FRANKFURT -- New car sales in western Europe fell 1.3 percent in May, nipping April's slight gain in the bud, industry data showed on Wednesday.
New car registrations slipped to 1.22 million in May, keeping performance this year patchy despite the second strong month in a row in Germany, the continent's biggest car market by far, plus solid numbers in France and Spain.
Germay's BMW and South Korea's Kia Motors strongly outpaced the market again, while Italy's struggling Fiat was hit especially hard by a strike of car transport truckers. Its group registrations fell by just over a quarter.
France's PSA saw sales edge 0.1 percent higher, providing its first advance in market share this year.
Figures compiled by Brussels-based car industry group ACEA showed registrations in the 15 older European Union members plus Norway, Switzerland and Iceland contracted 1.4 percent in the first five months of 2005 to 6.34 million cars.
Including the new EU members except Malta and Cyprus, registrations slipped 1.7 percent in May and fell 2.4 percent in the first five months amid surging used car imports to Poland.
"While the month had one more working day in almost all countries, the May figure was heavily influenced by the significant drop in Italy due to the one-month long strike of car transporters, which disrupted delivery of new vehicles," ACEA said in a statement.
Car sales in Europe got off to a dismal start in 2005, snuffing out a late 2004 rally that was powered by sales incentives and extra selling days. April was the only month so far to post a year-on-year rise.
"I don't think the worst is over. There is just no growth in Europe," General Motors Europe Chairman Fritz Henderson told Reuters last week, noting sluggish economic growth was hampering consumer spending and keeping pressure on prices even though some eastern European markets showed promise.
German investment advisers Helaba Trust said: "If the dollar does not continue to appreciate against the euro, car stocks could be in for an uncomfortable autumn."
SQUEEZE IS ON
Slack sales are squeezing carmakers already pinched by a strong euro, high raw materials prices and excess capacity, but the dollar's climb and softer steel prices offer some relief.
Carmakers hope a raft of new models will lure more buyers into showrooms as the year goes on.
The auto industry accounts for around 3 percent of western Europe's economic output and 7.5 percent of its manufacturing base, ACEA says, so robust car sales also help spur economies.
Volkswagen's group registrations rallied 5.3 percent in May, boosting its western Europe market share to 19.4 percent, aided by strong showings at its Audi luxury arm and Czech-based entry-level brand Skoda.
PSA's share inched up to 14.3 percent from 14.1 in May 2004 even though it has been scaling back unprofitable business.
BMW boosted group registrations 22.5 percent, keeping its western European market share above that of Japan's Toyota Motor Corp., the world's second-biggest carmaker.
BMW is pushing the biggest new product offensive in its history, including its well-received 1-Series compact, X3 mid-sized offroader and revamped 3-Series sedan.
This has let it overtake DaimlerChrysler's Mercedes Car Group as the world's biggest maker of premium cars. DaimlerChrysler registrations fell 10.5 percent in May, led lower by a 12.8 percent decline at flagship Mercedes-Benz.
Despite record sales, BMW has forecast only flat 2005 earnings given the strong euro and high prices for raw materials such as steel and plastics.
South Korea's Kia once again led growth by all manufacturers, with registrations leaping 49 percent last month. Its market share rose to 1.4 percent from 0.9 percent a year earlier. Its parent Hyundai put its market share above 2 percent by generating 8.8 percent more registrations.
Other Asian carmakers turned in mixed showings.
Toyota's registrations, including its luxury brand Lexus, gained 2.8 percent, lifting its market share to 5.1 percent.
Mazda sales shrank 12.5 percent, but Nissan and Mitsubishi got more market share.
General Motors, the world's biggest carmaker, kept its market share steady at 11 percent as weaker Saab numbers offset gains by its Opel/Vauxhall brand. That put GM just behind Ford's 11.2 percent share after a 2.7 percent sales drop.
Both big U.S. carmakers have slashed their 2005 earnings forecasts as they lose domestic market share to foreign rivals and face mounting costs for raw materials and health care.