Germany’s new-car market saw another decline in March, marking the ninth consecutive month of losses. Despite a rise in registrations for plug-in hybrid (PHEV) and battery-electric vehicles (BEV), new-car deliveries dropped by 3.9% to 253,490 units. This, however, was the highest total since June 2024.
According to the KBA’s latest figures, commercial vehicle registrations fell by 6% year-on-year, yet still made up 66.7% of the total market. Private buyer registrations saw a slight improvement of 0.5%, capturing 33.3% of the market. Over the first quarter of 2025, new-car registrations fell by 4.3%, totaling 664,564 units.
Declining Market in Germany Germany’s new-car market experienced its worst first quarter since 2022, with a 4.3% decline. In contrast, markets in Spain and the UK saw growth during the same period. Italy, despite its own decline, also outperformed Germany. Among Europe’s five largest car markets, only France performed worse than Germany.
VDIK president Imelda Labbé pointed out that the decline in vehicle registrations reflects a lack of economic recovery and low customer confidence in purchasing new cars. She stressed that this should serve as a signal to politicians during coalition negotiations to implement sustainable reforms to support Germany’s business environment.
Despite the overall decline, certain market segments showed signs of growth. The upper mid-size segment nearly doubled its volume compared to the first quarter of 2024, reaching a market share of 5.5%. The SUV segment also grew by 5.6%, holding a 31.7% share.
Positive Growth for PHEVs PHEV registrations saw a significant boost, increasing by 65.8% in March, with 26,553 units sold. This was the third consecutive month of double-digit growth for PHEVs, marking its largest improvement since December 2022, when incentives were last in place. PHEVs accounted for 10.5% of the new-car market in March, up 4.4 percentage points compared to the previous year.
For the first quarter of 2025, PHEV registrations rose by 41.8%, reaching 63,799 units, and the segment held a 9.6% share of the market, up from 6.5% in 2024. Despite these gains, PHEVs remain the least popular powertrain option in Germany, aside from the ‘others’ category.
Strong Performance for BEVs March saw a 35.5% increase in BEV registrations, with 42,521 units sold, the highest monthly total since June 2024. This marked the third consecutive month of growth for BEVs, a trend not seen since August 2023. Without BEVs, the overall market would have suffered a more significant 9.2% decline.
For the first quarter, BEVs saw a 38.9% rise in registrations, reaching 112,968 units, a gain of over 31,000 units compared to the same period in 2024. BEVs made up 17% of total market deliveries, up from 11.7% in the first quarter of 2024. This result placed BEVs just ahead of diesel vehicles in terms of market share.
Impact of CO2 Targets Upcoming changes to CO2 emission standards could affect BEV registrations. The European Commission’s proposed amendment allows carmakers to average their emissions across three years (2025-2027), providing more flexibility. However, the current share of BEVs in Germany may not be sufficient to meet the target of 93.6g/km of CO2.
Labbé pointed out that while the extension of the CO2 fleet deadline offers flexibility, the 16.8% BEV share in March is still far from meeting the targets. She called for long-term, stable policies that encourage higher customer demand for BEVs.
EVs Drive Market Growth Combined BEV and PHEV deliveries surged by 45.7% in March, with 69,074 units sold. This was the highest total for plug-in vehicles since December 2023. EVs now represent 27.2% of the new-car market, a 9.2 percentage point increase year-on-year.
In the first quarter, EVs grew by 39.9%, with 50,445 more units sold than in 2024. They accounted for 26.6% of all deliveries, compared to 18.2% in the same period last year.
Petrol and Diesel Struggles Petrol-powered vehicles saw the largest decline in March, dropping by 29.4% to 70,414 units. This marked petrol’s biggest year-on-year drop since December 2021. Excluding petrol cars from the market total, overall deliveries would have increased by 11.6%. Petrol now accounts for just 27.8% of new-car registrations, a 10 percentage point drop from March 2024.
Diesel cars also experienced significant losses, with a 21.7% decline in March, totaling 37,890 units. Diesel’s market share fell to 14.9%, down 3.4 percentage points from the previous year. In the first quarter of 2025, diesel registrations dropped by 21.7%, making up 15.5% of the market.
The combined decline of petrol and diesel vehicles in March resulted in a 26.9% drop in the internal combustion engine (ICE) market, marking its fourth consecutive month of double-digit losses. ICE vehicles accounted for just 42.7% of total registrations, the lowest share since August 2023.
Hybrid Growth Hybrid vehicle registrations rose by 11.7% in March, reaching 74,860 units, the highest monthly total ever recorded. Hybrids held a 29.5% market share, making them the most popular powertrain in Germany for the third consecutive month. In the first quarter, hybrid registrations grew by 10.5%, totaling 192,265 units and accounting for 28.9% of the market.
When combined with EVs, the electrified vehicle market grew by 25.8% in March, capturing 56.8% of the total market. This was a significant increase from the 43.4% share in March 2024. For the first quarter, the electrified market grew by 22.9%, representing 55.5% of all new-car deliveries.
Uncertainty Ahead As the second quarter approaches, uncertainty remains about whether the growth of EVs and hybrids will continue. ZDK vice president Thomas Peckruhn noted that the backlog of new vehicles from 2024, which manufacturers are working through to meet stricter CO2 targets, has yet to be fully cleared.
Peckruhn emphasized the need for clear, targeted incentives from the government to support the future of electromobility, ensuring a holistic approach to charging infrastructure, energy pricing, and purchase subsidies.
The ‘others’ category, which includes hydrogen fuel-cell, natural gas, and ethanol vehicles, saw a decline of 3.2% in March, with 1,252 units sold. This category accounted for 0.5% of the market, the same as in March 2024. In the first quarter, the ‘others’ category fell by 35.8%, with 2,887 units sold, making up just 0.4% of the total market.
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