Leading German automotive researcher Ferdinand Dudenhöffer is expecting a lower level of discounting in the German car market during 2008. Discounts currently average around 16.5%.
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According to news agency dpa-afx, discounts should fall as the market recovers. In a recent study Dudenhöffer said he was forecasting the German car market to rise from 3.16m units in 2007 to 3.34m in 2007.
At the end of last year there was a noticeable reduction in discounts in October and November, but competition got hotter in December, with renewed discounting. One of the reasons was that dealers were registering vehicles themselves. In November almost 30% of vehicles were registered by dealers, which then had to offer incentives to sell the vehicles.
In addition, vehicle manufacturers increased their special offers. In December 24 vehicles were being offered at 20% below the official price list, and 55 vehicles were on offer at over 15% below list price, according to Dudenhöffer.
Dudenhöffer expects the market to rise in 2008 because of a greater willingness on the part of German consumers to spend, the lack of any pull-forward effect from the rise in the VAT rate that affected the market in 2007, and lower unemployment.
He also expects the introduction of planned ‘eco-zones’ in large cities will encourage some people to change their cars.
