Car Sales Collapse In Spain And France

PARIS (Reuters) – Car sales dropped further in austerity-hit France and Spain last month, and France’s CCFA auto industry association cut its full-year market forecast, highlighting the pain for automakers that have warned there is no recovery in sight.

French September car registrations dropped 18 per cent year-on-year, while Spain’s plunged 37 per cent, the countries’ main industry associations said on Monday. Italian market figures were due later in the day.

The Spanish plunge was accentuated by a September 1 sales-tax increase, which had brought forward some sales to August.

Would-be buyers also held out for renewed scrappage incentives introduced on Monday.

The September decline was nonetheless a “disappointing result”, the ANFAC association said.

Scrapping incentives offer car buyers a bonus for trading in old cars for a new model. Previous schemes in countries such as France, Germany and Italy helped Europe’s car market to withstand the last economic slump in 2008-2009.

European car executives gathered at the Paris auto show last week warned that a rebound may be years rather than months away.

CUTTING FORECASTS

Announcing the French market’s 11th straight monthly decline on Monday, the CCFA slashed its 2012 outlook to predict a 12 per cent slump, instead of the 10 per cent contraction previously forecast.

Renaulthad cut its own market forecasts on September 26 to predict declines of 13 per cent in France and 7-8 per cent in Europe.

The French brand suffered some of last month’s biggest declines, with sales dropping 36 per cent at home and 51 per cent in Spain. Fordsales also lost ground in both markets, tumbling 32 per cent in France and 40 per cent in Spain.

For the first nine months, the French car market recorded a 14 per cent decline, and Spain shrank 11 per cent.

While PSA Peugeot Citroen’ssmall cars suffered in the lull ahead of renewed Spanish incentives, the twin brands fared better at home.

Buoyed by accelerating sales of its new 208 subcompact, Peugeot’s French registrations fell just 1 per cent in September, resisting the market slump. Citroen dropped 10 per cent.

Volkswagen, Europe’s biggest automaker, fell in line with the French market and lost ground for its core VW brand in Spain, where sales fell 44 per cent.

Fiatdropped 34 per cent in France but just 13 per cent in Spain, limiting the damage with an 82 per cent gain in registrations of its Panda mini.

(Reporting by James Regan, Laurence Frost and Robert Hetz; Editing by Helen Massy-Beresford)

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