French and Japanese car sales rose in March, as government incentives boosted demand, while South Koreas's Hyundai Motor racked up impressive sales growth despite the end of subsidies in its home market. Carmakers have benefited from government scrapping incentives in major markets, but as the schemes come to an end in some countries many are predicting a dip in sales this year.
French car sales rose 12.8 percent in March, French carmakers' association CCFA said on Thursday, while Japanese sales jumped by a quarter to cap a business year that relied heavily on government incentives. France's Renault has said it expects the European autos market to fall around 10 percent this year, while PSA Peugeot Citroen has predicted a 9 percent drop.
March 2010 had one more working day than the same month last year. Adjusted for the same number of working days, March passenger car sales were up 12.8 percent year-on-year in France, the CCFA said. Italian March car sales are due out later today while Spanish March car sales will be published next week. Japanese automakers such as Toyota Motor Corp, Honda Motor Co and Nissan Motor Co are turning to overseas markets for growth, as domestic demand is expected to shrink as more people move to urban areas well served by public transportation.
But they face tough competition from Hyundai, whose sales in March defied the end of government subsidies at home to surge by more than a third globally thanks to new model launches and strong overseas demand. Shares in Hyundai, with affiliate Kia Motors the world's fourth-largest automaker, jumped as much as 5.6 percent to match the record high they hit last December. US auto sales are expected to show a sharp jump in March, supported by hefty incentives from Toyota as it battles to lure customers back to its showrooms after massive safety-related recalls.
Russian carmaker AvtoVAZ said its sales rose 60 percent last month compared with February sales, as a new scrapping scheme launched by the government in early March spurred demand. Russia had been expected to overtake Germany as Europe's biggest car market before the global industry crisis hit, but sales more than halved in 2009.
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