PARIS -- Passenger-car sales have plunged in the central European countries that joined the EU on May 1.
In Poland, central Eu-rope's largest passenger-car market, sales dropped 21.3 percent to 23,193 units in June compared with the same month last year.
Overall new-vehicle sales in central Europe declined by 10.1 percent to 68,854 units in June compared with the same month in 2003, according to figures released by ACEA, the European car manufacturers association.
Peugeot Managing Director Frederic Saint-Geours says sales declined in the new EU-member countries because many customers thought they would save money by buying their new cars before the May 1 accession.
"The perception that there would be an increase in car prices after joining the EU prompted people to move up the time of their purchases," he says.
Francois Hinfray, Renault's sales and marketing chief, says new-car prices in central Europe will inevitably rise to levels similar to those in western Europe.
Hinfray says that the EU's block exemption regime for new-car sales and repairs, which encourages price harmonization across Europe, will speed up the trend.
"We will have to take into account Europe as a whole when setting our prices in the east," he said.
Central and eastern Europe are important markets to the French automakers.
Peugeot parent PSA/Peugeot-Citroen sold 86,920 units in those markets in the first half, 5 percent of its global sales total for the first six months.
The regions accounted for 8.4 percent of Renault's global sales of 1.3 million units during the first half.
New-vehicle sales surged 40.8 percent in March in Poland compared with March 2003 as consumers rushed to buy new cars before EU-inspired tax changes came into effect. The changes in Poland's value-added tax law have made it harder for customers to claim tax refunds.
Despite recent sales declines, Po-land's first half sales are up 12.5 percent to 171,349 units from 2003.