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Luxury Car Sales Continue to Surge

Source: WSJ - Christoph Rauwald

Posted on 10 Oct 2011

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Despite Europe's deepening debt crisis and slowing economic growth in several major markets, luxury-car sales continued to surge in September, making it likely that BMW AG, Daimler AG and Volkswagen AG's Audi brand will report solid third-quarter earnings growth.

"We made solid gains right across the globe and once again achieved record sales for September, which contributed to a record third quarter," BMW sales chief Ian Robertson said Monday in a statement.

The Munich-based firm expects to hit its 2011 sales target of more than 1.6 million combined for its BMW, Mini and Rolls-Royce brands, he said, which would represent a sales record for the group. BMW expects to remain the world's best-selling premium auto maker, ahead of its German rivals Audi and Daimler's Mercedes-Benz this year.

Mr. Robertson said the new generation of BMW's compact 1-Series and a new coupe at its Mini brand are expected to drive sales momentum in coming months.

Sales for the company's core BMW brand rose 9.3% in September to 128,446 cars. Demand was particularly strong for the compact sports-utility-vehicles X3 and X1. In the first nine months of the year, the brand's sales were up 15% from a year earlier at 1.02 million cars.
BMW's sales figures were mirrored by Volkswagen's Audi.

Audi said Monday that global sales rose 17% from a year earlier in September to 120,200 cars, with strong growth in China, where sales rose 33% to 29,476 cars. Sales in the first nine months of the year were up 17% at 973,200. Sales also grew in some of the countries facing tough austerity measures such U.K. and Spain.

Last week, Daimler's Mercedes-Benz brand posted 120,982 car sales for September, up 2% year-to-year. The brand's sales in the first nine months of the year rose 7.6% to 919,288 cars.

"We will continue to grow in the fourth quarter as well, so we are on track to make 2011 the most successful year in our company's history," Mercedes-Benz sales chief Joachim Schmidt said.

Shares of auto makers and their suppliers got battered during the recent stock market rout as fears about the future of the euro zone, sovereign-debt concerns in the U.S. and potentially slowing growth in China's auto market fueled concerns that the strong sales growth seen in recent months could deflate.

Memories of the last market slump in late 2008 and 2009 are still fresh among investors, when credit markets dried up and car sales contracted sharply in many major markets across the globe amid recession. So far, however, the companies have dismissed the likelihood of another sharp decline in demand, as both sales and orders have been robust.