Spending those Euros

January 18, 2000

PARIS — A surprisingly strong finish to 1998 saw Europe set a new sales record. Western Europeans bought 14,341,246 units, up 7.0 percent over 1997 and more than 1990's previous record of 13,516,728.

Volkswagen, Renault and Mercedes-Benz each grew more than 10 percent for the year, thanks to strong product.

Volkswagen had a full year of sales of its new Golf, and full production for most of the year. The Golf unofficially reclaimed the title of best-selling vehicle in Europe, after losing it to the Fiat Punto last year and to the Renault Megane in the early months this year.

Renault said that provisional figures that include light commercial vehicles show that Renault brand beat Volkswagen brand for the lead in market share for the first time in 15 years. Renault had 11.0 percent and VW had 10.8 percent of the market. Renault's success came from the Megane Scenic, which has been carving out a new niche all by itself for two years.

It won't last. This month, Fiat is introducing its odd-shaped Multipla, and in the spring, Opel and Vauxhall present their Zafira. Other makers are also developing competitors.

Mercedes-Benz had its A-class on the market all year. The little luxury car was aimed at the Volkswagen Golf, and it is selling well. Mercedes is also sold out of niche products like the CLK and SLK, which helps the bottom line, even though numbers are small.

"European Car Sales-1998"
Group Units Change (%)
All Brands 14,341,246 7.0
Major Groups
Volkswagen 2,588,197 12.9
Japanese 1,695,309 8.8
GM 1,644,801 1.3
Peugeot-Citroen 1,634,103 7.9
Fiat 1,561,984 -1.7
Renault 1,539,974 16.1
Ford 1,456,152 -3.5
BMW 818,947 -0.3
Mercedes 631,471 28.3
Koreans 382,914 32.8
Volvo 240,502 4.0
Source: ACEA. Full details available at http://www.acea.be

Ford, Fiat and BMW declined.

Ford changed two factories from Escort to the Focus, and hitches in early production slowed the flow to the market. December was a bad month, with Ford down 19.5 percent.

"There was a decline, due in no small part to the introduction of the new Focus and the wind down of Escort sales," said Ford spokesman Don Hume in Great Britain. "We expect to do better in 1999 than 1998, as the full range of Focus becomes available. We launched in October with the three- and five-door. The sedan, station wagon and diesels are being phased in now." The Focus is expected to take over from the Escort as Ford's biggest seller. The Volkswagen Golf, Renault Megane and Opel Astra are the main competitors.

Toyota may be the big winner in 1999. Toyota sold 429,071 units this year. With sales of the Toyota Yaris and Lexus IS200 beginning this spring, it could add 100,000 units of sales. The Yaris supermini will compete against European cars like the Renault Clio, VW Polo and Ford Fiesta. An American version, styled as a sedan, was introduced at the North American International Auto Show as the Echo.

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