European car sales sink to 17 year low

New car registrations in Europe went into free fall last year as the eurozone debt crisis drove the continent into recession. New figures for December 2012 suggest that Europe's car crisis hasn’t hit rock bottom yet. The number of new cars registered in Europe in 2012 dropped 8.2 percent to a total of 12.05 million vehicles, the European Automobile Manufacturers' Association ACEA announced Wednesday. ACEA said the figure was the lowest recorded since 1995. The decline - compared to the previous year - was the steepest since 1993, when annual sales contracted 16.9 percent, it added. The carmakers' association blamed the eurozone debt crisis, which brought declining economic activity and rising unemployment to Europe, for the slump in consumer demand. In December 2012, the free fall in new car registrations appeared to have accelerated as contraction in the car sector reached about 16.3 percent. As in the previous months, December's drop-off was most noteably in nations at the centre of the eurozone debt crisis. Portugal sales decreased 43 percent, while Greece posted a 33-percent drop to be followed by Spain where 23 percent fewer cars were sold. The biggest slump of 51 percent was reported in Cyprus, which is currently negotiating a bailout for its ailing banks. Shrinkage hits Italy, Germany More worryingly though was the fact that the continent's biggest car markets, Germany and Italy, also shrank in 2012. Their new registrations plummeted by 16 percent and 22 percent respectively. Only two non-eurozone countries, Sweden and Britain, posted solid gains in 2012, ACEA said. In December, Europe's car crisis reached virtually all of the continent's major auto makers. Sales in Europe by the major German concern Volkswagen dropped 22 percent in that month, while its French rival Peugeot sold 18 percent less and the sales of Italy's Fiat group slumped 17 percent.