European car sales hit skids in USA
By Earle Eldridge / USA TODAY
U.S. sales of European cars are tanking as buyers switch to Japanese or Detroit brands.
Sales of European brands fell 6.9% in the first quarter, while Asian brands were up 9.5% and domestic sales grew 2.2%, according to Autodata.
Meanwhile, almost 40% of Volkswagen owners who bought a new car in the first quarter switched to an Asian brand, according to Power Information Network, an affiliate of J.D. Power and Associates. More than 22% of Mercedes-Benz owners switched to an Asian brand during that time.
"Owners of every European brand are moving away from the brand," says Tom Libby, director of industry analysis for the Power Information Network.
Quality might be an issue. While the quality of all brands has improved since 1998, Europeans have made the least gains, according to J.D. Power's initial quality survey.
The survey asks new vehicle buyers to identify problems in the first 90 days of ownership.
European brands went from ranking No. 1 in the 1998 survey to tying for second place with domestics behind Japanese brands in 2003.
Europeans particularly have problems in the survey with features such as electronic accessories, turn signals, power windows, sunroofs, trip computers and navigation systems, says Brian Walters, senior director of vehicle research for J.D. Power.
This year, for the first time in 24 years, the average domestic car was rated more reliable than the average European car in Consumer Reports magazine's annual survey of owners.
"It comes down to reliability," says David Champion, head of the magazine's auto test center. "Reliability of European brands has taken a toll on sales."
Volkswagen has set up a 50-person team to attack quality and reliability issues.
"Our goal is to find the root cause of any quality issue and get it resolved within eight weeks or less," says VW spokesman Tony Fouladpour.
But Fouladpour says VW's sales drop, 25% in the first quarter from a year ago, has more to do with the fact that VW models carry less rebate money than rivals.
Mercedes says its sales were down about 5% in the first quarter because of a changeover to new models. The brand has 10 new products coming for the 2005 model year.
Keith May, vice president of sales for Mercedes-Benz USA, predicts those new models "will take us to another record year this year, and our biggest product offensive in history (is) coming in 2005 and 2006, which will take us forward from there."
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By Earle Eldridge / USA TODAY
U.S. sales of European cars are tanking as buyers switch to Japanese or Detroit brands.
Sales of European brands fell 6.9% in the first quarter, while Asian brands were up 9.5% and domestic sales grew 2.2%, according to Autodata.
Meanwhile, almost 40% of Volkswagen owners who bought a new car in the first quarter switched to an Asian brand, according to Power Information Network, an affiliate of J.D. Power and Associates. More than 22% of Mercedes-Benz owners switched to an Asian brand during that time.
"Owners of every European brand are moving away from the brand," says Tom Libby, director of industry analysis for the Power Information Network.
Quality might be an issue. While the quality of all brands has improved since 1998, Europeans have made the least gains, according to J.D. Power's initial quality survey.
The survey asks new vehicle buyers to identify problems in the first 90 days of ownership.
European brands went from ranking No. 1 in the 1998 survey to tying for second place with domestics behind Japanese brands in 2003.
Europeans particularly have problems in the survey with features such as electronic accessories, turn signals, power windows, sunroofs, trip computers and navigation systems, says Brian Walters, senior director of vehicle research for J.D. Power.
This year, for the first time in 24 years, the average domestic car was rated more reliable than the average European car in Consumer Reports magazine's annual survey of owners.
"It comes down to reliability," says David Champion, head of the magazine's auto test center. "Reliability of European brands has taken a toll on sales."
Volkswagen has set up a 50-person team to attack quality and reliability issues.
"Our goal is to find the root cause of any quality issue and get it resolved within eight weeks or less," says VW spokesman Tony Fouladpour.
But Fouladpour says VW's sales drop, 25% in the first quarter from a year ago, has more to do with the fact that VW models carry less rebate money than rivals.
Mercedes says its sales were down about 5% in the first quarter because of a changeover to new models. The brand has 10 new products coming for the 2005 model year.
Keith May, vice president of sales for Mercedes-Benz USA, predicts those new models "will take us to another record year this year, and our biggest product offensive in history (is) coming in 2005 and 2006, which will take us forward from there."
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