European car sales slip 9 pct in March

European car sales fell 9 per cent in March from a year ago, despite government handouts to car buyers that have buoyed German, French and Italian purchases, the European auto manufacturers' association ACEA said on Thursday.

Consumer confidence in recession-hit Europe is at an all-time low as people avoid big-ticket items over worries that job losses could still mount.

March was the eleventh month in a row of declining car sales, dragging the first quarter of the year down 17 per cent from the same period in 2008.

ACEA said a 39.9 per cent sales surge in Germany, the region's largest car market, failed to compensate for sharp drops in Britain _ down 30.5 per cent _ and Spain _ down 38.7 per cent. French sales were up 8 per cent in March while Italy climbed only slightly, by 0.2 per cent.

Germany, France and Italy are trying to support their car makers by stoking sales with a 'crash a wreck, cash a check' program that gives buyers money if they scrap an old car for a more fuel-efficient model.

This has boosted sales in those countries so far this year, but analysts fear that buyers are merely bringing forward purchases and sales will be slow later this year even if the economy improves. EU consumer confidence surveys show that many people are shunning big purchases and are worried about rising unemployment. EU businesses say 4.5 million jobs could disappear this year. Only one car maker _ Italy's Fiat SpA _ saw sales grow in March, by 14.3 per cent.

All others saw sales slip. General Motors Corp fell by 20.1 per cent from a year ago, Toyota by 11.9 per cent, Renault SA by 10.9 per cent, Peugeot Citroen PSA by 9.1 per cent and Ford Motor Co by 7.7 per cent.

Europe's No 1 seller Volkswagen AG declined a more modest 0.3 per cent

German luxury car makers were badly hit. BMW sales dropped 20.8 per cent and Daimler, which makes high end Mercedes cars, posted a 14.6 per cent slump.

Some 1.5 million cars were sold across the European Union plus Switzerland and Norway in March compared to 1.6 million cars in March 2008.