The DAT-Report and the State of the Automobile Industry

In March the Deutsche Automobil Treuhand (DAT) released its annual report on the state of the automobile industry in Germany. The overall conclusion of the report based on 2012 figures highlights a slight recession in the automobile market. This downswing stems from the sale of cheaper automobiles and lower maintenance costs. The DAT report also discusses the increased role financing services as well as online marketplaces and social media are playing in the industry.

Downsizing leads to lower sales figures

The DAT-Report reveals that compared to 2011, there were 17,000 fewer title transfers last year. Furthermore, the price of the vehicles that did trade hands sank: the average price for new vehicles diminished slightly from 27,390 to 26,780 € while the median price for used vehicles declined from 9,740 to 9,150 €. DAT believes the reduced price for new vehicles stems from customers wanting to downsize and the lower used-car prices come from the older average age of the cars plus their longer lasting performance. [1] DAT also discovered a shift in the market where more people who used to buy new cars are now purchasing used-cars than vice versa. This trend works out in the favour of independent car dealers as they win a larger share of the market since they tend to base their businesses on buying and selling used cars.

Buyers rely more on credit than before

Regardless of the type of vehicle they purchase, buyers are financing their purchases more than before. On average 70.4% of the cost of a new vehicle was financed while 34.5% of the cost of used vehicles was borrowed. In both cases, first-time buyers tended to put less on credit than buyers who already own a vehicle. [2]

The internet’s ever increasing role in the market

The internet is now an integral part of the auto market place: 97% of used-car buyers visited online auto market places and exchange websites to gather information as well as to execute their purchases. Although the percentage is lower for new car buyers, still 6 out of 10 such buyers using the internet before purchasing proves the importance of such websites and tools. [3] This year was the first time the DAT-Report included information about social networks. It found that such networks are especially important for young buyers, under 29 years of age, who contacted such sites up to ten times before a purchase.

Continued importance of the auto industry

Despite some discouraging numbers, the DAT-Report still highlights that the automobile industry continues to be of the utmost importance to the German economy. The total worth generated by the industry last year reached an impressive 185.11 € billion through the sale of new and used cars as well as maintenance and workshop revenue. And even though we probably did not need a scientific study to tell us this, the DAT also confidently reports that driving still proves to be fun and enjoyable 86.3% of the time!

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