EU car-makers: Production of passenger cars may fall 25%

• Source: xinhua
• [08:31 July 15 2009]
• Comments

European car-makers predicted Tuesday that Europe's passenger cars may fall 25 percent in 2009 due to the financial crisis.

Fleet renewal schemes by some governments have helped segments of the passenger car market in some countries, but failed to boost the overall vehicle demand in Europe, said European car manufacturer association (ACEA).

"While the outlook for the second half of 2009 remains uncertain, current developments imply that production may fall as much as 25 percent over the whole of 2009 for passenger cars, and at least 50 percent for commercial vehicles," the association said.

In the first quarter, production of motor vehicles overall declined by 35 percent to 3.4 million, said the group, as many manufacturers continued to reduce stocks and cut output in light of reduced market demand, van and truck production fell separately by 57 percent and 56 percent to 226,739 and 76,651.

Production of passenger cars dropped by 31 percent in the first three months to 3.1 million, while car sales fell 17.2 percent, it said.

Vehicle output was down 57 percent in Britain, 46 percent in France, 40 percent in Spain, 38 percent in Italy and 32 percent in Germany, according to the association.

Given the importance of automotive for Europe, it is clear that further difficulties for the sector will continue to negatively impact the whole of the economy.

While 2.2 million workers are directly employed in automotive manufacturing, the ACEA report underlined that an additional 9.8 million rely on the industry for their jobs in closely related sectors.

European car-makers generate a turnover of 551 billion euros (about $770.95 billion), total industry exports are worth 77 billion euros and around 381 billion euros in taxes come from motor vehicles in Europe.

($1 = 0.7147 euros)