VDA President Bernhard Mattes: German manufacturers confident in Geneva

Berlin, 03 March 2018

Numerous premieres at Geneva Motor Show – Healthy economy – Record employment – Heavy investment in electric mobility and digitization

“We are very confident as we go to Geneva. The German manufacturers will have numerous new and fascinating models on display at the 88th Geneva International Motor Show,” stressed Bernhard Mattes, President of the German Association of the Automotive Industry (VDA), as the 88th Geneva International Motor Show prepared to open its doors.

Mattes highlighted the healthy economic situation: “The global passenger car market will grow by 1 percent in 2018 to 86 million units. In Europe we expect to see a stable market with a volume of 15.6 million passenger cars. The US light vehicle market will show a small decrease (-2 percent) to a total of 16.8 million. China, with 24.7 million passenger cars (+2 percent) will continue its growth path. We welcome the strong recovery in Russia and Brazil, with double-digit growth rates in both countries.”

The German automotive industry had increased its market share in important regions, the VDA President underscored. “In 2017 we sold 4.85 million passenger cars in China and therefore expanded four times as fast as the market as a whole. We pushed up our share of the Chinese market to a good 20 percent. And in the US we managed to buck the trend and increase our sales to 1.35 million light vehicles. In Europe, one half of all newly registered cars bears a German group badge. And our share of the worldwide premium market is over 70 percent. The number of employees in Germany rose to an average of 820,000 employees in 2017. That is 12,000 more than in the previous year and the highest level for 27 years.”

“The automotive industry remains a growth sector. In 2018 the German passenger car makers will expand their production by 2 percent, to a new record of 16.8 million units,” Mattes said. Of these, 11.2 million units (+3 percent) will be built in countries other than Germany, whereas domestic production will remain stable at 5.6 million passenger cars. Three out of four cars manufactured in Germany are destined for export.

The VDA president commented on the current diesel debate: “Even though many people are now demanding retrofits, this type of approach has two key disadvantages compared with software updates, which the German OEMs are providing free of charge for over 5 million diesel cars. Retrofitting will take at least two to three years to implement and will therefore not bring quick improvements in urban air quality. Second, hardware retrofits are always associated with higher consumption and therefore higher CO2 emissions. That does not help climate protection. Software updates, on the other hand, take effect quickly while consumption remains unchanged.” He added that these measures were being supplemented with participation in the German Government’s fund, the trade-in bonuses that have been available for several months, and the city initiative.

Mattes pointed out that the Federal Administrative Court had come out against general vehicle bans: “The court has clearly stated that any bans will have to be proportionate and may only be an option of last resort. Furthermore, politicians have stressed that they want to do everything they can to avoid driving bans. That is the correct approach, also in respect of the many motorists who have been uncertain for months due to the debate on vehicle bans. The German manufacturers make a major contribution to improving air quality.” Modern diesels are still needed for achieving the ambitious CO2 targets, according to Mattes.

He stressed that the German automotive industry had been applying its broad-based strategy for years, which includes all types of powertrains – optimization of classical internal combustion engines alongside the alternative powertrains. Electric mobility is one focal point, in which the companies will be investing 40 billion euros over the next three years. “The number of e-models will be trebled to more than 100 by 2020. Our position in this area is becoming stronger all the time,” Mattes said. For example, in 2017 the German manufacturers expanded their share of new electric car registrations on the Western European market to 53 percent (50 percent in 2016), while their share of the German market rose from 59 to 66 percent. In Norway, the leading market for electric mobility, four out of ten new passenger car registrations are e-cars – and here, too, the German OEMs are the market leaders, taking a share of 54 percent. “The success of our firms is illustrated by the fact that 80 percent of the electric cars produced in Germany are exported,” Mattes emphasized.

“The German automotive sector accounts for 35 percent of all investment in research and development by German industry. German manufacturers and suppliers invest over 40 billion euros per year in research and development. We are extremely active not only in electric mobility, but also in digitization. During the next three to four years, our companies will be investing 16 to 18 billion euros in connected and automated driving. This will make the mobility of the future even safer, more efficient and more convenient,” Mattes underscored. He pointed out that the German automotive industry is already world champion in patents for connected and automated driving. It holds 52 percent of all patents issued in this field anywhere in the world since 2010.

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