Car sales in the US, Europe and Japan stayed stuck in low gear last month, while emerging markets like India raced ahead.
The loss of government incentives to buy new cars in Europe and Japan led to steep sales drops from a year ago, but US sales bounced back from unusually low levels in September last year, the month after the US’ “cash for clunkers” program expired.
The global auto industry’s recovery from the financial crisis has been patchy and largely reliant on growth in countries, such as China and India, as well as government subsidies and incentives to revive demand.
India’s top automakers reported strong sales last month, fueled by the country’s robust economic growth, but car sales in Japan fell for the first time in 14 months last month after government incentives dried up.
“Overall, I am not that pessimistic about auto demand worldwide,” said Lee Sang-hyun, an analyst at Seoul-based NH Investment and Securities Co Ltd.
“Although demand in the US and Europe is sluggish, sales are growing in emerging markets,” Lee added.
In France, sales of new passenger cars fell 8.1 percent last month, while Italy’s new car sales fell 18.9 percent as the loss of incentives to buy less-polluting cars weighed on demand.
In Korea, Hyundai Motors Co saw year-on-year sales growth of 1.8 percent last month
Hyundai, the world’s fifth--largest carmaker along with its affiliate Kia Motors Corp, benefited from Beijing’s subsidies for fuel-efficient models in China, while its Sonata sedan posted strong sales in the US, analysts said.
Leading US carmakers all reported double-digit percentage gains from a year ago, but industry-wide sales last month fell 4 percent from August.
General Motors Co posted a year-on-year sales gain of 10.5 percent, while Ford Motor Co reported a rise of 46 percent and Chrysler Group LLC said its sales jumped 61 percent.
At the Paris Auto Show this week, top carmakers let cautious optimism creep into their outlooks as they looked to emerging markets to dispel the dark clouds over Western economies.
Fiat Group SpA chief executive Sergio Marchionne said the Italian carmaker expects to report a net profit this year as good sales in Latin America this month helped offset weaknesses in Italy and elsewhere in Europe.
The European sales chief for Volkswagen AG, Europe’s biggest carmaker, forecast the global car market will grow by 6 percent to 7 percent this year.
Sales at India’s top automakers remained robust last month, up as much as 30 percent on a year ago and showing no signs of slowing.
However, Japanese sales, after holding up surprisingly well in August, fell 4.1 percent excluding 660cc minivehicles, the Japan Automobile Dealers Association said.
Sales in Japan are expected to come under further pressure after the government stopped accepting applications for its green-car subsidy program last month.
Toyota Motor Corp had been a big beneficiary of the program, particularly with sales of its hybrid flagship Prius. However, Toyota’s domestic dealership orders fell more than 40 percent last month after funds allocated to the cash-for-clunkers scheme were almost exhausted, the Nikkei business daily reported.
Christopher Richter, an auto analyst at CLSA Asia-Pacific Markets in Tokyo, expected the pattern in Japan to be a repeat of what had happened in Germany — a period of good sales followed by some very poor sales.