Despite scrappage boost, Ford's Fiesta will not be Europe's No. 1 seller in 2010

A year ago, the Volkswagen Golf was Europe's best-selling car with a comfortable 13,000-unit lead over the Ford Fiesta.

In the first two months of this year, the gap narrowed to just over 5,000 units, with Golf sales up 5.4 percent to 77,206 units compared with the same period in 2009 and Fiesta volume up 17.9 percent to 71,696 units, according to Jato Dynamics.

The Golf is suffering from a weak domestic German market, which was down almost 20 percent in the first two months. VW sells more than 45 percent of the Golf's European volume in Germany.

The Fiesta's buoyant performance in early 2010 is mainly due to strong sales that were driven by scrapping incentives in Italy and UK. Also buyers taking advantage of scrappage bonuses prefer to purchase less expensive, smaller cars so the Golf compact benefits less than the Fiesta subcompact from the incentives.

By the end of this month, scrapping programs will end in UK and the Italian government will stop allowing registrations of vehicles ordered with incentives by the end of last year, so the Fiesta's torrid growth seen in the early part of this year will slow down.

Italy has been a real bonanza for the Fiesta. It was Europe's largest market in the first two months and will keep the lead in March, with record sales projected at about 250,000 units. In the first two months, Ford sold 26,219 Fiestas in Italy, a third of the car's total European sales.

From April, Fiesta sales will slow down both in Italy and UK. Even though the German market will remain weak throughout 2010, the Golf will rebuild its lead comfortably.

The Golf has been Europe's top-selling car five times in the past decade in 2000, 2001, 2004, 2008 and 2009 with Peugeot taking the crown in 2002 and 2003 with the 206 subcomapct and then with its successor, the 207, in 2007. Opel/Vauxhall took the honors in 2005 and 2006 with the Astra compact.

My bet is that 2010 will again be the year of the Golf.

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