VDA President Bernd Gottschalk expects to see a reversal of the downward trend in German car sales after the IAA in Frankfurt this month, with 122 new models regenerating consumer interest in the market.

Speaking in an interview with Automobilwoche, however, he can see no end to the damage being done by the high incentives currently being offered in the market. They are eroding profitability throughout the supply chain, and ultimately not serving the consumer either, as resale values are affected.

Speaking about competition for German OEMs from cars from low cost countries such as the Dacia Logan and even competition from China, Gottschalk pointed out that 60% of cars sold in Germany for less than €10,000 are German brands. He said think that the German automotive industry should aim to span all segments and be the highest quality, highest technology option in all those segments.