The trade dispute between the United States and China is affecting Germany's automotive sector with the number of new vehicles in the Chinese market expected to fall this year, the VDA industry association said.

Reuters noted China is the most important and historically the fastest growing market for German carmakers but Chinese tariffs on German cars built in the US have taken their toll.

"China is currently taking a breather," VDA president Bernhard Mattes told Reuters in Berlin, adding exports of German cars from US factories to China fell by a third in the first 10 months of the year.

The VDA said it expected the number of new vehicles sold in China to decline by 1% this year to 23.9m.

It forecast 2% growth for 2019 to 24.4m.

The association said it expected the global car market to reach 85m new vehicles this year. In Europe, it expected the number of new vehicles to climb to 15.8m in 2018 and remain at a similar level in 2019.

Sales of new cars in Germany will decline by 1% this year, it added, according to Reuters.

Separately, the German auto importers association VDIK also forecast slightly weaker sales in Germany this year and said sales would probably remain at 2018 levels next year.

Some 3.42m cars will probably be registered in 2018, the VDIK told Reuters, adding this showed the new car market was performing well.

VDIK members expect sales to rise by 1% to 1.325m vehicles this year.