Auto stocks sink as credit crunch hits car buyers
LONDON (Reuters) - Shares in European automakers fell sharply on Wednesday as signs that consumers are struggling to raise loans to buy cars fed into a market spooked by concerns about earnings targets at leading manufacturer Daimler.
Despite denials of a profit warning from the Stuttgart-based company, its share price extended already steep declines, while data from German rival Porsche suggested even the luxury end of the market is no longer immune from the global economic downturn.
Concerns about a consumer funding logjam in the United States were highlighted on Tuesday by the head of top dealership AutoNation Inc.
Mike Jackson said even prime borrowers looking to buy cars and trucks were failing to secure loans, impacting sales volumes in the world's biggest car market by up to 20 percent.
"The banks are looking for every excuse possible to say no and they are saying no to good customers ...
U.S. sales data due Wednesday is expected to show unit volumes in the industry declined in September to close to a 15-year low.
"The statements from AutoNation add to pressure which could already be seen yesterday from a broker note from Merrill Lynch on Daimler and BMW that also addressed credit-related problems for carmakers," a Frankfurt-based trader said.
Auto stocks dominated the list of European blue-chip decliners, led by Daimler, which continued to fall despite denying rumors of a profit warning, saying it would give its next outlook with third-quarter results on October 23.
At 5:46 a.m. EDT, Daimler shares were down 9.42 percent at 32.11 euros. Among other leading car makers, Volkswagen fell 5.22 percent, Renault 4.78 percent and Peugeot 5.33 percent.
Trading in Fiat was halted after excessive losses, with the share indicated down 5.73 percent.
Among second-liners, Porsche was down 9.5 percent after the sports car specialist reported a modest 1.2 percent rise in unit sales in the year to July and declined to give a forecast for the current year, pledging to adjust its production to meet a possible slowdown in demand.
(Reporting by John Stonestreet; Editing by Quentin Bryar)
