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Few speedbumps on Asian carmakers' road to Europe

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(Globalpost/GlobalPost)

The economic crisis in Europe has a silver lining for Asian carmakers which are gaining sales and market share on the continent at the expense of ailing European competitors, observers said on Wednesday.

Last year, just 12 million new cars were sold throughout the European Union -- the lowest number since 1995 -- and 2013 has gotten off to a bleak start as well.

But as European automakers like PSA Peugeot Citroen, Renault, Fiat and Opel struggle to bounce back, Asian rivals have expanded their traditionally far smaller presence on the continent.

The Japanese brands Toyota and Nissan for instance have been "surfing on a wave of new products ... that really hit the market at the right time" in Europe, according to IHS Automotive analyst Carlos da Silva.

"They have a number of models that really appeal to European consumers," he told AFP, noting for example Nissan's new Juke cross-over and Toyota's strength in the hybrid sector owing to its well-established Prius model.

Toyota made a profit in Europe in 2012 and expects to do the same this year, the head of its European operations, Didier Leroy, told the Geneva Motor Show this week.

Nissan announced that despite "a shrinking market and ... a really tough financial climate," it had achieved a record European market share of 3.8 percent last year.

Mitsubishi, which has a far smaller footprint in Europe, said it too expected to generate stronger sales on the continent despite the difficult climate.

"We think that in 2013 the market situation will continue to be quite hard for us, but we are still hoping to increase the sales numbers in Europe," the Mitsubishi president Osamu Masuko told AFP.

The company that has seen the strongest growth in Europe is not Japanese however, but South Korean.

"Hyundai are really the ones who have grown the most in Europe," da Silva said, pointing out that the company had invested heavily and "has really strengthened its authority" on the continent.

Since the financial crisis began in August 2007, the company says it has doubled its market share in Europe, from 1.8 to 3.6 percent.

In France, where the overall car market was down 14 percent last year, Hyundai says its sales surged by more than 40 percent.

"We're generally quite optimistic and can make our way in difficult times. I don't see any change to that," Hyundai chief operating officer Allan Rushforth told AFP.

He insisted that the company's "value proposition" of offering lower-priced but still high-quality cars served it well during downturns.

The world's fifth largest carmaker, which is working to promote quality and design over its traditional low-cost reputation, Hyundai wants to bring its European market share up to the same level as that in the global market, Rushforth said.

"The objective is to bring Europe up to about five percent, probably by the end of the decade," he said.

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http://www.globalpost.com/dispatch/news/afp/130306/few-speedbumps-asian-carmakers-road-europe