Ford, Toyota, Peugeot Lead Car Sales in Europe to New Low image

Ford, Toyota and PSA Peugeot Citroen reached a new low last month in European auto sales, starting 2013 with 8.5% decline.

Last month new car sales dropped to 918,280 units in Europe, according to the Association of European Automakers, the lowest level for January since 1990, as unemployment and austerity measures affected consumer spending. Ford, which already announced it will cut production capacity at three plants on the continent, reported a fall of 26% to 61,544 units, while Toyota and Peugeot fell 16% each.

The slide “confirms a weak start to 2013″, Credit Suisse analysts said in a note. “Hopes of an earnings and cash recovery in the second half are misplaced.”

Last year the European auto demand dropped to a 17-year low and it is expected to further drop in 2013, with about 3% to 5% according to most automakers’ forecasts. Analysts believe that the worst is yet to come, as Germany, Europe’s largest auto market, which managed to fight the crisis effects most of last year, is now in sharp decline, with a 8.6% fall last month.

Germane automakers managed to keep their sales at the surface, with VW posting a slight decline of 5.5% and Audi 2.1%, but BMW rising 9.4%. Renault’s low-cost Dacia brand increased 8.5%, but the group still fell 6.1%. Registrations in France dropped 15%, in South Korea increased 7.7% and in Italy fell 12.4%.