Germany’s car market rose 12.8% in the first half year-on-year, buoyed by a return to normal supply chains, although sales prospects are uncertain, official figures showed on Wednesday. A total of 1,396,870 new cars were registered in Europe’s largest economy in the first six months of 2023, the Federal Automobile Agency (KBA) said in a statement.
Sales in June, with a year-on-year increase of 24.8%, confirmed the recovery trend of recent months, compared to a particularly weak 2022. “The current situation for German car manufacturers has improved considerably,” observed the Ifo economic institute. But despite this recovery, car production in Germany is still 10% lower and sales 24% lower than in the first six months of 2019, before the Covid-19 pandemic, notes the VDA industry federation.
Sales increase until the end of the year
The auto sector is slowly recovering from bottlenecks, especially in the supply of microchips, which hampered vehicle deliveries to customers as the economy recovered. “The chip crisis, long waiting times and a shortage of new cars are now a thing of the past,” Ferdinand Dudenhöffer said in the Center for Automotive Research’s monthly report. In this climate, “the customer is king again,” he believes, noting a drop in car prices in June in Germany.
This upward trend in sales should continue at least until the end of the year, according to Constantin Gall, an analyst at EY. The “comfortable” order book from manufacturers and the recovery in demand after several years of weak sales should allow the recovery to continue “in the coming months”, he stresses, anticipating a 15% increase in sales in the whole of 2023. However, he predicts that inflation, high car prices and the rising cost of credit will eventually weigh on consumption.
Short-lived success for electric vehicles
Sales of 100% electric vehicles increased by 32% in the first half, driven by the June boom (+64% in a year). An ephemeral success, warns Constantin Gall, for whom the end of subsidies for commercial vehicles as of next September should slow down the growth of the automobile market. The electric boom is especially benefiting the American Tesla, whose sales almost doubled in the first half year-on-year.
In the first half of 2023, only the Opel (-5.7%) and Ford (-4.8%) brands lagged behind the first six months of the previous year, with all other vehicle brands posting an increase on new registrations. As for the German brands, Volkswagen maintained the leading market share in June, with 19% of car sales.
Source: BFM TV
