Sales of new cars in Germany fell sharply in August, official figures showed on Wednesday, driven by a record drop in demand for electric cars in Europe’s largest car market.
According to the German Federal Transport Authority (KBA), a total of 197,322 new cars were registered in Germany last month. That is a decrease of 27.8 percent compared to a year earlier.
The decline was led by a “historic drop” in sales of battery-powered electric vehicles (EVs), according to the car importers’ federation VDIK, which fell 68.8 percent to just over 27,000 units.
The decline in electric car sales is partly due to a comparison effect with August 2023, when motorists bought electric cars en masse before certain government subsidies expired.
However, German sales of electric cars have been on a downward trend all year due to the abolition of purchase incentives. This creates additional headwind for carmakers, who will have to deal with stricter climate targets and fiercer competition from abroad in the coming years.
According to Constantin Gall, an analyst at EY, “electric mobility has gone into reverse in Germany,” adding that he expects little improvement.
“Customers currently prefer combustion engines, if they buy a new car at all,” he said, predicting that electric car sales will be “significantly” lower this year than in 2022 and 2023.
The slowing demand for electric cars is raising concerns about the auto industry in general, with car giant Volkswagen making the shock announcement this week that it is considering closing factories in Germany for the first time.
Volkswagen subsidiary Audi announced in July the possible closure of its factory in Brussels for the production of electric cars.
German Labor Minister Hubertus Heil on Wednesday promised new government incentives for the purchase of electric cars.
mfp/sr/rl