German car manufacturers lose market share across their biggest markets
Handelsblatt
Sales of cars from German manufacturers VW, Audi, Porsche, BMW and Mercedes in the EU, USA and China are 2.1 percent lower in 2024 so far than the same time period last year, despite overall sales having increased in these markets, business daily Handelsblatt reported. The data, which comes from two automotive analysis companies, Marklines and Dataforce, shows that competitors like BYD in China and Tesla in the USA are benefiting from the German loss of market share.
The newspaper writes that many consumers are no longer willing to pay the high prices associated with German manufacturers after years of inflation. “Most global car manufacturers will find it difficult to expand their profit margins in the coming years as they come under increasing pressure to lower their prices in the face of fierce competition,” Vittoria Ferraris, credit analyst at the rating agency S&P Global, told the newspaper.
However, VW, BMW and Mercedes still are expected to generate an operating profit of well over 14 billion euros each this year. Frank Schwope, lecturer in automotive economics at the technical university Fachhochschule des Mittelstands in Hannover, said “this is not a crisis”. However, he added that it could become one if the companies do not address four major issues: their share of combustion engine vehicle sales is too high, vehicles need to soon abide by stricter EU carbon dioxide limits, worsening outlook for German carmakers in the Chinese market, and overcapacity in domestic production and high labour costs.
"Overall, it is clear that car manufacturers lose more market share the more combustion engines they offer," wrote Handelsblatt.
The loss of market share of the German auto industry has led to cuts in the sector. Domestic electric car sales decreased markedly after the government abolished purchasing subsidies last year. Germany recently opposed an EU tariff on Chinese electric vehicles to protect its car industry from any potential retaliation, though it was unsuccessful in gathering support to block them.
