German car sales rev up as diesel sputters

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Frankfurt am Main (AFP)

Registrations of new cars in Germany spiked in May compared with the same month last year, official data showed Friday.

The number of new cars on German roads grew 12.9 percent last month compared with May 2016, reaching 324,000, the KBA transport authority reported.

Observers watch new car sales in Europe's powerhouse closely as an indicator of the health of the economy.

The number of vehicles bought for corporate fleets -- some 64 percent of the total -- grew faster, at 15.5 percent, while individual purchases showed a smaller but still sharp jump of 8.5 percent.

Among German manufacturers, Volkswagen remained the largest by registrations, with 18.6 percent of the market despite falling sales, followed by Mercedes with a 9.7 percent share and VW subsidiary Audi at 8.4.

The most popular imported brands in Germany were Skoda -- another VW subsidiary -- Renault and Fiat.

Over the first five months of the year, car sales had increased some 3.7 percent to almost 1.7 million, the KBA figures showed.

But while overall registrations had increased thanks to an extra shopping day in the month compared with May last year, diesel-engined cars continued to lose ground, analysts at consultancy Ernst and Young noted.

In May, petrol-powered cars represented 57 percent of cars sold, while diesels fell back to 40 percent -- down from some 46 percent a year ago.

It was "the biggest decrease since 2009," the analysts said.

Diesels' popularity has taken a blow in Germany from Volkswagen's emissions cheating scandal, in which the carmaker admitted to installing software to fool emissions tests on some 11 million cars worldwide.

The city of Stuttgart, home to historic carmakers Porsche and Daimler, will ban diesel cars not meeting the latest, strictest Euro 6 standards from its centre at times of peak pollution from 2018.

Other cities could follow suit, leaving buyers afraid a new diesel car could lose rapidly in value in the coming years.

Meanwhile, there were big increases in sales for hybrid and all-electric vehicles in Germany.

But the absolute numbers remain small, with 6,843 hybrids and 1,520 electrics registered in May.