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Volkswagen scandal strongly impacts European car market

Volkswagen scandal strongly impacts European car market
Nikhil Puthran Nikhil Puthran Wednesday 18 November 2015, 17:00 PM

PTI revealed that the European car market growth slowed in October, the European Automobile Manufacturers Association (ACEA) stated, as the Volkswagen emissions scandal took its toll on auto sales. Passenger car registrations were up by just 2.9 per cent from October 2014 in the EU, a sharp slowdown from the 9.8 per cent rise reported in September. "October marks a break in the trend," said Flavien Neuvy, head of Cetelem's automobile research division.

"The Volkswagen affair may have caused collateral damage. We can't rule out that the size of the scandal has been such that drivers have canceled or postponed purchases," he told AFP. Deliveries of Volkswagen group cars were down by 0.5 per cent in October, but the German manufacturer remains European leader with a market share of 25.1 per cent. The carmaker said last week sales of VW brand cars worldwide fell by 5.3 per cent in October, as it halted deliveries of some diesel models it has admitted violate pollution standards.

"Demand for new passenger cars saw momentum slowing down in all major markets," the ACEA noted. The UK market, Europe's second-biggest, actually shrank, by 1.1 per cent, in October. Other markets kept growing, but less so than in recent months. The German market rose by 1.1 per cent, France by 1.0 per cent, Italy by 8.6 per cent and Spain by 5.2 per cent. Despite the October downshift, the figures still confirmed an upward car market trend that has been unbroken for 26 months, the ACEA said.

A total of 1.1 million new cars were registered across Europe in October. Despite the sudden slowdown, October figures have put no more than a dent into the car market's performance for all of 2015. For the first 10 months of the year, registrations were up by 8.2 per cent, translating into 11.5 million new cars on European roads. Over that period European champions were Spain, up 20.5 per cent and Italy, 14.7 per cent higher, with both countries "benefiting from economic recovery and relatively low base comparisons".

The UK market was up 6.4 per cent in the 10 months to October, France 5.7 per cent higher and Germany up 5.1 per cent. Jean-Francois Belorgey, auto expert at consultants EY, said the release of November figures should give "a much clearer idea" on the lasting impact of Volkswagen's emissions scandal because VW was still delivering cars ordered before the scandal broke. "They had a very big book of orders which they are now delivering," he said.

 

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