Press Releases

Wissmann: German automotive industry speeds up innovation

Berlin, 04 July 2017

Statement delivered by Matthias Wissmann, President of the German Association of the Automotive Industry (VDA), at the VDA’s half-year press conference in Berlin on Tuesday, July 4, 2017

The results from the world’s markets have been generally positive for the first six months of the year. Obviously the sales figures on the most important markets are defying the increasing political risks and debates both in Germany and abroad.

The domestic passenger car market has grown by 3 percent to around 1.8 million units, while employment has risen to 812,000 – the highest level in 26 years. Production and exports are slightly down on the high levels from last year. Growth on the large markets – the US, China and Europe – was less dynamic than in recent years.

Now that does not constitute grounds for pessimism, but it does tell us something towards the end of this parliament: in terms of economic policy there is no reason to sit back and relax – either nationally or internationally – just think of trade policy. In the next parliamentary session Germany will again have to work on its competitiveness. That is essential for Germany as an automotive location, especially from the suppliers’ point of view.

At the same time, we have every opportunity to assert our strong industrial position. The prospects are good for the year 2017 as a whole. The global passenger car market will continue growing, to reach 84.5 million cars (+2 percent). And that is certainly not something that can be taken for granted. The countries that were in crisis (Brazil and Russia) are gradually recovering. After many years of recession they are now moving forward, albeit from a low starting point.

The three large markets – the US, China and Europe – represent 70 percent of the global passenger car market.

  • In 2017 the US market (light vehicles) will remain roughly at the high level of the previous year (17.5 million light vehicles).
  • Following growth of 18 percent last year, China will increase by only around 2 percent in 2017, to 24.1 million passenger cars, instead of 5 percent as forecast in December 2016.
  • Europe (EU28 + EFTA) will slightly exceed last year’s figure (+2 percent) and reach 15.4 million passenger cars.

The markets continue to benefit from low interest rates and the low price of oil.

Yet on the other hand there are some considerable international political risks. They include Brexit, with all the associated insecurity and the uncertain outcome of the negotiations. They also include Europe’s trade-policy issues – regarding the US and China. By contrast, it is welcome – and not only from the auto industry’s viewpoint – that the new French president Macron has made a clear statement about Europe and a close partnership with Germany.

In the face of these increasing difficulties, the German automotive industry benefits greatly from its global position, with production facilities in 22 countries outside Germany. Last year it produced 15.8 million passenger cars, 10.1 million of them in other countries. In China alone, 4 million cars bearing German group badges rolled off the production lines, while in the US the figure was 850,000 light vehicles. Our suppliers have a similarly international orientation – with more than 2,200 foreign sites in around 80 countries. The number of foreign facilities has climbed by over 40 percent since the beginning of the decade. For the year 2017 as a whole we expect another rise in production abroad to 10.4 million passenger cars.

We expect that domestic passenger car production in 2017 will total 5.6 million units, fractionally down on last year’s level (-2 percent), and the same applies to exports (4.3 million cars). This is a result of the weakening British market and also increasing production abroad.

The export quota is 77 percent.

We expect that this year the German passenger car market will maintain its high level of 3.35 million new registrations.

As we are active worldwide, the economic situation in the various regions is of course important to us. Today it is already clear that the slower growth on the global passenger car market is leading to even tougher international competition. To add to this, there are risks like a possible re-alignment of US trade policy, the consequences of Brexit, and political instability such as that in Brazil.

So the conditions are getting rougher. The good level of employment at our domestic facilities is heavily dependent on the export strength of our industry. That does not simply come about by itself. Accessible markets and the associated clear trade policy are more important than ever. Moreover, we have to work on our export strength every day. Just how great these efforts are is shown by a single statistic: the German automotive industry invests 39 billion euros in research and development around the globe – twice as much as ten years ago. And one third of this expenditure comes from the suppliers.


Electric mobility picks up speed

The preparations for future market success are being made today. We are therefore investing hugely not only in digitization but also in alternative powertrains, first and foremost in electric mobility: by 2020 the figure will come to 40 billion euros.

We are now making more and more progress, and the latest growth rates are better than those one year ago, so the market is picking up speed. In May alone, new registrations of electric passenger cars in Germany rose by 178 percent to 3,846 vehicles, although naturally they were starting from a low level. This means that the growth rate for electric cars is fourteen times higher than that for the overall passenger car market (+13 percent). Keen growth has occurred both in plug-in hybrids (+193 percent) and in battery-electric cars (+159 percent).

Year-to-date growth in electric passenger cars is also marked. By the end of May a total of 17,763 units had been newly registered, which was more than double the number of electric cars in the same period last year (+102 percent), while the entire passenger car market added only 5 percent. The proportion of electric vehicles within all new passenger car registrations has thus doubled (1.2 percent). The top ten include six German models. With a market share of 60 percent, the German group brands are making a good showing.


