Europe's passenger car registrations rose 4 percent in May as growing consumer confidence encouraged purchases of new models. Volume brands such as Renault, Peugeot, Opel and Skoda gained sales while Ford Motor, Fiat and Hyundai lost ground.
Registrations in the EU and EFTA markets increased to 1.13 million vehicles from 1.09 million a year earlier, industry association ACEA, said. Five-month sales gained 7 percent to 5.62 million cars.
Demand increased for a ninth straight month in May, but the level of deliveries was the second lowest for the month since 2003, ACEA said in a statement today.
"It's a modest recovery from low levels of overall demand," said Marc-Rene Tonn, an analyst with M.M. Warburg.
Demand is set to keep improving during the coming months, said Christian Ludwig, an analyst with Bankhaus Lampe. "After six years of declining auto sales in Europe, there should be significant pent-up demand that should drive growth in the next couple of years."
Analysts said new products are boosting sales at Renault, PSA and Opel. "It is clear that new models and changeover is having an impact with Renault benefiting from new model cadence and both BMW and Daimler suffering some weakness as they see model changeover at Mini and the aging of Smart leaving a negative effect," said George Galliers from International Strategy & Investment (ISI) in an email.
"We expect Renault to continue to take market share in the region, given the relatively youthful profile of its model line-up," Galliers said.