September sees slump in German car sales

New car sales in Germany slid again in September despite an uptick in demand for electric vehicles, official data showed Friday, in more gloomy news for Europe's biggest auto market.

A total of 208,848 new cars were registered in Germany last month, the KBA federal transport authority said, a seven-percent drop on the same month a year earlier.

Sales of battery-powered electric vehicles (EVs), which had been falling for months, came in at around 34,500 units, up 8.7 percent from a year earlier.

But consultancy EY said this did not signal a turnaround for EV sales as the rise was due to a comparison effect -- sales in September 2023 had slumped after certain government subsidies ended the previous month.

EV sales have generally been on a downward trend in 2024 and are well below last year's pace, with critics blaming the phaseout of the incentives.

EY analyst Constantin Gall said the German auto market faces a "problematic mix", from a weak domestic economy to poor consumer sentiment.

There is "no growth momentum in sight at present. We are a long way from a sustainable recovery," he said.

Poor car sales reflect a worrying picture for the broader German auto sector.

Volkswagen, Europe's biggest carmaker, last month warned it could close factories in Germany for the first time in its history as it battles to cut costs and boost its meagre profit margins.

The government hosted crisis talks with senior auto industry figures last month, with VW reportedly calling for a reintroduction of EV subsidies to boost the market.

Adding to the headaches for the country's carmakers, the EU voted Friday in favour of imposing hefty extra tariffs on electric cars made in China, a move Germany's auto sector fears could lead to retaliatory measures.