German car market once again expands strongly
Wissmann: German Market Helps Buttress Western Europe – Global Markets Remain Weak
Frankfurt am Main, April 2, 2009. The German passenger vehicle market received a big boost in March 2009, with the number of new registrations rising by 40 percent to 401,000 units. Domestic sales have thus reached their highest level since 1992, when the economy was booming in the wake of German reunification. During the first quarter as a whole, Germany's passenger vehicle market rose by 18 percent to more than 868,000 units.
German manufacturers once again posted a big increase in domestic orders, which rose by 75 percent in March and by 43 percent in the first quarter. Matthias Wissmann, President of the German Association of the Automotive Industry (VDA), explained the situation as follows: "Consumers' concern that the environmental bonus might be terminated early seems to have caused a run for cars in March. However, the planned extension of the program until the end of the year will probably lead to a less hectic situation in the coming months. The environmental bonus and the restructuring of the motor vehicle tax have obviously played a big role in stabilizing the German market, especially with regard to small cars and compacts."
The VDA expects domestic sales for full-year 2009 to be substantially higher than in the previous year (2008: 3.09 million units). Wissmann emphasized that "the positive market results that Germany is currently experiencing shouldn't hide the fact that the German automotive industry faces a very serious situation, particularly in its export markets around the world. The German auto industry, which produced around 11 million passenger vehicles worldwide in 2008, is very much dependent on the development of its export markets, which account for more than 80 percent of the total sales of German vehicles."
Most of these markets (e.g. Spain and the U.S.) still show no signs of any widespread stabilization, which is why Germany's car exports once again dropped significantly in March (-25 percent). A total of 713,700 passenger vehicles were exported in the first quarter, representing a decline of 38 percent from the same quarter last year. Said Wissmann: "The various economic stimulus programs that have been initiated worldwide now have to be quickly implemented so that they can begin to show an effect. Three-fourths of the passenger vehicles manufactured in Germany are exported. The top priority for the German automotive industry is the stabilization of global sales markets." Nevertheless, incoming orders from abroad still show no signs of stabilization, as they declined by 26 percent in March, and by 32 percent during the first quarter as a whole.
In March, German manufacturers once again did significantly better on the still weak U.S. market than did their competitors. Whereas the U.S. market as a whole plummeted by 37 percent, and the Big Three performed even worse, German automakers suffered a drop of only 22 percent, enabling them to increase their market share.
German manufacturers have also once again cut back on production in response to the drop in exports. A total of 395,800 passenger vehicles were manufactured in Germany in March, a decline of 20 percent from last year. Output was slightly over one million units for the first quarter of 2009 as a whole, putting it at its lowest level in 15 years.
