Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Antoine Antoniol/Bloomberg

Shareholders look at a Renault SA Latitude vehicle at the company’s annual general meeting at the Palais des Congres in Paris.

Shareholders look at a Renault SA Latitude vehicle at the company’s annual general meeting at the Palais des Congres in Paris. Photographer: Antoine Antoniol/Bloomberg

Ghosn Sees 2-3 `Difficult' Years for Europe Cars

Feb. 16 (Bloomberg) — Carlos Ghosn, chief executive officer of Renault SA, talks about the outlook for Europe car market, pricing and debt financing.
He speaks with Bloomberg Television’s Caroline Connan in the Paris suburb of Boulogne Billancourt. (Source: Bloomberg)


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Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Renault, Fiat Pace European Car-Sales Drop as Demand Stalls

Manan Vatsyayana/AFP/Getty Images

The Renault Duster vehicle is displayed during the 2012 India Auto Expo in New Delhi, India.

The Renault Duster vehicle is displayed during the 2012 India Auto Expo in New Delhi, India. Photographer: Manan Vatsyayana/AFP/Getty Images

Renault SA (RNO), Fiat SpA (F) and PSA Peugeot
Citroen (UG)
led the biggest decline in European car sales since June
as consumers balked at making big purchases after the region’s
economy shrunk.

Registrations in January fell 6.6 percent to 1 million
vehicles, marking the fourth consecutive monthly decline,
Brussels-based European Automobile Manufacturers’ Association,
or ACEA, said today in a statement.

Sales in France, the region’s second-biggest market after
Germany, plunged 21 percent, while deliveries in Italy, the
third-largest market, slumped 17 percent. Gross domestic product
in the 17-nation of euro area fell 0.3 percent in the fourth
quarter, the first drop since the second quarter of 2009.

“Carmakers too dependent on small cars and their national
markets, as the French ones and Fiat, are suffering the most,”
said Ian Fletcher, a London-based analyst with IHS Automotive.
“They are basically trying to keep their heads out of the
water.”

Peugeot, Europe’s second-biggest carmaker after Volkswagen
AG (VOW)
, plans to sell assets after its carmaking division missed a
target of break even in 2011. The Paris-based carmaker’s sales
in Europe fell 15 percent to 124,240 vehicles.

The European car market may shrink 5 percent this year,
Peugeot Chief Executive Officer Philippe Varin told journalists
yesterday. That would mark the fifth consecutive annual sales
drop for the region.

‘Economically Unproductive’

Fiat, whose mass-market brands lost about 500 million euros
in the region last year, is looking for a partner in Europe to
cut costs and share technology as it doesn’t see a recovery in
the market before 2014. Fiat’s European sales dropped 16 percent
to 69,479 autos.

Fiat Chief Executive Officer Sergio Marchionne, who shut
down a factory in Sicily at the end of last year, expects the
Italian market to fall to the lowest since 1985 this year.

“We need to remove the fact that we’ve got the mass car
market in Europe, which is economically unproductive and which,
just in raw, pure economic analysis, does not deserve capital
allocation of any kind,” Marchionne said on a conference call
with analysts Feb. 1.

Renault’s registrations dropped 25 percent to 82,724 cars.
The company, based in the Paris suburb of Boulogne-Billancourt,
today reported a decline in earnings before interest, taxes and
one-time items to to 1.09 billion euros ($1.42 billion) from 1.1
billion euros a year earlier.

Daimler Gain

Registrations in Germany, Europe’s largest auto market
accounting for about one in five cars sold in the region,
slipped 0.4 percent to 210,195 autos.

Daimler AG (DAI), whose Mercedes-Benz division is the world’s
third-biggest luxury-vehicle maker after Bayerische Motoren
Werke AG (BMW)
and Volkswagen’s Audi division, posted the biggest gain
among European-based carmakers, with sales rising 5.1 percent to
49,145 vehicles.

General Motors Co. (GM) posted a 14 percent decline to 73,376
vehicles, as a 21 percent decline for the Opel and Vauxhall
brands more than offset a 27 percent gain for Chevrolet.

European sales at Volkswagen, the region’s biggest
carmaker, rose 1.6 percent to 240,736 vehicles. The Wolfsburg,
Germany-based manufacturer, which also owns the Skoda and Seat
brands, was boosted by a 7.2 percent gain by Audi, which will
revamp the A3 compact this year.

To contact the reporter on this story:
Tommaso Ebhardt in Milan at
tebhardt@bloomberg.net

To contact the editor responsible for this story:
Chad Thomas at
cthomas16@bloomberg.net