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In the midst of the recession caused by the global Covid-19 pandemic, Germans are buying increasingly expensive cars. Although sales of new cars slumped by a quarter in the first nine months of the year, vehicles sold were on average significantly more expensive than in the previous year. A new car typically cost EUR 37,710 in 2020 – that is 8.1 percent more than in the previous year.
Two fundamental trends in the industry are behind this development:
Both developments have led to new cars becoming more expensive on average – with both SUVs and electric cars having higher list prices. Moreover, German car buyers are maintaining their tendency to buy high-quality products, despite the ongoing coronavirus crisis.
The market shares of electric cars, SUVs and the German premium brands Audi, BMW, Mercedes and Porsche has increased significantly this year. According to Ferdinand Dudenhöffer, director of the Center Automotive Research (CAR) in Duisburg, they account for 27 percent of all four German manufacturer registrations since the start of the year – up two percent for the same period in the previous year.
Sports utility vehicles have surpassed the one-third market share threshold for the first time this year, up 1.4 percentage points to 34.4 percent of market share.
According to CAR, the electric vehicle market is recording the greatest growth levels, with demand for fully electric vehicles and plug-in hybrids in great demand. This is also borne out by a recent study conducted by automotive consultancy Berylls. It reports that the e-vehicle sector enjoyed a substantial peak in the third quarter of 2020, with e-vehicles setting themselves apart from the overall market with a remarkable 145 percent increase in sales compared to the previous year.
Up to EUR 9,000 in subsidies are available for pure electric cars and a maximum of EUR 6,750 for plug-in hybrid vehicles. Even more expensive vehicles costing more than EUR 40,000 are eligible for thousands in subsidies. According to the Berylls survey, 65 percent of respondents cited these grants as their main reason for purchasing an electric car.