Europeans deliver best investor returns in '12

Despite economic uncertainty and restructuring in their home markets, European automakers and suppliers delivered the best shareholder return in their industry segments last year.

Volkswagen AG of Germany provided the best value of any automaker for the 12-month period that ended Dec. 31, 2012, returning 64.5 percent to investors, according to the latest Automotive News/PwC Shareholder Value Index.

Two other European automakers were hard on VW's heels. France's Renault came in a close second for the year, with a shareholder return of 60.4 percent. And BMW of Germany tipped in at No. 3 for the year, with a 49.1 percent 12-month value increase.

The shareholder value leaders in the automaker, supplier and retailer sectors for 2012 were honored with awards at the Automotive News World Congress.

Total shareholder value for the awards is a calculation of how the value of $100 invested in a public automotive company changes during the period, counting share price -- adjusted for any stock splits -- and assuming any dividends are reinvested.

BMW gave shareholders the best return for any global automaker over the past three years ending Dec. 31. BMW investors saw a 125.6 percent payback on their investment for the period. By comparison, the automaker segment as a whole averaged a 40.2 percent increase for the three-year period.

The European market has been under a pall for the past year. New-vehicle sales across the continent fell by almost 8 percent from 2011 levels. The steep gains in investor returns for Europe-based automakers are a testament to their global diversity, said Jeff Zaleski, U.S. automotive transaction services partner in PwC's automotive practice.

'Remarkable' returns

"It's remarkable that these two German companies have done so well, considering the situation of the European economy in the past year," Zaleski said. "They have excelled despite the turmoil.

"Volkswagen has been a powerful global player, with particular success in expanding sales in China in recent years. They now have a very rich portfolio of popular cars on the streets around the world," he said.

"BMW has really shown an outstanding performance in the U.S. market," he added. "They've pushed themselves to be a market leader in new technologies in powertrains and performance. Consumers are responding to that."

The year produced gains for almost all global automakers. Only PSA Peugeot Citroen of France declined in 2012, posting a 47.2 percent decrease in shareholder value, according to the index. The company, which relies heavily on European vehicle sales, suffered a 16 percent global sales decline in 2012.

Europeans lead suppliers

Two European firms also topped the index among global parts suppliers.

Continental of Hanover, Germany, led the segment for 2012, chalking up an 89.7 percent shareholder return. Continental makes tires, automotive electronics and other components.

Plastic Omnium Co., of Levallois, France, dominated the segment's return for the index's three-year period. The company, which supplies fascias, front- and rear-end modules, fenders, body panels and fuel systems, delivered a 256.5 percent return for the period, compared with an average 43.3 percent for the rest of the global supplier industry.

The index also showed that Lithia Motors Inc., of Medford, Ore., created the highest shareholder value of any publicly traded auto retailer in the industry, for both the past 12 months and the past three years.

Lithia, which owns 87 stores in 11 states, gave investors a 74 percent increase in value in 2012, and a 377.1 percent increase over the past three years.

The sharp three-year performance reflects Lithia's efforts to strengthen parts and service operations at its stores after the 2009 economic crisis. Lithia's stock price has been on a fairly steady climb since the middle of 2010.