The weakening German auto industry suffered a 4.7 percent decline in sales in the first half of the year. This means that the drastic decline in vehicles sold is slowly having an impact.
The weak sales of German car manufacturers had an impact on the industry’s sales in the first half of the year. The revenues of the most important German industrial sector fell by 4.7 percent to 269.5 billion euros compared to the same period last year in nominal terms, i.e. not adjusted for price effects, as the Federal Statistical Office announced.
In the same period last year, car manufacturers such as BMW, Volkswagen and Mercedes-Benz posted record nominal sales of 282.6 billion euros – also due to increased prices.
The lion’s share of the business is exports
With a 25.2 percent share of total industrial sales, the automotive industry remained the industry with the highest sales in the first half of the year. However, the decline in sales affected all areas: sales fell by 11.6 percent for bodies, bodies and trailers, by 5.4 percent for parts and accessories for motor vehicles such as alternators, transmissions or bumpers and for the production of motor vehicles and engines the minus amounted to 4.3 percent.
Foreign business accounted for a large part of the industry’s sales at 189 billion euros or 70 percent. It was the highest proportion in the past 15 years. Around 1.7 million new cars worth 68.4 billion euros were exported from Germany in the first half of 2024, meaning the number only fell slightly by 0.3 percent compared to the first half of 2023. In the same period last year, manufacturers brought in 198.1 billion euros in foreign sales. Domestic sales fell from 84.5 billion euros in the same period last year to 80.5 billion euros.
At the end of the first half of the year, around 773,000 people were employed by car manufacturers without suppliers. In terms of workforce, the automotive industry is the second largest industrial sector after mechanical engineering with 952,000 employees. For comparison: at the end of the first half of 2019, the industry still had around 834,000 employees.
Demand fell drastically
Most recently, Volkswagen’s announced austerity measures have highlighted the problems facing car manufacturers. The group no longer rules out the possibility that locations in Germany will be completely eliminated. VW also wants to terminate the agreed job guarantee until 2029. At the end of September, the company started collective bargaining with the IG Metall union.
But it’s not just the people of Wolfsburg who are in crisis. Other companies also reported declines in profits and recently lowered their forecasts. The premium manufacturers Mercedes-Benz and BMW also lost their targets due to the weakness in the important sales market of China and the general economic situation. Porsche stated in the middle of the year that no recovery was expected on the Chinese market in the short term.
The entire car market in the EU is developing poorly. Impacted by very weak sales figures for electric cars, new car sales have recently collapsed. According to ACEA, 18.3 percent fewer vehicles were newly registered in August than in the same period last year. It is particularly drastic in this country, with new electric car registrations plummeting by almost 70 percent. However, in the comparable month of August 2023 – driven by very high sales figures due to the impending discontinuation of e-car sales promotions – they were at a record level.