San Francisco Frontiers - German car sales jump in July but market still weak

A total of 264,802 new cars were registered, up 11.1 percent year-on-year, the KBA federal transport authority said.

Across a less volatile six-month comparison, however, new car registrations were down 2.5 percent, underlining Germany's sluggish market for new vehicles.

"Demand is still weak, individuals and companies are delaying purchases amid a weak economy and very uncertain prospects," said Constantin M. Gall, an automotive analyst at consultancy EY.

"The new car market is not moving forward."

New car sales were particularly weak in July 2024 after customers had rushed to buy cars the previous month, hoping to avoid pricier vehicles before a new EU regulation mandating driver-assistance systems took effect.

"The big plus for July is down to special circumstances and does not mark the start of trend," Gall said.

The weakness in Europe's biggest economy is bad news for its car giants like Volkswagen and BMW as well as foreign rivals who make substantial sales in the country.

Germany's car industry is already struggling with high production costs at home as well as a costly transition to electric vehicles and ferocious competition in key market China, where local competitors like electric carmaker BYD have stolen a march.

These are now making inroads into Germany -- despite steep European Union tariffs on Chinese-made electric vehicles -- though overall market share remains small.

BYD sold 1,126 cars in Germany in July 2025, the KBA figures showed, a rise of almost 400 percent year-on-year and more than the 1,110 that Elon Musk's Tesla managed.

Tesla's sales were down 55 percent, the latest drop for the carmaker which has suffered worldwide due to intensifying competition and as Musk faces a backlash for having worked as an adviser to US President Donald Trump.

Xpeng, another Chinese carmaker, meanwhile notched a rise of over 1,500 percent, registering 266 vehicles.

W.Carter--SFF