RPT-UPDATE 2-European car sales fall again in February as austerity bites

Tue Mar 19, 2013 12:27pm EDT

* Sales overall down 10.2 percent to 829,359

* Slowest Feb since ACEA started compiling figures in 1990

* Ford sales drop 20.8 percent to 53,660 cars

* GM, Fiat next biggest fallers

By Jennifer Clark

MILAN, March 19 (Reuters) - Europe's car sales fell last month to their lowest February level in at least 23 years, industry figures showed on Tuesday, dwindling to the sort of trickle usually only seen during the August holiday when cities are empty.

New car registrations shrank 10.2 percent to 829,359 in the month compared with the year before, according to the Association of European Car Manufacturers (ACEA). It was the slowest February since ACEA started compiling figures in 1990.

After yearly sales slumped 8.2 percent to a 17-year low of 12.05 million vehicles in 2012, this year is already shaping up to be another tough slog, particularly for mass-market carmakers as consumers in recession-hit European economies postpone purchases.

Ford Motor Co has been one of the biggest casualties, with sales dropping at twice the rate of the overall market's decline for a third straight month. Its sales dropped 20.8 percent to 53,660 cars.

Ford is cutting back its European production capacity with three plant closures, including its Genk factory in Belgium, to stem regional losses.

General Motors Co and Fiat SpA were the next biggest fallers, dropping 20.1 percent and 15.7 percent respectively.

Carmakers in Europe are still reeling from a poor 2012, during which mass-market manufacturers lost an estimated $7 billion in the region, Fiat Chief Executive Sergio Marchionne said at the Geneva car show this month.

CONTAGION SPREADING

"The recession and the car market slump is impacting the countries most exposed to the dictates of austerity, but the contagion is spreading to the entire eurozone," said Italian automotive research group Studio Promotor in a statement.

Market forecaster LMC Automotive recently estimated this year's sales would drop 3.1 percent in western European to 11.4 million vehicles.

With the exception of August 2012 when just 688,000 cars were sold, the month of February was the worst-ever month in absolute terms since 2003, when ACEA figures started to measure 27, not 15, European countries.

European market leader Volkswagen AG saw sales of its core VW brand fall nearly 10 percent and its luxury Audi brand decline 3.8 percent.

Only three brands managed to add sales in February: Korea's Hyundai Motor Co eked out a 1.4 percent gain, Mazda Motor Corp rose 13.1 percent and Honda Motor Co Ltd 27 percent.

Another bright spot was Britain, where sales rose 7.9 percent.

"All other significant markets faced a downturn, ranging from 9.8 percent in Spain to 10.5 percent in Germany, 12.1 percent in France and 17.4 percent in Italy," ACEA said in a statement.

Analysts at Citi noted: "The German drop is worrying as it comes amidst the new launches like new A-Class and new VW Golf."

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