Environmental bonus is a major driving force

One major force driving this dynamic growth is the environmental bonus. Over 20,000 applications had been received by the end of May. The number of applications since the beginning of the year (11,604) is roughly two thirds (65 percent) of all new electric-vehicle registrations in the period from January to May 2017 (17,763). Furthermore, this incentive has been instrumental in encouraging private households to register more electric cars. Their share of new electric registrations rose to 29 percent (17 percent last year) and is only just below that of company cars (31 percent). This ties in with the fact that around half of all new electric registrations are of vehicles in the compact class or small cars.

Overall, three factors are necessary for the ramp-up of electric mobility: building up the charging infrastructure, greater ranges of the models, and lower costs.

Progress has been made in all three of these areas, and German manufacturers are making important contributions here. The issue of vehicle range has been resolved for the new models – we are speaking here of 500 kilometers on one battery charge. And the costs of the battery are falling steadily.

Not only the German Government is promoting expansion of the charging infrastructure to the tune of 300 million euros. Automotive companies, too, are planning to set up an ultrafast high-performance charging network on Europe’s freeways.


German OEMs take a large electric market share

The German car makers are greatly expanding their share of the European market for newly registered electric passenger cars. In the first five months their share rose to 49 percent (45 percent in the same period last year), and in Norway, for instance, it climbed to 57 percent (56 percent last year). This underscores the fact that in an international comparison the German automotive industry is one of the leading providers of electric mobility. By 2020 our OEMs will have more than trebled their range of electric models – from today’s 30 to around 100.


Diesels: differentiation is needed

Turning to diesels: they are subject to never-ending heated public discussion, and their reputation has undoubtedly suffered during recent months. That is something we regret. And we know that the industry has contributed to it. It is true that serious errors were made in some places. And the situation in which the sector finds itself today, and the many areas of uncertainty surrounding diesels, were created by the automotive companies themselves.

Yet, however much justified criticism there is, painting things in black and white, as is currently the case in sections of the public and political spheres, is more of a distortion than a true reflection of reality.

The fact is: in some German cities the annual mean values prescribed by the EU for nitrogen oxides are exceeded at the measuring stations, and that is partly due to diesels. But it is also true that despite the increasing volume of traffic, the air in towns and cities is becoming cleaner all the time. Today the nitrogen oxide values in Germany are 60 percent lower than they were 15 years ago.

Out of a total of 246 roadside measuring stations in Germany, 142 (around 58 percent) still exceed the permitted annual average of 40 micrograms of NO2 per cubic meter of air (μg/m3).

However, the margin by which the limits are exceeded at two thirds of these measuring stations with values of 49 micrograms of NO2 or less is very slender. With targeted measures, these measuring stations can also comply with the limit value in the foreseeable future. Only 14 measuring stations on busy roads still record values of 60 micrograms of NO2 or more.

That does not mean no action is required. But those who are at present saying there is a danger to the health of the nation have apparently lost their sense of proportion. In addition, in some components of the clean air policy are not coordinated with one another. This becomes evident, for example, when the air quality requirements at the workplace are compared with those for ambient air. Germany’s limit value for NO2 at workplaces is 950 micrograms per cubic meter of air – and thus around 20 times as high as that permitted at roadside measuring stations.

We therefore appeal for differentiation instead of defamation. Facts instead of scandalization.

After all, this is the only way to avoid a continuing feeling of insecurity among motorists and to maintain modern diesel technology as an important factor supporting Germany as an industrial location.

Market developments indicate that the announcements of access restrictions have already considerably unsettled many ordinary citizens, and people in business and the craft trades. It is a cause of concern that the market share going to Euro 6 diesels is falling, while that going to gasoline vehicles is rising. One reason this is worrying is that CO2 emissions from a Euro 6 diesel are 15 percent lower than from a comparable gasoline model. The lower the proportion of diesels, the further away we move from the climate protection targets.

An objective debate must include the fact that every type of powertrain has its strengths and weaknesses. Diesels used to have – alongside their advantage with CO2 – disadvantages when it came to NOx emissions. The latest generation of Euro 6 diesels has made huge strides forward on this point, and compared with their Euro 5 predecessors they have 50 percent lower nitrogen oxide values. What is more, the problem of particulates was already resolved many years ago thanks to series installation of diesel filters. So there is absolutely no reason for a diesel-related “particulate alarm” or a driving ban based on that.


Manufacturers examine improvements to existing Euro 5 diesels

Despite all this, it is clear that the mayors of the cities affected are facing huge challenges when it comes to air pollution control. The automotive industry is aware of this and wishes to play its part in finding a solution. Together with policymakers, we are developing strategies for avoiding driving bans and improving air quality.

A wide range of instruments exists for improving air quality. They include modern exhaust treatment systems, improved traffic flow, and digitization of transport, along with the promotion of alternative powertrains and mobility systems, plus rapid fleet replacement, especially of taxis and buses. No single measure on its own will do enough to bring the air quality values in the cities affected into line with the very demanding limits in the short term. Ultimately this will depend on an effective package of solutions.

One possible element in such a package of measures could be the effective improvement of inner-city emissions of nitrogen oxide from Euro 5 diesels by means of new software. At this time the German manufacturers assume that about half of their Euro 5 diesels currently on the roads will be suitable for such improvements. A software update could substantially reduce the NOx emissions from these Euro 5 vehicles on the roads, although they would not achieve the same levels as new Euro 6 vehicles.

