Car sales slow in US, Europe

Car sales in the United States, Europe and Japan stayed stuck in low gear in September, while emerging markets like India raced ahead.

The loss of government incentives to buy new cars in Europe and Japan led to steep sales drops from a year ago, but US sales bounced back from unusually low levels in September 2009, the month after the US "cash for clunkers" program expired.

The global auto industry's recovery from the financial crisis has been patchy and largely reliant on growth in countries such as China and India, as well as government subsidies and incentives to revive demand.

India's top automakers reported strong September sales, fueled by the country's robust economic growth, but car sales in Japan fell for the first time in 14 months in September after government incentives dried up.

"Overall, I am not that pessimistic about auto demand worldwide," said Lee Sang-hyun, an analyst at NH Investment & Securities in Seoul. "Although demand in the US and Europe is sluggish, sales are growing in emerging markets."

New car sales in Spain fell by 26.9 per cent in September from a year earlier, the third month of double-digit declines following an end to government subsidies.

In France, sales of new passenger cars fell 8.1 per cent in September, while Italy's new car sales fell 18.9 per cent as the loss of incentives to buy less-polluting cars weighed on demand.

In Korea, Hyundai Motors saw year-on-year sales growth of 1.8 per cent in September.

Hyundai, the world's fifth-largest carmaker along with its affiliate Kia Motors , benefited from Beijing's subsidies for fuel-efficient models in China, while its Sonata sedan posted strong sales in the United States, analysts said.

Leading US carmakers all reported double-digit per centage gains from a year ago, but industry-wide sales in September fell 4 per cent from August.

General Motors Co posted a year-on-year sales gain of 10.5 per cent, while Ford Motor Co reported a rise of 46 per cent and Chrysler Group said its sales jumped 61 per cent.

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