To the casual onlooker, the 2012 Paris Mondial de l'Automobile seemed what most motor shows are meant to be: a happy celebration of the launch of an impressive collection of new cars. Certainly the mix of new machinery was rich and varied, and even this year's crop of concepts seemed pleasantly realistic and on the pace. For your first few minutes, you might even have missed the fact that Europe's mainstream car industry is in deep trouble.

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The cracks were soon visible, however, first in the relative simplicity (read cheapness) of stand designs - Ford, for instance, was much smaller, and struggled to look like more than a car park - and then in the voices and expressions of the many top managers who made presentations. These people are taught to behave like poker players, but things are so bad and manufacturing capacity is currently racing so far ahead of demand, that the size of the problem could not be disguised or glossed over. Even before lunch, car bosses had become heartily sick of the which-plant-will-close question.

Paris motor show gallery part two

Yet all the new product was terrific. The mainstreamers are being attacked from the cheaper end of the market by aggressive and well-financed Koreans, and from above by highly successful premium manufacturers like BMW and Audi. They have no alternative but to make convincing new products - and they did.

Renault had the new Clio, supported by a racy 200hp Renaultsport vision and the showroom-ready Zoe electric car, the model they believe will "humanise" electric car sales. Ford had a whole plethora of machinery: revised Fiestas, the new Mondeo, a roomier Kuga, the baby SUV EcoSport and even a Berlingo-style civilised van called Tourneo Connect. Peugeot made a further fuss of its recently-launched 208 by showing both the new GTi and a "premium luxury" version called XY. Having delayed its new contender in the 208-Clio-Fiesta arena, the Punto, Fiat looked rather bereft, though its cute and ultra-versatile Panda 4x4 provided a minor hit.

Of course, there was the New Golf, which as usual had that confident, crafted-from-solid look that tells you its backers are very well financed (albeit by the sales of premium market Audis). The Golf has made an art form out of delivering exactly what buyers expect, even before they see it, and nobody doubted that with this latest edition the success would continue.

The premium makers, sustained by strong international sales and reasonable demand at home, were making hay. Chief among them was JLR, which showed the magnificent new Range Rover that seems to have been coming for years, and the fabulous F-type Jaguar. Both had tumultuous debuts, and were received with the all-important international critical acclaim. It must have occurred to Jaguar men that there would have been much to lose, had they botched the arrival of the true successor to a car so large in history as the E-type, but (barring the malfunction of one headlight) they didn't.

If there was one Jaguar jarring note, it was over pricing. Given the relative difficulty (versus product excellence) of car makers in lower sectors, it hardly seemed moral that a sports car billed for years as a Porsche Boxster fighter should have a top price - before bespoke options - of £80,000. Several industry-watchers couldn't help wondering whether JLR's practice of charging more than expected for its products, though it works at present, will one day bite the thriving UK concern on the backside.

There was, of course, wall-to-wall talk about market prospects in Europe, and the main conclusion seemed to be that premium cars would keep doing all right, but there would be years of struggle - and potentially big reorganisations - for the mainstreamers. VW's top men, sounding unnecessarily smug, loudly predicted that some of their opponents would fail, something Fiat's Sergio Marchionne sternly rebutted. But it seems that for now, the best Europe's top executives can do is to chase non-European export sales even harder, and do an even better job of "smiling through".