European car sales fall to 20-year low on unemployment

Charging Lenders

“We will look with an open mind at these measures that are especially effective in our institutional setup and that fall within our mandate,” Draghi said in Jerusalem. Draghi has in recent months held out the possibility of charging lenders to hold cash at the Frankfurt-based central bank by introducing a negative deposit rate.

The euro fell as much as 0.3% to $1.3326 after Draghi’s comments. It later reversed its decline to trade at $1.3378, up 0.1%, at 12:08 p.m. in Frankfurt.

In Asia, Chinese property prices rose at the fastest pace in more than two years in major cities, defying tougher government curbs and constraining the ability of policy makers to ease credit in response to weakening economic growth.

New home prices in Beijing, Shanghai and Guangzhou posted the biggest gains in May since at least January 2011, and 69 of the 70 cities tracked by the government showed increases, the most since August 2011, National Bureau of Statistics data showed today in Beijing.

Restoring Profit

GM’s European sales drop last month was propelled by a 23% plunge at the Chevrolet brand, while Opel and its U.K. sister division Vauxhall posted an 8.4% decline. Detroit- based GM, seeking to restore profit in Europe after accumulating $18 billion in losses in the region since 1999, is reorganizing in response to the car-market drop with plans to shutter a German plant and freeze pay for workers through 2015.

Europewide sales by Dearborn, Michigan-based Ford Motor Co. fell 0.5% in May. The manufacturer, which is forecasting a loss of $2 billion in Europe for 2013, said this week that it’s counting on new models such as the EcoSport compact sport- utility vehicle to help reduce reliance on low-margin sales to rental-car companies in the region.

“Carmakers like Opel, Ford Europe and Peugeot Citroen will have a tough time in Europe in the next few years, especially Opel, which is just concentrating” on the region, Center for Automotive Research director Dudenhoeffer said.

Volkswagen AG, Europe’s biggest carmaker, posted a 2.8% decline in sales in the region last month, led by a 7% drop at its namesake brand. The Audi division, the world’s second-largest maker of luxury vehicles, sold 3.9% fewer cars.

Global Leader

European group sales at Stuttgart, Germany-based Daimler rose 0.5% as the Mercedes-Benz division, the world’s third-biggest luxury-car manufacturer, posted a 2.6% increase, bolstered by demand for the A- and B-Class compacts and CLA four-door coupe. Registrations at the Smart two-seat car brand dropped 15%.

Bayerische Motoren Werke AG, the global leader in luxury- vehicle sales, sold 6.6% fewer cars in Europe in May. Demand dropped 7.3% at the BMW brand and 3.4% at the Mini small-car unit. Toyota, the world’s biggest carmaker, posted a 5% decline in European sales, dragged down by a 33% plunge at its Lexus premium brand.

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