Europe’s new car market continues to decline as troubled economy bites

June 22, 2012: According to the latest analysis from leading automotive intelligence provider JATO Dynamics, the European new car market experienced no respite from the challenging economic climate last month.

Overall, the market was down 7.3 percent on the same period last year and May superseded April with the greatest drop in month-on-month sales so far this year.

JATO’s key findings:

• The European new car market declined by 7.7% in May 2012 compared to same time last year

• Of the ‘Big Five’ markets, only Great Britain experienced increased sales in May while France recorded the greatest sales decrease

• Nine of top 10 brands experienced significant decreases in sales during May, only Audi recorded an increase compared to last year

• Renault’s Megane breaks into the top 10 models in Europe and is the only model to experience an increase in sales during May

The impact of economic uncertainty on new car sales can still be seen in key European markets such as Germany, Italy, France and Spain. However, Great Britain saw an increase in new car registrations up 7.9 percent in May, driven by a notable increase in private new vehicle sales.

Among the top 10 brands by volume, Renault, Peugeot and Citroen suffered the largest fall in sales during May, down 15.6 percent, 17.3 percent and 19.8 percent, respectively. The significant decline in the sales volume of these French brands can be attributed in large part to their heavy exposure in Southern Europe, which has been hit hardest by the European economic crisis. Volkswagen remains Europe’s top brand and ahead of Ford despite a decrease in sales last month.

Audi is the only brand to record an increase in sales within the top 10 brands in Europe, up 4.5 percent in May and 4.4 percent YTD, thanks to the new Q3 model and improved A6. Mercedes recorded a slight decrease in sales in May, down 0.5 percent, but models such as the new A-class and new B-class had strong local sales in Germany.

Outside the top 10 brands, Land Rover continues to perform well with sales increasing by 54.7 percent in May helped by the continued success of the Range Rover Evoque. Kia also recorded a 22.9 percent sales increase during the same period boosted by strong sales of the Rio last month.

Despite a significant reduction in May sales, Volkswagen’s Golf, down 13.5 percent, and Ford’s Fiesta, down 12.4 percent, retain first and second place in the top 10 models sold in Europe.

New to the top 10 models list this year, Renault’s Megane is the only model to see an increase in sales last month, up 2.6 percent, fuelled by strong sales in France, Spain and the Netherlands. Achieving 21,817 sales in May, Megane claimed seventh place ahead of the Renault Clio, Fiat Panda and Volkswagen Passat.

Outside the top 10, the Toyota Yaris, Audi A6 and Mercedes B-class recorded significant increases in sales during May. New models such as the Volkswagen Up, Audi Q3 and Peugeot 208 also had solid sales last month. Commenting on the findings, Gareth Hession, vice-president, research at JATO said: “It’s encouraging to see that new models from Volkswagen, Audi and Peugeot sold well last month. Clearly car buyers still appreciate innovation and will continue to invest in new and improved vehicles despite the ongoing European economic uncertainty.”