The European car industry has skidded into its worst downturn in more than two decades following a collapse in demand due to the euro debt crisis.
Car makers are being forced to close plants and lay off thousands of workers in what is set to become a struggle for survival for some of Europe's most venerable brands.
"This crisis is going to put the very existence of some manufacturers such as PSA Peugeot Citroën under threat," says Ferdinand Dudenhöffer, the director of the Centre for Automotive Research at the University of Duisburg-Essen.
The latest victim is Opel, the loss-making unit of US giant General Motors (GM), which last week announced the shutdown of car production at its plant in Bochum, one of Opel's four German plants, in 2016 with the loss of up to 3,000 jobs.
In October, Ford Motor said it would close a Belgian plant employing more than 4,000 workers. In July, France's PSA Peugeot Citroën announced 8,000 job cuts and a factory closure, and it plans to shrink a further plant.
"This crisis is going to put the very existence of some manufacturers such as Peugeot under threat," says Professor Dudenhöffer. "European car sales this year are going to hit their lowest level in over 20 years.
"And they are going to keep on falling. The debt crisis won't be over next year or the year after that," he says.
Even if the big car makers survive, scores of their suppliers won't.
"We expect that 20 to 30 per cent of small and medium-sized components suppliers in southern Europe won't survive the crisis," says Prof Dudenhöffer.
He forecasts European car sales will shrink 7.9 per cent to 12.5 million units this year, followed by a drop of 3.4 per cent next year.
The declines have been dramatic in Italy, Spain and France where car sales have slumped by between 10 and 20 per cent this year.
"Next year, 3.5 million fewer cars will be sold in Europe than in 2005," says Prof Dudenhöffer. "That is equivalent to the annual production of more than 12 assembly plants."
It stands to reason. If you've been made redundant or think you may lose your job, purchasing a new car is likely to be among the last things on your mind.
"The debt crisis in Europe has been dominating the headlines for more than two years," says Matthias Wissmann, the president of the VDA German Automotive Industry Association.
"This perennial issue is depressing sentiment and making people put their plans on hold."
That even applies to Germany, which has so far been relatively unscathed by the debt crisis. New registrations in Germany are projected to fall 2 per cent this year, to 3.1 million units. The sector's slump is worse than during the global economic crisis of 2008/2009.
Then, European governments had enough cash to rev up car demand with programmes such as incentives to scrap old vehicles and buy new ones. This time, countries are so laden with debt they can't afford to prop up the car industry with major subsidies. And, even if they did, the general economic uncertainty would keep buyers away.
The automobile industry is a key sector for Europe. It employs two million people directly and 10 million in related manufacturing and service sectors, according to the European Automobile Manufacturers' Association.
The austerity drive imposed by governments to reduce their debt burden in return for international bailouts has tipped the car industry into a vicious circle. Falling sales has triggered plant closures and layoffs, which is dampening demand even more.
The only players still doing relatively well in Europe are BMW, Daimler, VW and VW's luxury unit Audi. They are offsetting the European sales slump with strong gains in the United States and China, the world's top two car markets.
The crisis has revealed the German firms' strengths as starkly as it has exposed the weaknesses of their European rivals, which have focused too narrowly on their domestic markets.
"The main losers of 2012 are the European manufacturers in Italy and France, or the European subsidiaries of American auto groups in Germany - the mass producers who concentrated on the European market," says Helmut Becker, the former economic adviser-in-chief to BMW and the director of the Institute for Economic Analysis and Communication in Munich.
To add to their woes, Fiat, Ford, Opel and Peugeot, which all compete in the mid-priced segment and are strongly dependent on Europe, are being squeezed from two sides. From below, low-price competitors such as South Korea's Hyundai-Kia are eating into their market share. From above, Audi, Daimler and BMW are pushing into their segment with smaller cars.
"Regardless of the euro debt crisis and the banking crisis, this is clearly a structural problem," says Mr Becker. "The European markets are saturated. They're not growing, in fact they're shrinking in parts."
The key to success, or survival, he adds, is to join the "merciless competition" to sell to first-time car buyers in fast-growing emerging markets.
That's what the Germans are doing. BMW, Daimler, VW and Audi are all on course for record sales this year. BMW's global sales jumped 20 per cent in the first 11 months of the year to 1.66 million vehicles - already exceeding the whole of last year by 10 per cent.
German brands, and especially their premium offerings - luxury limousines, 4x4s and sports cars where German makers have an 80 per cent global market share - are in high demand among the burgeoning middle classes in China, India, Russia and Brazil.
In China, where car sales are projected to have grown by eight per cent to 13.2 million units this year, the Germans have reached a 22 per cent market share, says VDA.
In the US, where the car market is expected to grow 12 per cent to 14.3 million vehicles this year, sales of German brands have outpaced the market for the past seven years.
Last month alone, German manufacturers achieved a 28 per cent rise in sales of cars and light trucks in the US, almost twice the rate of growth of the overall US car market for that month.
The future looks bright for carmakers with global reach. VW last month said it planned to invest €50.2 billion (Dh242.62bn) in the coming three years in a bid to overtake Japan's Toyota as the world's biggest car maker by 2020.
Part of the money will go towards building new factories in China, Mexico and Russia. All the German players are investing in new factories in or close to the growth markets in a bid to lessen their long-term exposure to currency fluctuations.
Such a plan must seem like an unattainable dream to car makers such as Fiat and Peugeot at the moment.
Their immediate focus has to be to shrink to rid themselves of chronic overcapacity that is putting their survival at risk. Some analysts say up to eight factories will have to be closed around Europe.
"The European mass producers must urgently do all they can to massively reduce their overcapacity - that includes complete plant closures," says Peter Fuss, a partner at management consultancy Ernst & Young.
It's an unseasonably gloomy prospect for many thousands of Europeans.