Motor Vehicle Manufacturing in Germany - Market Size, Industry Analysis, Trends and Forecasts (2024-2029)| IBISWorld (2024)

FAQs

What is the outlook for Germany automotive industry in 2024? ›

The VDA is expecting a mixed 2024. It sees deliveries of BEVs slowing by 14% year on year, amounting to some 451,000 units. But it also foresees a 5% growth in PHEVs, with 185,000 of these units expected to take to the roads. 'The significant increase belies the real situation in the automotive trade.

German cars are famous. Several brands have been around for a very long time and are known the world over. The automobile industry in Germany generated over 506 billion euros in total sales in 2022, compared to around 411 billion euros the year before.

The rise of electric vehicles (EVs) is transforming the automotive sector. German automakers are investing heavily in EV technology, with plans to roll out many electric models in the coming years. This shift towards sustainable mobility aligns with global efforts to reduce carbon emissions and combat climate change.

The automotive supply chain will likely never look like it did pre-pandemic, but inventory levels generally recovered in 2023 and are expected to continue doing so in 2024 and 2025. Car prices remain elevated in 2024 due to inflation but are showing initial signs of decreasing as inventory stabilizes.

Germany has a strong tradition of engineering education, which results in a highly skilled workforce that contributes to the country's automotive excellence. Engineers are trained to uphold the meticulous standards and technological innovation that German cars are known for.

Real gross domestic product will probably decline again slightly in the first quarter of 2024, according to the March Monthly Report. The German economy continues to experience headwinds from various directions. Domestic and foreign demand for German industrial products went down further.

Germany: number of enterprises in the manufacturing industry 2011-2022. The number of enterprises in the manufacturing industry in Germany saw no significant changes in 2022 in comparison to the previous year 2021 and remained at around 205180 enterprises.

The main destination of Cars exports from Germany are: China ($20.5B), United States ($17B), United Kingdom ($12.3B), France ($8.89B), and Italy ($8.38B). The fastest growing export markets for Cars of Germany between 2021 and 2022 were United States ($3.82B), South Korea ($1.22B), and Belgium ($1.21B).

Over 22% of Germans work in the manufacturing sector, and the government also has a very successful system in place that keeps wages high (to attract talented individuals) and steady (to keep them.) Germany's focus on testing, innovation, and quality gave rise to its world-renowned machining industry decades ago.

Why is Germany's car industry lagging in the electric vehicle market? ›

Inflation, high car prices and sub-par charging infrastructure are weighing on EV demand. German electric-vehicle sales are projected to drop for the first time in eight years as signs of a slump in the EV market are spreading.

The firms in the German automotive industry compete with differentiation strategy which is founded on high quality and reliability, high performance and fast delivery. They mostly compete in the premium brand and as such get the premium price com pared to their competitors internationally (GTAI 2014).

Here's what to expect for the auto industry in 2024: 1. Sales of new cars should hit 15.7 million, up from 2023. Vehicle availability has steadily improved after years of shortages, so more shoppers should find a ride to suit them.

Despite a shift towards shared mobility, vehicle unit sales will continue to grow, but likely at a lower rate of ~2 percent p.a. Overall global car sales will continue to grow, but the annual growth rate is expected to drop from the 3.6 percent of the last five years to ~2 percent annually by 2030.

Based on the latest auto industry update, the top auto industry trends for 2023 to 2025 include a growing demand for both electric vehicles and autonomous vehicles. You can also expect cars to be more connected than ever in the near future.

For 2025, we expect a moderate recovery with an increase of by 1.2 percent (winter forecast: 1.2 percent). With the lack of recovery so far, there are increasing signs that the German economy is primarily burdened by structural problems and that the scope for economic expansion is small.

The VDA expects the global passenger car market to grow by 2% this year to 77.4 million cars, close to the pre-pandemic level of 78.8 million. Germany's passenger car market is expected to shrink by 1% to 2.82 million, still a quarter smaller than before the pandemic, the association added.

Unless Germany has lost much more potential output than we think, or convergence to potential output is long delayed, German growth is due for a recovery in 2024-2027, although this will start very slowly in 2024. Structural constraints are also evident.