Euro auto sales boom

The European car market soaked up 15.1 million cars last year, the highest figure since the heady days prior to the global financial crisis.

In a nine-year high, sales rose 6.5 per cent over 2015 despite the ferocity and uncertainty of the UK's Brexit vote and yet another failed Italian Prime ministership.

While that all sounds cheery, analysts are predicting tougher times ahead this year thanks to Brexit, plus there are worrying signs for the mainstream volume players.

Both the Volkswagen Golf and the Ford Focus hatches are getting squeezed at the top end by crossover SUVs and by Audi and Mercedes-Benz, and at the bottom end by budget machines like the Turkish-built Fiat Tipo and the Dacia range.

While the volume hatch segment rose only 3.9 per cent for the year (to 1.9 million cars), premium compacts jumped 9.2 per cent to 632,000. The Golf was down nearly 50,000 sales on 2015, though a Golf 7.5 facelift is due to be seen next month.

Ford’s Focus has suffered a worse fate, sliding from second in the segment in 2015 to fourth, behind Opel’s Astra and Skoda’s surging Octavia, all despite a 2015 facelift.

Full figures released this week by the industry’s peak body, the ACEA, confirmed that Italy had the strongest sales growth of the established “engine room” markets, with 15.8 per cent over the year, while Spain registered 10.9 per cent, France 5.1 per cent and Germany 4.5 per cent.

The UK, meanwhile, underperformed against the market, growing grew just 2.3 per cent mostly due to Brexit doubts.

Germany remained comfortably the continent’s biggest car market, with 3,351,607 cars, followed by the UK’s 692,786 right-hand drive models, France with 2,015,177, Italy with 1,824,968 and Spain with 1,147,007.

The only markets to record sales drops were The Netherlands, which raised its tax on luxury cars and saw sales fall 14.7 per cent to 382,825, and Switzerland, which dropped two per cent.

The Volkswagen Group clearly won the battle of the sales groups and the individual brands in the EU, moving 3,498,049 cars across its volume and luxury brands for a 3.5 per cent rise over 2015.

Despite its Dieselgate scandal hitting in wave after wave throughout 2016, the Volkswagen brand saw its sales fall only 0.5 per cent to 1,650,473 across Europe.

Globally, the Volkswagen brand’s sales rose 2.8 per cent to end the year with 5.99 million deliveries. Its 14 per cent growth in China (to 2,999,300 cars) more than offset a 35 per cent drop in Brazil, a 7.6-per cent fall in the USA and, worryingly, a 7.2-per cent fall (to 557,800) in its home market of Germany. Volkswagen attributed its domestic performance issues to an extension of leasing terms for the country’s employees.

The Renault Group followed the Germans home, with a booming December and a product onslaught helping it to 1,496,394 sales for the year, giving it 12.1-per cent growth for its Dacia and Renault brands.

Its picture looks even healthier if you add in Nissan’s 535,412 sales for the year, and you could argue that it’s credible to poke Mitsubishi’s 106,681 sales in there, too.

While including the Japanese joint-venture partners would push the Group’s total beyond 2.1 million cars for the EU, it would still be a long way off Volkswagen, the world’s biggest car maker.

The Renault brand’s 1,082,871 sales, pushed by the new Kadjar SUV, the Espace minivan and Megane, were also enough to retain its place as the second-biggest selling brand in Europe.

The other French carmaker, PSA, fell from second in 2015 to third last year, with a 0.2 per cent decline to 1,446,052 sales, dragged down by a 12.7 per-cent drop in demand for DS’s aging line-up, but Citroen also dropped one per cent and Peugeot only grew 1.4 per cent.

Ford also had a quiet year, growing just three per cent to 1,022,272 cars. While that left it as the fourth-largest group in Europe, it was still enough volume to retain its place as the continent’s third-biggest selling brand. Which seems like it might be news to Donald Trump and his team.

Scorching 10.1 per cent growth saw premium group BMW leapfrog volume GM brand Opel (979,427) for fifth, with 987,479 sales in Europe (203,084 of which bore the MINI badge).

FCA rode growth in every brand to fall less than 2000 cars short of Opel to end the year in seventh. Core brand Fiat rose 13.9 per cent, Jeep jumped more than 20 per cent, resurgent Alfa Romeo rose 16.4 per cent and even dead-brand-walking Lancia climbed 9.1 per cent to 67,134 sales (still ahead of Alfa Romeo, incidentally).

Toyota (as a group, including Lexus) was the best of the Asian brands in ninth (618,182 sales after 7.5 per cent growth), followed in order by Nissan, Hyundai and Kia.

Mercedes-Benz just snuck past Audi to claim premium-brand honours, with 807,433 three-pointed stars sold in 2016 (up 14.2 per cent) compared to 803,520 four-ringed badges (up 8.7 per cent). BMW trailed them both with 784,395 sales, while Volvo moved 274,014 cars, Jaguar Land Rover 215,418 and Porsche 66,421.

While BMW’s sales rose by more than nine per cent and JLR’s by 22.8 per cent (with Jaguar booming 69.5 per cent on the back of the XE and F-PACE), Volvo struggled with just 2.3 per cent of growth.