European car market begins rebound as economy improves

Renault Fluence

The European car market is showing the first signs of improvement as a recession ends in the 17 countries using the euro and deliveries in key regional markets begin to improve.

Ford Motor Co.'s deliveries last month in its 19 main European markets increased 9 percent from a year earlier to 90,000 cars, the company said today. "The worst is over," Roelant de Waard, head of sales and marketing for the Ford of Europe division, said in a phone interview on Wednesday from the unit's headquarters in Cologne, Germany. "It's a bit early to say that we're now on a way up. Certainly the outlook has improved."

In July, new-car sales rose 2 percent in Germany and 1 percent in France. Both the UK and Spain reported double-digit rises at 13 percent and 15 percent, respectively. Even the monthly decline in Italy was the smallest this year, following a drop across the region in June to the lowest demand since 1996.

Gross domestic product in the euro area rose 0.3 percent in the three months through June, led by expansions in Germany and France, ending a six-quarter streak of contractions, the European Union statistics office in Luxembourg said on Wednesday.

Even so, new-car sales in Europe, including the non-EU countries of Switzerland, Norway and Iceland, are still projected to reach a two-decade low for the full year in a sixth annual drop.

"Markets are stabilizing in Europe and we will see some positive numbers in the second half," Christoph Stuermer, a Frankfurt-based analyst at analyst IHS Automotive, said today. "The second half of the year will be better than the first as markets are bottoming out, yet the total year will remain negative."

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