Europe Car Sales Rise Most Since 2011 On Spain Incentives

Billionaire Slim’s Europe Plans on Hold as KPN Talks End

Demand for refined fuels in Italy dropped from 116 million tonnes in 2000 to 80 million tonnes in 2012, he said. In Scotland, the 210,000 bpd Grangemouth refinery was shut down earlier this week in a labour dispute that could lead to the plant’s full closure. A total of 16 European refineries, or 1.7 million bpd of refining capacity has been mothballed since 2008, according to the International Energy Agency. Europe’s nameplate capacity stood at around 16 million bpd in 2012, according to the IEA. Around 330,000 bpd of European refining capacity – or six Mantua refineries – need to be shut down every year by 2020 in order to meet declining demand and rising competitive pressures, Wech said. THE LOSER IS EUROPE Many of Europe’s refineries, numbering around 120, were built in the two decades following the Second World War and are heavily geared towards gasoline production. But as demand for gasoline sharply declined in recent years in favour of diesel, refineries today face a huge surplus of gasoline which is increasingly hard to sell overseas as demand from the United States weakens. At the same time, massive state-of-the-art refineries in the United States, Asia and the Middle East are sending ever-growing volumes of diesel to Europe. And as they benefit from cheaper feedstock and lower energy costs, they can easily compete against Europe’s regional refiners. “Cheap gas is making a huge difference to the profitability of U.S. refining industry. The loser is Europe. It has to be. There is no consolidation going on and no great consolidation hope,” Torbjorn Tornqvist, chief executive officer of trading house Gunvor told the Oil & Money conference this month.

Still, deliveries — which include European Union members as well as Switzerland, Norway and Iceland — are set to contract in 2013 for a sixth consecutive year and hit a two-decade low. The situation is clearly improving, Carlos Da Silva, a Paris-based analyst with IHS Automotive, said in an e-mail. Europe is not in brilliant shape, yet the underlying trend of the market is calling for a certain dose of optimism. Among the regions five biggest markets, Spain posted the largest increase. Sales rose 12 percent in the U.K., where consumer confidence was at a six-year high in September, and climbed 3.4 percent in France . Registrations fell 1.2 percent in Germany, Europes biggest economy, and 2.9 percent in Italy . Dacias Surge Renaults deliveries were helped by a 40 percent surge at the no-frills Dacia brand, which entered the U.K. in 2013. Dacia in the last two years has introduced new versions of the Sandero hatchback and Logan sedan, while the namesake marque has brought to market its first compact crossover, the Captur, as well as a revamped Clio hatchback. Daimlers delivery gain was propelled by a 14 percent jump at the Mercedes-Benz brand, which added the CLA four-door coupe in April as part of a compact-car push. The vehicles include a new version of the van-like B-Class and a redesigned A-Class hatchback. The German carmaker also presented an overhauled S-Class sedan in May and brought a revamped upscale E-Class to market in April.

Europe’s Car Sales Rally, Thanks To Discounts, Dealer Action

But much of this improvement has been down to huge spending by the manufacturers on discounts and price cuts, while dealers are being persuaded to buy the excess cars on their lots which count as new car sales. These will eventually be sold on to the public at well below sticker price. The Brussels-based European Car Manufacturers Association, known by its acronym in French, ACEA, ( www.acea.be ) announced today that Western European car sales were up 5.4 per cent in September compared with the same month last year at just over 1.1 million, bringing the total for the year so far to 8.8 million. Thats a fall of 4.0 per cent on the first nine months of last year. Peter Fuss, partner at consultants Ernst & Young Ernst & Young s Global Automotive Center in Frankfurt, Germany, said the recovery in car sales was down to the improvement in Europes economic outlook, with the Euro currency zone pulling out of recession during the second half of 2013. But with factory use down to less than 65 per cent by manufacturers, according to Fuss, this underlines the chronic overcapacity in Europe, which remains unresolved because of pressure from unions and governments to resist rationalisation. The European industry is looking for a bailout along the lines of the U.S. intervention on behalf of bankrupt GM and Chrysler, to allow it to finally shut-down uneconomic factories. But given the financial crisis in the euro zone, this is simply unaffordable. Ernst & Young expects an overall decline of three per cent in Western Europe for the whole year, and only modest growth next year. This growth will continue to be artificial one that is driven by discounts and self-registrations. We estimate it will take at least two years for the market to witness the real sales recovery, driven by replacement demand. As a result, profits for automakers are likely to remain challenged at least until 2014 is out, Fuss said. According to ACEA, Volkswagen of Germany remains the market leader with just under 25 per cent of the market. VW is still strongly profitable, and has brands like Audi Audi , SEAT, Skoda, Lamborghini and Bentley in its stable.

Europe faces new wave of oil refinery extinctions

Slim directed America Movils highest-ranking executives to negotiate with KPN, including Chief Executive Officer Daniel Hajj, Chief Financial Officer Carlos Garcia-Moreno and Elias, who is director of strategic alliances for the companys landline unit. Slim, 73, didnt personally take part in the talks, said Elias, who like Hajj is a son-in-law of the billionaire. Telefonica Deal The companies failed to reach an agreement even after America Movil helped KPN negotiate a better price from Telefonica SA (TEF) for its German unit, E-Plus. After discussions with Slims company, Madrid-based Telefonica agreed in August to raise its bid for the KPN unit to 8.55 billion euros from 8.1 billion euros. A Telefonica press official declined to comment yesterday. The transaction is awaiting regulatory approval. KPN had argued that a tax offset from the sale of E-Plus makes the company more valuable, people with knowledge of the discussions said earlier, asking not to be identified because the talks were private. KPN was seeking as much as 3 euros a share from America Movil, said Robin Bienenstock , an analyst at Sanford C. Bernstein & Co. in London . They came in to make an offer for a company without fully understanding the rules of the market, she said.