The News

German car sales plunge in April, slashed in half in May as virus hits key industry

15/11/2020

Some 61 percent fewer new cars were registered on German roads in April 2020 than a year ago, official data showed Wednesday, as Europe's automobile powerhouse matched its neighbours' plunging sales for the industry.

Some 61 percent fewer new cars were registered on German roads in April 2020 than a year ago, official data showed Wednesday, as Europe's automobile powerhouse matched its neighbours' plunging sales for the industry.

 

At 120.840, the sales figure from the KBA road transport authority was the lowest monthly reading since German reunification in 1990, as measures to slow the spread of the novel coronavirus took their toll.

Germany's sales crunch was however not as bad as the April collapses of 97 percent in Britain and Italy and 89 percent in France.

April was the first month to show the full extent of the coronavirus' consequences for the car market, customer demand for new vehicles has almost completely collapsed in this period of huge uncertainty.

 

As well as sales, car production plummeted by 97 percent in April, to just 10,900 vehicles. Manufacturing was hit harder than any time since the founding of the federal republic in 1949

 

Over the year to April 30, Germany built just one million cars—down 38 percent year-on-year.

 

German new car registrations plummeted by almost 50 percent year-on-year in May, with virus lockdowns hitting the vital industry hard ahead of a massive new economic stimulus package.

 

Just over 168,000 cars were registered in May 2020, down 49.5 percent compared with May 2019 and following a 37.7-percent drop in March and 61.1 percent in April.

 

The May figures showed "some reduction in tensions on the new car market," but "the car sector remains in a deep crisis".

 

Aside from increased subsidies of up to 6,000 euros for electric car purchases, there was no direct aid for carmakers—reflecting opposition from both economists and environmentalists to a repeat of 2009's post-financial crisis "cash for clunkers" scheme.

 

Some politicians pointed to slashed value-added tax as a potential boost to auto manufacturers.

 

May's data showed that "reopening car showrooms at the end of April had next to no positive effect on demand," said Reinhard Zirpel, president of the VDIK car importers' federation.

 

"The sector now hopes that the measures announced in the stimulus package will end buyers' restraint and bring about an improvement in the second half of the year."