FRANKFURT: German new car sales fell 0.5 percent to 213,100 vehicles in August, figures from Germany's VDA auto industry association show, amid signs that a recovery in European demand is losing momentum and as luxury carmakers rein in discounts.
The VDA attributed the lacklustre numbers to the normally slow holiday season and one fewer trading day than in August last year, but industry experts suspect a deeper malaise.
Ferdinand Dudenhoeffer, head of the Center of Automotive Research at the University of Duisburg-Essen, said: "There are signs that the market is weakening."
The slight August drop year on year stands in sharp contrast to July's 6.8 percent rise in registrations.
A change of strategy among premium manufacturers offers one possible explanation, with BMW revealing last month that it was rethinking its sales tactics.
"We have to find the right balance between volume and pricing," BMW Chief Executive Norbert Reithofer told analysts on Aug. 5. "If you reduce your volume, you can even have a better profit."
VDA figures show that Mercedes-Benz and Audi sales fell in August as luxury carmakers sought to forego aggressive promotions.
The association's figures also show that sales to private individuals fell by 2 percentage points to 37.8 percent of overall sales last month.
Elsewhere in Europe there are also signs of a slowdown in demand. Car sales fell 3 percent in France and 0.2 percent in Italy, data showed.
In Spain, however, sales by jumped 13.7 percent in August, helped by a government subsidy scheme.
Europe's car industry endured a six-year slump in demand, with sales falling to their lowest level in two decades last year as austerity-hit consumers cut back on expensive purchases, but the market has gradually returned to growth.
Overall, VDA expects annual sales to grow to about 3 million this year from 2.95 million in 2013. In the eight months through August, German new car registrations rose 3 percent to more than 2 million vehicles, it said.
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