Europe falters but Renault sales in rest of the world powering ahead

Renault reported a 1.9 per cent rise in its first-half vehicle sales yesterday, as strong growth in Brazil and Russia made up for a weak performance in Europe where the French carmaker suffered from supply problems.

The group, whose brands include Renault, Samsung Motors and Dacia, is the latest European car manufacturer to see brighter prospects overseas than at home, where economic uncertainty and austerity measures are threatening consumer spending and growth.

Exane Paribas analyst Thierry Huon said: "What is clear is that Renault is doing a good job outside of Europe. In Europe, they are suffering because they have a lack of new products."

The group, which aims to generate 43 per cent of its sales outside Europe this year, has said two key European models are due for overhauls, with a new version of the Clio due next year and the smaller Twingo later this year.

The Renault figures, while lacking information about revenue or profit, may be a sign of lacklustre first-half results for the sector as a whole. Major domestic rival PSA Peugeot is slated to issue first-half vehicle sales today.

Renault said group sales outside Europe rose by 20.4 per cent to 542,411 vehicles in the first half in sharp contrast to sales in Europe, which fell by 7.4 per cent.

The share of group vehicles sold outside Europe grew by 6 percentage points to 40 per cent, helped by Brazil and Russia, in line with its target.

In February, Renault said 45 to 50 per cent of its sales should come from outside Europe by around 2013.

Renault said the supply difficulties that have weighed on its own sales in recent months - which were not related to the Japanese earthquake but to problems with suppliers ramping up capacity after the financial crisis - should start to ease from this month.

The earthquake in March devastated Japanese automotive parts suppliers and had knock-on effects for the global car industry.

As a result of the disaster, Renault, whose partner is Japan's Nissan Motor, pared its forecast for a rise in the global car market this year. It predicted a 3-4 per cent rise in worldwide sales volumes in 2011 and stuck to its forecast for Europe to lag the global trend with a zero-to-two per cent fall.

In January, Renault had forecast a rise in the global market of more than 4 per cent.

The firm also said yesterday that it now saw a 4-6 per cent fall in its home market of France, compared with a previous prediction of an 8-10 per cent drop.Commercial director Jerome Stoll said Renault group vehicle sales would rise this year compared with 2010 and rise again in 2012 compared with this year.

The group is targeting sales of more than three million vehicles in 2013 as part of a long-term strategic plan it unveiled in February.

Yesterday's figures showed that sales of the low-cost Dacia brand fell 2.9 per cent.