent in October. Iceland is not a member of the EU.

France's top carmakers - the PSA Peugeot-Citroen group and Renault - along with Italy's Fiat helped to lead the falls among manufacturers, the ACEA figures showed.

While the PSA group's October registrations were down 6.4 per cent, Renault posted a 2.3-per-cent drop. Fiat's sales dropped 10.3 per cent.

Total new EU registrations slumped by 1.2 per cent to 11.13 million during the ten months to October, when compared with the same period in 2010. This was despite a 9.8-per-cent jump in sales in Europe's biggest car market, Germany.

Leading German carmakers also bucked the trend with the Volkswagen group and the BMW group both reporting solid gains in October and during the first ten months of the year. Volkswagen is Europe's biggest carmaker and BMW produces the world's top premium car brand. The Daimler group, however, reported a drop in registrations.

Total German registrations increased 0.6 per cent month on month in October.