European car sales increase for first time in 6 years

<p>Car sales in the European Union jumped by 5.7 per cent during 2014.</p>

The European car market has returned to growth for the first time in six years.

Figures from the industry trade association ACEA showed a 5.7 per cent increase in sales during 2014. It meant that 12,550,771 vehicles were sold in the past 12 months with the ACEA highlighting government scrappage schemes and wholesale business orders as being the main drivers for success.

December was a highly productive month for the automotive sector with European Union car registration jumping 4.7 per cent. It represented a 16th consecutive month of growth and allowed the yearly total to return to prominence for the first time since 2007. There were contrasting fortunes, however when it came to individual countries.

Spain and the UK led the way in terms of registrations, with the former achieving growth of 18.1 per cent while the latter reached 9.3 per cent over the course of the year. Other nations such as Germany and Italy had also performed positively but it was it was different story in France. A December decline of 6.7 per cent meant that it could only remain stable throughout the year with a small bump of 0.3 per cent.

Speaking to the BBC, Peter Fuss, automotive analyst for E&Y, said in a research note: "We remain cautious about the ability of new car sales to return to their pre-crisis levels by the end of this decade.

"Furthermore, car sharing and other alternative trends of urban mobility are expected to gain relevance in the market amid shifting consumer preference."

Earlier in the month, figures from the Society of Motor Manufacturers and Traders (SMMT) showed that just under 2.5 million cars had been sold in the UK in the last year. The group stated that 2.47 million cars were registered in the British Isles in the past 12 months, representing a ten-year high. The Ford Fiesta continued its popularity selling 131,254 units.

Find up to date information on the FTSE 100 and spread betting strategies at City Index.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.