Finally, Europe seems now in a better shape than last years, as alongside France, Spain and Italy, the biggest market on the Old Continent – Germany – has reported increased sales in January, fueled by on going discounts.
Although discounting heavily is not viewed as the best or the healthiest way to increase sales, they are necessary, as Europe has confronted with a six-year slump in demand – and only now carmakers are a little confident that 2014 might be the turning point. We should just take it with a pinch of salt, as such predictions were also made in some of the recent years. Even industry analysts and officials caution us about the demand that was triggered by the generous price discounts.
“Incentives are the name of the game,” said Ernst-Robert Nouvertne, who runs two Volkswagen dealerships near Cologne. “Headline sales are looking good but profit per car is crumbling. The (German) market is still pretty strained.”
Nevertheless, the VDIK importers association said registrations in Germany went up to 206,000 last month compared with January 2013, while this month was also the third one with gains over the past four and the biggest in terms of percentage since September 2011. Back then sales increased 8% to 280,700 vehicles.
“It’s pleasant to see that the stabilization of the German market is continuing at the start of 2014 but we should remain only cautiously optimistic,” said Matthias Wissmann, VDA’s president, noting that last month’s gain is helped by the low basis from a year earlier.
Last year in December, on the basis of the recovery that started last summer, the VDA forecast registrations in Germany may rise from 2.95 million last year to about 3 million in 2014.
Via Automotive News Europe