While the US auto industry is already thriving, the battered and bruised European counterpart is only now seeing the light of day – with car sales in 2014 soaring for the first time since 2007.
The new car registrations have been very close to fulfilling the top end of industry executives’ predictions as European buyers seek to replace aging models with more affordable vehicles introduced by global powerhouses such as Renault SA and Volkswagen AG. According to the Brussels-based European Automobile Manufacturers’ Association, or ACEA, deliveries across the continent climbed 5.4 percent to 13 million cars – by comparison growth forecasts made late last year ranged from 2% (PSA Peugeot Citroen chief executive Carlos Tavares) to 6 percent – predicted by Renault boss Carlos Ghosn. Back in 2013 a two-decade low sales quota was reached by the European market after a six-year slump in demand and demand in 2014 was buoyed by the low-cost Renault SA Dacia brand and Volkswagen’s own affordable Seat and Skoda subsidiaries.
Because the signs of economic expansion for the countries in the euro zone are beginning to disappear once more, automakers also took the measure of further driving down profits with additional price cuts during the final months of 2014. Analysts point out that 2014’s figures are way off from the improvements seen during the hey days of 2006-2007 and 2015 would continue the story of a cripplingly slow recovery. ACEA’s figures have compiled statistics from the 28 European Union countries, excluding in the process Malta, Switzerland, Norway and Iceland. December sales rose 4.9 percent to 997,238 autos for the 16th consecutive monthly gain.