Car sales in Europe get late-year boost helped by incentives

Car sales in Europe get late-year boost helped by incentives

Europe emerged as a bright spot for the embattled global car industry after car sales jumped to a record in December, but it could be short-lived.

The “exceptional” gain in Europe last month was fuelled by a 28% increase in France and a more than doubling in Sweden, where governments changed emissions-based taxes on new cars starting in 2020, the  European Automobile Manufacturers’ Association said.

Car registrations rose 21% to 1.26 million vehicles, as the late surge helped offset a weak start to 2019 and pushed full-year sales 1.2% higher, reversing a slight drop in 2018.

Sales also more than doubled in the Netherlands ahead of an increase to 8% from 4% in the tax rate for electric company cars.

By pulling forward buying, the changes could sap demand heading into 2020.

Europe’s growth contrasts with weak demand in China where sales fell 3.6% in December. 

French carmaker PSA said global sales fell 10% last year to 3.49 million units, compared with a record 3.88 million in 2018, as it suffered from declining volumes in China, the Middle East and Africa.

In Europe, the Peugeot maker’s sales declined by 2.5% in 2019 to 3.11 million vehicles, with its Opel-Vauxhall brand suffering the steepest fall, down 6.4%.

PSA was outperformed by VW and Renault in Europe.

Bloomberg and Reuters

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