New-vehicle sales in western Europe slumped another 14.2 percent overall in August, dragged down by major declines in each of the five biggest countries and comparisons to strong, incentives-fueled sales a year earlier.
The decline, to 664,804 units, brings sales in the 17 markets for the 10 months to 8.79 million, off 2.5 percent from a year earlier, according to J.D. Power & Associates Automotive Forecasting.
The August numbers reinforce a forecast that full-year sales will be down about 7 percent from 2009, to about 12.73 million, the company said.
Sales in Germany, Europe's biggest market and a major beneficiary of government incentives to scrap high-polluting cars in 2009, fell 27 percent vs. August a year earlier.
France, which still has some carryover incentives in place, was off 9.8 percent. But Italy slid 19.7 percent; the U.K., 17.5 percent; and Spain, 23.8 percent, the forecasting firm said.
The sales dip in Italy is causing alarm among the country's dealers.
“This is another very negative result after months of bad results,” Filippo Pavan Bernacchi, chairman of the Italian auto dealers association, Federauto, said in a statement. “More than half of Italian car dealers will report a strong loss in 2010 and many will be forced to close down.”
Underscoring how the incentives have skewed the market, Italy ended its program on Dec. 31 and has faced several months of year-to-year sales drops this year. But Belgium, which never offered buyers incentives to trade in their older cars, is up 25 percent for the month and 17.1 percent year to date.
“The ending of nearly all government scrappage programs reveals the extent of the weakness of true underlying car demand,” the Power report says. “The August seasonally adjusted selling rate stood at just 11.7 million units. That is far from the norm of the last decade of 14.5 million-plus.”
The forecaster notes that first-half sales remained buoyed by left-over incentives in several countries, notably the U.K. and Spain, which will help hold the full-year decline to about 1 million cars, or 7 percent. Absent a severe economic meltdown, the firm says, sales next year are expected to slip by only 1.4 percent, to about 12.56 million units.
At that level, sales will be down 15 percent, or by some 2.5 million units, from 2007, the last time the western European market sold more that 14 million cars and trucks in a year.