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J.D. Power Automotive Forecasting surveys July’s European new car markets
New car registrations across the 17 EU and EFTA countries of Western Europe last month fell by 3.5% year on year to 1,183,919 units, according to J.D. Power Automotive Forecasting reporting on 4 August; few markets performed well and seasonally adjusted annualised sales fell sharply. New car sales in France, Spain and Italy were weak in July as payback from June promotional activity, and even the weather, weighed on the market. The German market also showed signs of weakness. By comparison, the UK market, reported today by the SMMT, while far from impressive, was at least relatively stable, says J.D. Power Automotive Forecasting.The striking peak and trough pattern of 2005 was expected to diminish in 2006 as car manufacturers reduced incentives as a result of action on inventories and overproduction, but the spike in June and trough in July tells J.D. Power that supply-side pressure is beginning to mount again in the face of uncertain demand for new cars.
But on balance, the poor July result, when taken together with the good July figure, is not yet a cause for serious concern and a slight increase in the West European market remains the firm’s core assumption.
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