Globalization be damned; customers in European countries continue to favor their home-grown brands.
That's why Germany and Italy have been Europe's strongest major-market performers this year. The resurgence of Volkswagen AG and Fiat Auto has boosted their respective home markets.
VW group sales in Europe were up 9.6 percent in March and 12.5 percent for the first three months, compared with the same periods of 2005. VW-brand sales are up even more - 13.5 percent for the month and 17.8 percent for the first quarter of 2006, to 416,243.
VW's revival helped drive up overall sales in Germany 6.9 percent for the month to 358,072. For the quarter, sales were up 5.4 percent to 797,143 units.
Buoyed by the hot-selling new Punto small car, Fiat has continued its strong upward surge. Sales of the Fiat brand shot up 28.3 percent in March to 98,340 units. For the quarter, the brand was up 23.6 percent to 251,143 units.
Italy, Fiat's home market, likewise performed strongly. It rose 8.6 percent in March to 250,328 and 9.0 percent for the quarter to 700,027.
Walt Madeira, manager of European sales forecasting for CSM Worldwide in London, says Germany should continue strong through the year. Madeira says customers will rush to buy vehicles before 2007, when a new value-added-tax increase kicks in.
General Motors and Ford Motor Co. were virtually flat in Europe. GM was down 0.2 percent for the quarter and Ford 0.3 percent. Luxury brands were the leaders for both.
Saab has been GM's strongest performer this year, up 27.7 percent for the quarter to 24,350 units. Land Rover has paced Ford, with sales up 18.6 percent to 24,868 units.
BMW stalks Mercedes
BMW keeps edging closer to Mercedes-Benz for leadership in the luxury segment. The BMW brand grew 10.4 percent for the quarter to 174,868. Mercedes, showing signs of recovery, grew 9.0 percent to 179,528 for the quarter.
Audi finished third with 161,497 for the quarter, up 4.9 percent from the same period last year.
The growth of Japanese and Korean carmakers slowed. Nissan Motor Co. actually lost ground for the quarter, down 14.4 percent to 82,668 units.
Toyota Motor Corp., encompassing the Toyota and Lexus brands, was up 1.8 percent for the quarter to 229,705 units.
Kia, until recently Europe's fastest-growing brand, slowed to a 6.2 percent increase for the first quarter, selling 57,322 units.
But CSM's Madeira said the Koreans and Japanese remain a force to be reckoned with.
"The Koreans and Japanese are definitely, definitely increasing in Europe, steadily and slowly - not like North America, where they took over the market by storm," he says.
Kia and Hyundai have adapted their products to Europe, Madeira says.
"The designs are not so much Korean anymore," he says. "They have put more of a European flavor into their vehicles."
The United Kingdom remained the weakest of Europe's five largest markets, with sales down 4.6 percent for the quarter. Madeira says U.K. sales may be even weaker than the numbers suggest.
"We think a lot of manufacturers registered vehicles without selling them in order to achieve sales targets," he says. "We expect the U.K. market to fall more than 4.6 percent this year. We expect it to actually fall around 8.6 percent."
You may e-mail Bradford Wernle at [email protected]