Gray and black define the German auto industry
Gray and black dominate: Nearly 60% of newly registered cars in Germany in December are painted in these shades. This may serve as an omen for the local automotive industry. The economy is struggling, inflation remains high, consumer sentiment is low, and competition is intensifying. Not to mention the costly shift to electromobility.
The 23% decline in new registrations in December in Germany was significant, though a special effect from the previous year distorted the comparison. Moreover, there is still a 7% overall increase for the entire year. Pessimists can counter that the 2023 figure is still 21% below the 2019 value. The fluctuation between positive and negative aspects indicates that the automotive world is not simply black or white, or in this case, gray – the color palette is much richer.
Outperforming the market
Looking at the domestic market, German automakers have some positive outcomes: Audi, BMW, Mercedes, and Porsche increased new registrations by 11 to 16% last year. Volkswagen, with nearly 8%, also outperformed the overall market.
In the United States, the second-largest automotive market after China, German brands are also fairly successful. Some already have figures for 2023, while others are expected to see growth, except for Mercedes-Benz. The brand with the star is suffering from a shortage of 48-volt batteries as the supplier, Bosch, faces production issues.
Fiercely competitive
The entire US automotive market has somewhat recovered from the sharp decline during the Covid-19 pandemic and subsequent supply chain constraints, with a growth of over 12%. However, only a weak increase is anticipated for this year. In China, car deliveries increased by 6% in 2023, making it the largest sales region for Volkswagen, BMW, and Mercedes-Benz.
The region is fiercely contested not only because of its size: Electromobility and automotive software play a crucial role in China for market success. The acknowledged deficits of German manufacturers in these areas contrast with the growing strength of Chinese competitors, even though many startups with electric vehicles may not survive market consolidation. But the established companies demonstrate resilience: BYD surpassed Tesla as the world's largest electric vehicle producer in the last quarter of 2023.
