The demise of the European car market

Europe’s worsening economic situation is reflected by many things: unemployment, social unrest, tight national budgets and so on. Because this is a car blog, what matters here are new car sales, and this year they’ve been appallingly low. All the big European car manufacturers are posting record dips in sales, except for one: BMW, who have seen a 10% increase in cars coming out of their showrooms.

Renault have sold a staggering 29% less, Fiat are 19% down, Volvo slumped 17%, General Motors and Ford lost around 15%, and curiously, PSA Peugeot-Citroen, a group in the news lately for their poor financial performance and their dubious alliance with GM, lost just over 8%, practically the same as that of the VAG group of brands owned by Volkswagen. Daimler-Benz, of which Mercedes is a part of, saw nearly a 7% loss, most of which can be attributed to the slump of Smart.

In the European Automobile Manufacturers’ Association report, the reader can note an odd tendency: there’s a tendency for European-based manufacturers of more affordable cars such as superminis and family hatchbacks to have registered a heavy loss (GM and Ford may be American, but their European models are conceived and built here). On the other hand, Audi was up 1.4%, Jaguar Land Rover rose a staggering 13.2%, and as mentioned, BMW got an extra 10.5%. Really shows who’s suffering and who’s benefiting from the current recession!

In the long term, I’m worried this could mean Europe’s non-German car-makers disappearing altogether. It doesn’t seem to matter how well traditionally widespread brands like Fiat and Renault make their cars, they just can’t compete with the badge-conscious, overpriced German offerings. If these sorts of brands go under, anyone who wants a frugal small car will either have to buy a bland Japanese vehicle or a Volkswagen in one of its guises (Seat, Skoda, etc.). Or we could see a BMW-owned Citroen for example, since the only real small car the Bavarians make is the Mini and all of its bastard sprogs.

Either way, dark days are ahead for everyone on the Old Continent.

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