High unemployment takes its toll on European car sales

Press Release   •   Jul 16, 2013 10:08 BST

UK car sales rose 13.4 percent in June, in contrast to other European markets which fell as high unemployment rates took its toll.

New car sales in Europe suffered their worst June since 1996 with demand falling to 1.134 million vehicles, down 5.6 percent from the same month last year.

The unemployment rate was 12.2 percent in the euro area in May, and was probably at that level for the entire second quarter.

Executives at Peugeot and French competitor Renault SA (RNO) reiterated predictions this month that the region's car market will fall 5 percent in 2013 in the sixth annual drop.

European car sales have seen an almost uninterrupted fall for two years, due mainly to recession in the eurozone. They saw a small rise in April, but that was followed by a big fall in May.

The figures relate to the 27 countries in the European Union plus those in the European Free Trade Association.

Four of Europe's five largest automotive markets shrank last month, with deliveries in Germany, the biggest, dropping 4.7 percent, and demand falling 8.4 percent in third-ranked France.

Winners in June included Seat, with sales up 12.2 percent, and Renault-owned Dacia, up 17 percent.

Among luxury carmakers, Mercedes sales bucked the market decline again with a 2 percent monthly gain. BMW fell 7.7 percent, and VW's Audi dropped 8.9 percent.

With car sales falling to a 17-year low in 2012, European carmakers cut both prices and manufacturing capacity but they have largely failed to arrest the decline.

For more information on the automotive market, see the latest research: Automotive Market Research

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