German car sales improve in January after 2021 struggles

FRANKFURT — Sales of German cars rose year-on-year in January, official figures published on Thursday showed, after the flagship industry was plagued by supply problems in 2021.

New car registrations were up 8.5 per cent in January in Europe's largest economy, the federal transport agency said in a statement.

"The car industry has little grounds at the beginning of the year to breathe," the president of the VDIK car importers' federation, Reinhard Zirpel, said in a statement.

The numbers were rosier than those for December, when sales fell by 26.9 per cent year-on-year, but "the market was still a way off its pre-crisis level in January", Zirpel said.

In 2021, sales fell by 10.1 per cent in Germany as a shortage of semiconductors, a key component in both conventional and electric vehicles, strangled production. 

The result followed a drop of 19 per cent in 2020, when the industry was contending with the economic impact of lockdowns at the start of the coronavirus pandemic.

Sales of electric cars out-performed the market as a whole, with sales increasing 28.1 per cent on January last year.

After seven months in a row in which production figures fell by double digits, car manufacturers turned out 8 per cent more units in January this year than in 2021, the auto industry association VDA said.

Survey data from the "Ifo Institut" think tank also showed that auto businesses saw the supply situation improving. 

In January, 77.9 per cent reported problems procuring materials and components, down from 92.9 per cent in the same survey in December.