BRUSSELS -- Car sales in the European Union are expected to grow by about 1 percent in 2017, a sharp slowdown from last year, the European auto industry association ACEA said on Wednesday.
New passenger car registrations rose 6.8 percent in 2016 to 14.6 million vehicles, the highest volume in nine years and the third consecutive year of expansion.
"However, uncertainty is expected to overshadow 2017, when a slowdown in EU car sales is likely with growth at around 1 percent," ACEA said in a statement, citing political developments.
France, Germany and the Netherlands hold elections this year, while Britain is expected to trigger negotiations to leave the EU.
All five major EU markets recorded gains last year, with growth strongest in Italy and Spain. Sales only fell in the Netherlands and, outside the EU, in Switzerland.
Volkswagen brand retained the top spot, although sales of the VW models declined. Renault overtook PSA Group, the maker of Peugeot and Citroen, to take second place in European volume.
ACEA has been cautious in its car sales forecasts in previous years, predicting 2 percent growth at the start of last year before revising it up to 5 percent in June.