Mercedes offering 3,000-euro incentive for the new A-Class in Germany as market slows image

Carmakers in Germany are beginning to offer significant discounts on their models, as the largest European market is starting to feel the effects of the eurozone crisis.

Mercedes-Benz for instance offers a 3,000-euro ($3,900) trade-in incentive on the new A-Class, the same amount that Renault is offering for the Megane. Discounts at GM’s Opel and Ford are even bigger, exceeding 3,500 euros on their compact models.

German discounts on new cars rose to an average 12.2 percent in September, the highest since 2010, according to trade publication Autohaus PulsSchlag. But despite these incentives, buyers have not rushed in to buy cars, with Germany posting an 11 percent car-sales decline in September.

This decline may pull sales in Europe this year to the lowest level since 1993, as Germany accounts for 25 percent of the region’s auto sales. European car registrations last month dropped 11 percent from a year earlier to 1.13 million vehicles, pushing nine-month sales down 7.2 percent to 9.72 million, the ACEA announced yesterday.

Declines would have been even bigger without so-called self-registrations by dealers, in which car-sales outlets file license paperwork on vehicles without customer orders. The cars are then sold as zero-mile used vehicles at discounts typically of more than 20 percent.