High Gas Prices, Taxes Hit German Car Sales
June 4, 2008
New registrations fell by 6 percent month-on-month, to 275,300 in May, the German Automobile Federation said Tuesday, June 3.
Helping to spearhead the fall were big drops for Asian autos, with Japan's Nissan posting a 41.7 percent plunge and Toyota recording a 21 percent decline. Mitsubishi reported an 18.4 percent contraction, while Korea's Kia saw its sales drop 18.2 percent.
In general, leading European auto groups reported more healthy sales in May. The world's top luxury carmaker BMW posted a 7.5 percent rise and sales of Italy's Fiat raced ahead by 30.6 percent. VW sales rose 6.9 percent.
Releasing the data, the federation pointed to soaring gasoline prices and a delay in the new vehicle registration tax rules as key reasons for the drop in May car sales.
Not just bad news
Oil prices climbed to a record high of $135.09 (87.45 euros) a barrel last month, helping to fuel renewed inflationary pressures in both Germany and Europe.
However, the federation said new car registrations were up 4 percent during the first five months of the year, as car sales rebounded from the steep decline following the government's hefty hike in Germany's sales tax at the start of 2007.
Despite the strong euro and the current global economic uncertainties, the federation also said that German car exports remained robust.
Since the beginning of this year, German car exports have risen by 3 percent compared with the same period in 2007.