PARIS, Feb 12 - Car sales in western Europe fell 1.6 percent in January amid slack consumer spending in France and Germany, dashing hopes for a quick recovery this year, data published on Thursday showed. Brussels-based carmaker association ACEA said auto sales in western Europe fell to 1,173,273 units in January, down 1.6 percent from the same period a year ago, after falling 1.3 percent as a whole in 2003. One less working day in all countries except Britain and Ireland contributed to the dip. Japanese and Korean carmakers, which grabbed market share from homegrown manufacturers in 2003, continued their European assault, boosting sales by more than 20 percent.
Most European carmakers lost market share. Europe's top auto firm Volkswagen and U.S. giant General Motors fared worst, with sales down 10 and 11 percent respectively and market share declining. But Italy's Fiat , which tumbled into crisis two years ago as sales of its outdated cars slumped, bucked the overall trend to nudge sales higher and boost market share to 8.8 percent. This followed market share gains in its key home market last month, as new models charmed motorists, and a rise in European sales toward the end of last year. France's PSA Peugeot Citroen , which lost market share in 2003 as competitors pumped out smart new models, also posted a sharp fall in sales in January, as did DaimlerChrysler brands . The auto industry, which accounts for about four percent of the European Union's gross domestic product, reflects the wider economy and in particular consumer confidence. Most economists expect a modest recovery in European economic growth this year unless a strong euro continues to hurt exporters and high unemployment in France and Germany hampers spending. Most auto industry experts expect a slightly firmer car market in 2004, with recovery tilted toward the second half. ACEA said in a statement the January figures showed a contrasting geographical picture, with clear signs of recovery in Spain and Italy, continued strength in Britain, but sharp falls in Germany and France.//