European Car Sales See First Growth in Six Years
Car sales in the European Union rose for the first time in six years in 2014 as the economy slowly ticked forward in the economic bloc. According to the industry trade association ACEA, Sales were up 5.7% to 12,550,771, thanks, in part, to several government scrappage schemes and wholesale orders from companies across the continent.
It is perhaps telling, however, that it was the cheaper brands that saw most benefit from this rise in sales as customers erred on the side of caution with brands such as Dacia and Skoda reporting some of the largest jump in sales figures which saw Spain and the UK buying big as they saw sales rise in 2014, up 18% and 9.3% respectively. December saw a year on year sales rise of 4.7% across the continent, thus making it the 16th consecutive month where there has been one.
Spain’s growth may been down to their Plan PIVE incentive scheme which has been extended several times and offers price cuts on newer, low emissions cars.
Despite this good news, the industry would do well to remain cautious as many tax breaks and scrappage schemes are due to come to an end this year which once again may put a dent in sales. Carlos Ghosn, chief executive of Nissan-Renault, said earlier this month at the Detroit Motor Show that he expects European growth this year to be slow, at around 1%-2% but this does still signal growth. Peter Fuss, an automotive analyst at business services group E&Y, was more optimistic putting growth more in the region of 3% saying:
“We remain cautious about the ability of new car sales to return to their pre-crisis levels by the end of this decade. Furthermore, car sharing and other alternative trends of urban mobility are expected to gain relevance in the market amid shifting consumer preference.”
The European Union’s economy as a whole has been slowing down as of late and has suffered from sanctions placed on Russia in response to the crisis in Ukraine as well as counter sanctions. It has also seen large trading partners such as China suffer economically which has had a knock on effect. This growth in domestic sales will offer some cheer as the economic bloc looks to capitalise on its small growth and continue to push forward out of recession. France and Germany have both been pushing the rest of the continent forward and serious growth is expected to kick in at some point in the near future.