FRANKFURT (MNI) – Eurozone new car registrations continued to trend
upward in June, bringing the annual shortfall to its lowest level since
November, the Association of European Automobile Builders (ACEA)
reported on Tuesday.

The number of new car registered reached 913,738 in June, up 8.1%
compared to May’s 845,156, but down 3.9% from last year’s 950,708 level.

With an unemployment rate of 11.1% and rising, many consumers are
worried about their jobs and pessimistic about future family finances.
Plans for major purchases, including autos, are well below average,
surveys by the European Commission show.

New car registrations in Germany rose 2.9% on the year in June to
296,722. Positive labour market developments are bolstering consumers’
willingness to spend, according to the GfK Group. “This reduced fear of
unemployment is improving the planning security of consumers, which is a
key factor for major purchases, in particular,” it said.

In France, 208,909 new cars were registered, down 0.6% compared to
one year ago. Car makers expect a decline of around 10% for the full
year. The looming closure of major PSA assembly line north of Paris has
prompted the government to devise new schemes to prop up sales. A
“strategic plan” to be unveiled July 25 is likely to include incentives
to purchase clean cars, notably by public authorities, and credits for
car buyers.

Italian car registrations fell 24.4% on the year to 128,388. An
ongoing recession and unemployment above 10% do not bode well for a
turnaround in spending in the near term. A recent Istat survey showed
consumer confidence falling to its lowest level since at least 2006 on
the back of a weaker economic climate.

In Spain, registrations fell 12.1% to 73,258. Discretionary
spending here is likely to remain limited as the country suffers through
recession, unemployment climbs closer to 25% and the government pushes
through more austerity measures.

Among smaller Eurozone states, the Netherlands saw the strongest
jump in registrations, with 52% more cars registered compared to last
year. Conversely, Greece led the way in declines, with 43.3% fewer cars
registered on the year. The shortfall in Ireland was also severe, with
42.1% fewer cars registered in June compared to the same month one year
ago. Data for Malta were not available.

— Frankfurt bureau: +49-69-720 142; email: frankfurt@marketnews.com —

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