European Auto Sales Leap to Nine-Year High as Renault Gains
Customers inspect the interior boot space of a fresh Renault Megane automobile for sale inwards a Renault SA dealership in Madrid.
Photographer: Angel Navarrete/Bloomberg
European car sales rose to a nine-year high in 2016, with French manufacturer Renault SA taking advantage of recovering request and Volkswagen AG’s tarnished reputation to leap to 2nd place from third in the region.
Industrywide registrations enhanced 6.Five percent to 15.1 million vehicles, the highest level since the two thousand seven peak, the Brussels-based European Automobile Manufacturers’ Association, or ACEA, said Tuesday. Regional leader Volkswagen lost market share with a Trio.Three percent sales build up as request at its namesake brand declined amid the fallout of the emissions-cheating scandal.
Renault’s deliveries surged twelve percent by wooing buyers with an updated lineup including a fresh Megane hatchback, helping it shove past French rival PSA Group. Fiat Chrysler Automobiles NV was the fastest growing major carmaker last year with a fourteen percent build up on request for Jeep models.
“Customers shifted from Volkswagen to other mass manufacturers, such as Renault and Fiat Chrysler,” said Commerzbank analyst Sascha Gommel. “The main reason Renault sold more cars has do with its product cycle. They have a very youthful portfolio.”
Growth Slowing
The car industry’s European sales growth last year marked the third annual build up since a two-decade low in two thousand thirteen caused by the global recession and regional debt crisis. Further expansion will very likely slow sharply, as most consumers who waited to make big purchases now have fresh vehicles and the fallout from the Brexit vote menaces to erode U.K. request.
The region’s auto market is set to display “far more modest” growth this year, with request plane in 2018, said Ian Fletcher, an analyst at research company IHS Markit. “Brexit is likely to begin becoming a factor over the next duo of years.”
Europe also faces a structural shift that’s likely to prevent sales from returning to the two thousand seven peak for the foreseeable future. Youthfull, urban residents are increasingly looking for alternatives to vehicle ownership, such as car sharing.
Renault widened its market share to Ten.1 percent, overtaking PSA, the Paris-based maker of Peugeot, Citroen and DS cars, which slumped to 9.7 percent. While PSA is narrowing its lineup to boost profitability, Renault  said sales were up in every European country, mainly due to fresh products such as the Espace crossover, the Talisman sedan and the Megane.
The French manufacturer expects sales of its namesake Renault brand and the budget Dacia nameplate to grow further this year amid expanding request in India and China. Renault’s worldwide sales rose thirteen percent in 2016, compared with Four.6 percent across the sector.
Volkswagen, which is in the midst of a recall of rigged diesel cars in Europe, remained on top of the European rankings at 24.1 percent of cars sold in the region in 2016, compared with 24.8 percent the previous year. The company managed to pare the decline thanks to a 2nd consecutive monthly market-share build up in December.
Brexit Lag
The U.K. posted the slowest build up of Europe’s five fattest car markets, rising Two.Trio percent in 2016, and this year is likely to get worse. Request in Britain is forecast to contract as much as five percent as carmakers raise prices in response to the pound’s plunge in the wake of the Brexit referendum and the economy slows, according to research company LMC Automotive. 
Sales across the region will most likely grow 1.8 percent in two thousand seventeen and one percent in 2018, LMC said. The ACEA compiles numbers from the European Union’s twenty eight member countries, excluding Malta, plus Switzerland, Norway and Iceland.
“The market is still growing, but a little more leisurely,” said Jonathon Poskitt, an analyst at LMC.
— With assistance by Ania Nussbaum