Tag Archives: Germany

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Demand for EVs in Germany dropped by 54.9 percent

At the end of last year, the German Association of the Automotive Industry (VDA) predicted that the demand for EVs in Germany will fall in 2024, despite constant growth in the world market. This already happened in January, when demand dropped by 54.9 percent compared to the same period in 2023. One of the reasons is the abolition of the subsidy.

The German government’s sudden decision to temporarily suspend subsidies for the purchase of new EVs has forced manufacturers to reduce vehicle prices in order to remain competitive with other manufacturers. As a reminder, BYD lowered prices by 15 percent, while Dacia reduced the price of the Spring model by 10,000 euros.

Buyers turned to proven options, gasoline and diesel cars, which had a decline in sales last year. However, the current situation with EVs has resulted in demand for cars with internal combustion engines. In January, 9.1 percent more gasoline cars were sold compared to the same period in 2023, while demand for diesels increased by 9.5 percent.

Another major reason for the decline in demand for EVs is the current state of the German economy, which has recently been in crisis, as well as geopolitical tensions in the region. Inflation, high prices and poor infrastructure of charging stations also affect demand. Even the leading car rental companies are looking for alternatives for their fleets due to the high cost of maintaining electric vehicles.

The VDA expects the German car market to drop by 1 percent to 2.82 million in 2024. At the same time, the global market is forecast to grow by 2 percent to 77.4 million cars. “Problems in the supply chain have largely been resolved, but the business environment for German carmakers remains challenging,” said VDA chief economist Manuel Kallweit.

Source: Reuters

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Ford cuts 3,500 jobs in Germany

In mid-2022, Ford hinted that it would stop producing its popular compact Focus next year, and now it’s official. This decision will cause the loss of 3,500 jobs in Germany.

The factory in Saarlouis was opened in 1970, and after 55 years it could be completely closed. Ford had talks with Chinese brands BYD and Chery about taking over the factory, but also with a German manufacturer of solar panels. However, the latest information suggests that the deal has not been made.

Although Ford intended to assemble its new electric models in this factory, it will not happen. Plans have changed and the new electric Ford models will be assembled at a factory in Valencia, Spain. Some information says that Ford made an agreement with the union IG Metall to lay off workers. Union representatives said that after 2025, around 1,000 workers will remain at the Saarlouis factory, who will be offered retraining, and that there will be no forced redundancies until 2032. Also, employees will be able to leave early with severance pay.

Source: Reuters

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Germany predicts a drop in demand for EVs in 2024

In the last year, the demand for electric vehicles in Europe has been on the rise. One of the largest manufacturers, the BMW Group, achieved an increase in EV sales in 2023 by 74.4% compared to 2022. However, now the German Association of the Automotive Industry (VDA) is predicting a drop in demand for EVs in 2024.

Of course, this does not apply to the world market, which expects a growth in demand for EVs this year as well. This could ultimately bring export growth (19 percent to 1.45 million vehicles) but also higher profits for German manufacturers.

At the end of last year, the coalition government of Chancellor Olaf Scholz completely abolished subsidies for electric vehicles, a year earlier than previously planned. Germany will sell over 524,000 fully electric cars in 2023 – more than any other market in Europe. The predicted drop in sales this year means that the share of EVs in Germany will drop from 18 to 16 percent (about 74,000 vehicles less than in 2023).

Inflation, high prices and poor infrastructure of charging stations mostly affected demand, so many manufacturers postponed the introduction of new electric models. Even the leading car rental companies are looking for alternatives for their fleets due to the high cost of maintaining electric vehicles.

The VDA expects the German car market to drop by 1 percent to 2.82 million in 2024. At the same time, the global market is forecast to grow by 2 percent to 77.4 million cars. “Problems in the supply chain have largely been resolved, but the business environment for German carmakers remains challenging,” said VDA chief economist Manuel Kallweit.

Source: German Association of the Automotive Industry – VDA