Two venerable German brands that had been suffering recently -- Mercedes-Benz AG and Volkswagen AG -- are showing signs of recovery in a flat European market.
Sales in the 26-nation European market slipped 2.6 percent in October from a year earlier to 1.165 million units.
The market was weighed down by a slowdown in the United Kingdom after three record years and weak demand in Poland, where new-car sales have been hurt by a flood of used cars.
With the October decline, year-to-date European sales are off 0.3 percent, according to the European carmakers' association.
Mercedes-Benz sales were up 8.8 percent in the month, to 62,840 units. Volkswagen brand sales climbed 6.7 percent to 134,178 units, the trade group reported. Mercedes-Benz was aided by model debuts, including the B class and S class, which brought customers into showrooms.
VW's gains were more a consequence of a potentially significant adjustment in its pricing strategy, said John Lawson, analyst for Citigroup in London.
"They seem to be putting more of their cost savings back into the market," said Lawson. "They're prepared to be a little more price competitive than they were."
In recent years, VW has worked hard to position itself as a near-premium brand in Europe's brutally competitive volume car market.
This year, VW knocked France's Renault SA off its perch as the top-selling brand in Europe, a status the French brand enjoyed in 2004.
Renault's decline accelerated in October, when sales fell 13.1 percent to 112,003 units.
Renault has not yet seen the benefit of the just-launched Clio 3 small car, and the Megane lower-medium car is past the peak of its cycle, Lawson said.
Among other volume brands, Fiat Group and General Motors were the biggest losers, although "Fiat seems to be stabilizing," said Nigel Griffiths, analyst for Global Insight in London.
Fiat brand was off only 3.4 percent for October but is down 16.3 percent for the year to date. GM dropped 6.1 percent in October, pulled down by a 7.2 percent decline at Opel/Vauxhall, its mainstream European unit.
Despite the launch of the new 3 series, BMW was down 9.7 percent for the month, but it remains up 13.0 percent for the year.
Kia, up 17.8 percent in October and 52.8 percent for the year, remained Europe's fastest-growing volume brand.
Honda, up 17.6 percent, had the strongest month among Japanese brands.
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