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Even greener cars for Geneva

2010-03-03 08:40

Geneva - Carmakers will be keen to show off new green technologies at the Geneva Auto Show, opening this week, as economic uncertainties and waning scrapping schemes make forecasting sales trends difficult.

Automakers hurt by the crisis have been supported by government incentive schemes to boost sales, but as bonuses dwindle and the underlying recovery remains far from certain, they will focus on the green cars they believe are the future.

Executives' comments on sales the outlook for the rest of the year, in Europe as well as in faster-growing regions like the BRIC countries, will be closely scrutinised at the show, which opens to the press on Tuesday and to the public on Thursday.

Current order intake trends will be in focus, with industry observers seeking clues about the next few months' sales as the winding down of scrapping schemes begins to make itself felt in in some markets.

New models fuel possible recovery

French car sales data released on Monday showed a 17.8 percent rise in February sales, reflecting orders placed late last year when France's scrapping scheme was still at its highest level.

"The uncertainty surrounding the end of the year is still there - the French market is holding up well but the situation is more complex on a European level," said French carmakers' association CCFA spokesman Francois Roudier.

"In this context, the Geneva Auto Show will be particularly interesting because there will be several new models that will be important for a possible recovery in demand," Roudier added.

With some mass-market electric cars like the Peugeot iOn, and the Citroen C-Zero, based on Mitsubishi's iMiEV, and the Opel Ampera due to make their European debut later this year, the spotlight will be on zero emission technology on display in the show's cavernous halls.

Nissan, which is focusing heavily on electric vehicle technology - with its alliance partner Renault it is putting 4 billion euros in zero emission vehicles -- will show off its own Leaf.

Hybrids, which have not taken off yet in Europe in large numbers thanks to that market's reliance on diesel engines, may have a larger presence in Geneva than at previous European auto shows.

"The significance of Geneva 2010 is that hybrids will go from concept to reality," said Nomura autos specialist Michael Tyndall, citing as examples the hybrid versions of Porsche's Cayenne, the BMW 5-series, and the Audi A8.

"Peugeot will be showcasing its diesel hybrid, which is expected to go into production in 2011. In a lot of ways hybrid is no longer niche, it is now mainstream. And you'll see cars particularly from the European manufacturers that are production-ready hybrids," Tyndall said.

Premium prospects

At the premium end of the spectrum, one of the most closely scrutinised cars on display will be the revamped BMW 5-series.

"The 5-series is important because it's one of BMW's most profitable models and largest revenue contributors," said Morgan Stanley analyst Adam Jonas.

Credit Suisse analyst Stuart Pearson said the launch of the latest version was well-timed: "We're starting to see some signs of recovery in terms of premium car demand. We are expecting corporate fleet demand to be a little bit stronger this year than last."

Nomura's Tyndall said the 5-series is doubly significant because "it's the first car under their new BMW One cost savings regime which will see greater commonality, which obviously there's a slight question mark over at the moment," referring to world number one carmaker Toyota Motor Corp's safety and recall woes.

Small is beautiful

As emissions legislation tightens, and drivers look for greater fuel efficiency, smaller cars will stay firmly in focus.

IHS Global Insight analyst Carlos Da Silva said: "We'll keep to the same the lines as what happened last year and the year before -- always smaller cars or at least more fuel-efficient, green cars."

Nissan will show the successor to the Micra, while Fiat's 2-cylinder 500 "is indicative of the trend towards smaller and more fuel-efficient but no less powerful engines," said Nomura's Tyndall.

Fiat's Alfa Romeo brand is also unveiling a key model for its revival, the Giulietta.


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