ExpertEye European Automotive Report Q2 2016 | Page 18

Germany – The powerhouse of Europe
the very strong GDP growth in the first quarter (+ 0.7%) this was to be
expected, but low commodity prices and a historically weak euro

should bolster Germany’s already strong current account surplus.
Unemployment fell sharply despite the influx of migrants, although

there is some upward pressure and house prices have also increased
markedly.

The economic risks
ks from the external environment have increased

following the Brexit referendum. Britain remains an important export
market for Germany and in particular the automotive industry and

whilst the two countries are expected to reach a trade agreement the
current uncertainty will impact anticipated growth potential in the
markets.

New vehicle sales remain strong with cars up 7.1% YTD and LCVs up

10.9% YTD and up 12.9% in June. Whilst business sales were the main
driver behind the increase the numbers of private registrations were

also up +6.4% over the same period with a share of 34.8%. However
the market remains heavily reliant on day registrations and with a
weaker sterling making discounting in the UK more expensive focus is

likely to switch back a little to supporting euro zone sales which

should see a further rise in new car sales in Germany next year of
European Automotive Report - 2016 Quarter 2

Economic Forecasts - Germany

GDP growth (%, yoy)
Inflation (%, yoy)

Unemployment (%)

Public budget balance (% of GDP)
Gross public debt (% of GDP)

Current account balance (% of GDP)

120
115

2014

2015

2016

2017

0.8

0.1

0.3

1.5

1.6
5.0
0.3

74.7
7.8

1.7
4.6
0.7

71.2
8.8

1.6
4.6
0.2

68.6
8.5

1.6
4.7
0.1

66.3
8.3

RV Index: 36 months / 90,000 kms
Average

Germany

110
105
100
95
90

2010 01
2010 04
2010 07
2010 10
2011 01
2011 04
2011 07
2011 10
2012 01
2012 04
2012 07
2012 10
2013 01
2013 04
2013 07
2013 10
2014 01
2014 04
2014 07
2014 10
2015 01
2015 04
2015 07
2015 10
2016 01
2016 04

The dynamics of the German economy have weakened, although after

.

Sources: European Commission – Economic Forecasts
Forecast
Experteye AG - RV Index
Bowkett Auto Consulting Ltd - Forecast vehicle sales

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