LONDON - Shares of European carmakers dropped on Tuesday morning amid fears they were losing share in a shrinking U.S. market and on caution ahead of results from DaimlerChrysler.
U.S. auto sales released overnight showed a slowdown in January from the breakneck pace set a month earlier. Analysts said January's seasonally adjusted annual sales rate came in at about 16.2 million units, well off December's 18.3 million rate.
By 0914 GMT DaimlerChrysler was down 1.2 percent, Volkswagen fell 2.2 percent, Renault eased 0.9 percent and Porsche -- also under pressure from analysts' downgrades -- lost 3.2 percent.
"European automakers have held back on incentives which has resulted in them losing some market share in the U.S.," said one car analyst in London.
Renault slipped after its 44-percent owned unit Nissan Motor Co. Ltd. said its U.S. sales, including its luxury Infiniti division, were up a tepid 1.2 percent.
Volkswagen, Europe's leading carmaker, said its U.S. sales fell 16.6 percent to 17,811 vehicles in January, including its upscale Audi brand. Apart from weak market conditions, VW blamed its decision not to match deep discounts from other automakers.
Porsche saw its U.S. sales fall by 9.4 percent to 1,345 vehicles.
Analysts also were nervous about high inventory levels.
"Supply levels among European carmakers are moderately high given the uncertain economic conditions and geopolitical factors," said Xavier Gunner, a car analyst at UBS Warburg.
DaimlerChrysler's U.S. unit, Chrysler, said late on Monday that it was raising consumer incentives after an 11.7 percent drop in its January U.S. auto sales and following similar moves by General Motors and Ford last week.
"DaimlerChrysler's sales were much weaker than the decline in the whole market which was not very encouraging," said Christian Breitsprecher, an analyst at Deutsche Bank in Frankfurt.