In Europe, Jeep stars, while Ford, GM steal VW sales
Fiat Chrysler’s Jeep brand in general and the little Renegade SUV in particular were the star performers for the Americans in Europe last year, while Ford and General Motors Europe both managed to benefit by stealing sales from scandal-hit Volkswagen.
According to the European Car Manufacturers Association, (known by its acronym in French-ACEA) Jeep sales in Western Europe last year rose 118 percent to 82,560 in an overall market that raced ahead nine percent to 13.2 million.
Ford barely matched the pace of the overall market with a sales increase of 7.8 percent to 951,774. GM’s Opel and Vauxhall raised sales 5.9 percent to 875,038, ACEA data showed. Opel sells GM cars in mainland Europe, while Vauxhall sells the same vehicles in Britain under its own brand.
Both companies managed to gain sales from Volkswagen in the final quarter of the year to post respectable performances, according to Automotive Industry Data Editor Peter Schmidt.
Volkswagen, hit by the “dieselgate” scandal which broke in the U.S. in late September, saw sales of its brands rise 5.5 percent for the year to 3.2 million. VW’s house brand rose only 4.3 percent in December as the rest of the market rose 15.2 percent.
VW, with brands like Audi, Porsche, Skoda and SEAT, is the market leader in Europe with 24.3 percent in 2015, down from 25.1 the previous year.
“The Jeep Renegade was the big success story for the Americans in 2015, and accounted for most of that massive increase,” said AID’s Peter Schmidt.
The Renegade is built in Italy using many components from the little Fiat 500. It’s sold in the U.S. too.
“Fiat Chrysler’s decision to use a bog standard Fiat car and place a new body on the vehicle and make it a 4X4 has really paid off handsomely, and has taken advantage of Europe’s new love affair with the SUV. Not only has Fiat increased market share, there’s been a significant jump in unit profits. Given the weakness of the euro versus the dollar, building it in a low-value euro region was an incredibly cunning decision which you’d expect from a genius like (FCA CEO Sergio) Marchionne,” Schmidt said.
Ford and Opel-Vauxhall put in respectable performances, although they had been lagging a bit until Volkswagen was engulfed in the “dieselgate” scandal, Schmidt said. Last September Volkswagen admitted cheating U.S. regulators with software designed to produce clean diesel emissions only when the regulators were looking.
Since then, shamed VW has been forced to use incentives and price cuts to stop a hemorrhaging of its market share.
Opel-Vauxhall has been benefitting from strong sales of its small SUV, the Mokka, while Ford’s slightly bigger Kuga SUV has seen sales growth this year as well. Opel-Vauxhall needs a product to compete with the Kuga, while Ford’s EcoSport contender in the Mokka sector hasn’t performed well, Schmidt said. The Mokka sells as the Buick Encore in the U.S.
Ford Europe this year will import the iconic Mustang sports car and the big Edge SUV. For Opel-Vauxhall, the new Astra small family car is hitting dealerships. This VW Golf and Ford Focus competitor has been well received by the media, and should help GM Europe in its drive to break even in 2016. Ford Europe says it will be in the black this year too.
The SUV boom in Europe, now being propelled ever higher by cheaper fuel prices, should be fertile ground for the Americans, who have wide-ranging experience of SUVs, although many are too big for the European market.
“Cheap fuel prices mean big demand for SUVs (in Europe). Fiat needs to do what Opel-Vauxhall needs too: build a slightly larger SUV to compete with the Nissan Qashqai, Kia Sportage and VW Tiguan. Opel-Vauxhall could use the existing engineering and components of the Astra to make a competitive SUV.”
“With their SUV background in the U.S. these manufacturers should be able to exploit the booming trend in Europe. Yes, they’d need to be smaller but if you use an existing product and put a new hat on it, you could quickly bring it to market, gain profitability and market share. That’s the advice I would give them,” Schmidt said.