The aim of these improvements would be to obviate driving bans and accelerate the improvement of air quality, which will come about during the next few years in any case through natural fleet renewal. This will require an overall political strategy.

At present only 18 percent of diesel passenger cars on German roads satisfy the Euro 6 standard. The faster additional Euro 6 vehicles come onto the roads, the greater the improvement in air quality. By the end of 2020, about 50 percent of the entire diesel car fleet will be modern Euro 6 diesels. This means that in only a few years from now, the nitrogen oxide issue will, in all probability, be resolved. So there are more intelligent measures than banning vehicles.


In the driver’s seat for digitization

Digitization is the second megatrend that the German automotive industry is actively pushing forward. Here, too – as with electric mobility – we have the clear goal of being in the “driver’s seat.” The German vehicle industry accounts for 58 percent of all patents worldwide in connected and automated driving. And we want to remain in the lead. That is why our companies are investing another 16 to 18 billion euros in digitization technologies over the next three to four years.

We know that traffic is increasing in towns and cities. Close cooperation between all the stakeholders will be necessary to make future mobility efficient, environmentally friendly and safe. For this reason one year ago seven German cities, eight companies in the German automotive industry and the VDA joined forces to launch the “Platform for Urban Mobility.” More cities, including Stuttgart, are also very interested in this project. We wish to work together in this alliance to develop innovative solutions for enhancing people’s quality of life in towns and cities.


IAA Cars 2017 – showcasing the mobility of tomorrow

The world of mobility is changing. That will be plain to visitors at the leading trade show for mobility, the 67th IAA Cars, in Frankfurt am Main in September. In line with this year’s IAA slogan, they will see the “Future Now.” The IAA thus regards itself as a driver of innovation. As the organizer of the IAA Cars, we are always developing the world’s most important mobility trade show. The IAA showcases the whole range of innovation in our sector, from digitization and electric mobility all the way to new mobility concepts, especially in towns and cities. In the “New Mobility World” exhibitors and organizers will give these topics an even stronger focus than in 2015.

The New Mobility World 2017 will be a meeting place for innovators from technology and IT firms, startups and established players. They include BlaBlaCar, Harman, IBM, International Industries, Kaspersky, Merck, NXP, Qualcomm, Siemens, Sony, TomTom, Telekom, Allianz, SAP and McKinsey. Facebook is the New Mobility World partner, and Sheryl Sandberg of Facebook will be our guest at the IAA.

The new world in the field of digitization, automated driving and electric mobility will be there for visitors to experience in action not only in Hall 3.1, but also on the large central open-air site, the Agora. The players there will be Audi, Daimler, Volkswagen and the major suppliers Bosch, Continental and ZF.

So far over 50 passenger car brands have registered for the IAA, including the biggest automotive manufacturers from Europe, the US and Asia. In addition, new Chinese manufacturers (WEY and Chery) will come to the IAA for the first time. They have specifically chosen to participate at this leading trade show. This emphasizes the IAA’s international reputation. Many hundreds of suppliers will be there as well.

Of course the preparations for the IAA have been running at full speed for some time at the exhibitors, the venue and here at the VDA. Online accreditation for journalists (at started yesterday. The 67th IAA Cars will be held in Frankfurt am Main from September 14 to 24, 2017. It will be preceded by the Press Days on September 12 and 13 with a total of around 100 press conferences. Federal Chancellor Merkel will officially open the IAA on September 14.

We are looking forward to a very exciting trade show!



  • The first half-year has gone well for the markets. Europe in particular is returning to its old strength. Countries like Russia and Brazil are getting back on a better footing. And for the year as a whole we are optimistic despite the presence of some risks.
  • The increasing growth rates currently seen in electric mobility – and our large market shares in important “electric car countries” – point up the attractiveness of the German models. We are one of the leading providers worldwide and will treble the number of our e-models. We are backing this move with investments running to tens of billions.
  • Despite the controversies surrounding diesels, they remain necessary for achieving the CO2 targets. It is also clear that gasoline and diesel vehicles will still be a key component of mobility for years to come. They still have the potential for another 10 to 15 percent reduction in fuel consumption.
  • The German automotive industry also leads in digitization. This makes driving even safer, more comfortable and more efficient.
  • During the next parliament, Germany must pay more attention to economic-policy issues and work on its competitiveness – in order to safeguard the German facilities. And the entire sector is preparing with great enthusiasm for the IAA Cars, the world’s leading trade show for mobility. It will set new standards in the future-oriented topics.
  June 2017 January - June 2017
Passenger cars *) Volume Change
17/16 in %
Volume Change
17/16 in %
New registrations 327,800 -3 1,787,100 3
  of which
    German makes incl. group makes 225,100 -7 1,238,500 0
    Foreign makes 102,700 4 548,600 11
Export 369,500 -11 2,245,300 -2
Production 493,300 -12 2,940,900 -3
*) Estimate
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