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For the first time since 2023, new-car registrations in Germany recorded year-on-year growth for three consecutive months. This increase was propelled by a surge in electric vehicle (EV) deliveries. Could new incentives push this result further? Autovista24 journalist Tom Hooker examines the market.
The German new-car market celebrated year-on-year registration growth of 12.8% in September, reaching 235,517 units.
This marked the country’s third consecutive month of improvement, two of which were double-digit increases. According to KBA data, this feat was last achieved between June 2023 and August 2023.
‘September 2025 shows another significant recovery in the German passenger car market after the promising figures in August and July,’ said Robert Madas, Autovista Group’s regional head of valuations.
This is in stark contrast with the market’s performance over the last two years. Between September 2023 and June 2025, Germany only saw double-digit improvements in January and April 2024.
September also denoted Germany’s biggest registration uptick since August 2023. However, results were skewed by the end of commercial customer purchase incentives for battery-electric vehicles (BEVs) in the following month.
‘The growth is deceptive. It is taking place in an overall weak and declining market,’ explained ZDK president Thomas Peckruhn.
Last month’s sales total was set against the third-largest drop for the German new-car market in 2024. The country faces a more representative challenge next month, as registrations grew by 6% year on year in October 2024.
A total of 2,110,336 new models were delivered to customers between January and September 2025. This figure was down 0.3% year on year, meaning the country could enter the green if results stay strong. It is also a significant improvement on the 4.7% cumulative decline recorded from January to June.
BEVs recorded a 31.9% rise in deliveries during September, with 45,495 units. This caps nine months of consecutive improvements for the powertrain, eight of which were double-digit increases.
Last month’s performance could be seen as a slowdown compared to greater growth in August and July. However, the powertrain’s share says otherwise. BEVs represented 19.3% of all registrations in September. This was the technology’s largest share in 22 months and was up 2.8 percentage points (pp) year on year.
Across the first nine months of 2025, BEV deliveries totalled 382,202 units. This equated to a growth of 38.3% and an improvement of 105,812 registrations. The technology took an 18.1% market share in this period, up from 13.1%.
However, the VDIK stated that this share is still not at the level required to achieve CO2 limit value targets.
‘We must support the current upswing with sustainable framework conditions to make a BEV share of well over 20% achievable,’ commented VDIK president Imelda Labbé.
‘To achieve the CO2 targets, we should be open to hybrid powertrains and other technologies. To ensure that the transformation is not accompanied by penalties and job losses, we need a master plan for the ramp-up of electric mobility that focuses on the future viability of the automotive industry,’ she highlighted.
One powertrain that can be used in the transition to BEVs is plug-in hybrids (PHEVs). The technology enjoyed a strong September, with an 85.4% delivery increase to 27,685 units.
This continued the technology’s perfect streak of double-digit improvements since January. The powertrain captured 11.8% of overall sales, up by 4.6pp year on year.
Overall, this meant September marked the biggest monthly PHEV volume, growth and market share since December 2022. This month saw a distorted result, due to the imminent axing of PHEV incentives.
In the year-to-date, PHEVs have seen the best growth of any powertrain, up 63.9% to 217,760 units. Their market share of 10.3% in this period was also up, by 4pp year on year.
Combining BEV and PHEV figures, Germany’s new EV market continued its unbreakable run of double-digit growth, with a 48.1% upswing in September.
A total of 73,180 registrations gave plug-in models a 31.1% share of the sales total. This was up 7.4pp year on year. From January to September, EVs posted a 46.6% surge in volumes to 599,962 units. In turn, its cumulative market share soared from 19.3% to 28.4%.
EVs could soon see demand boosted by incentives. The German government has agreed on new purchase incentives for zero-emission vehicles worth €3 billion through to 2029, according to Bloomberg. The country has not provided any EV purchase subsidies since December 2023.
‘The automotive industry is a key industry for prosperity, jobs and innovation in Germany. We want to strengthen their competitiveness. For this, it is important to further advance electromobility, but at the same time to allow more flexibility and openness to technology in regulation. For this, our industry needs good conditions so that it can survive in international competition with successful products,’ said German Chancellor Friedrich Merz.
The VDIK stated that the focus of the incentives is to be on households with low and medium incomes. However, some of these buyers may only be considering used EVs, which could be affected by the new programme.
‘The announced EV purchase incentives will be a welcome additional step towards accelerating the transition to emission-free mobility, even if not all details are clear yet. The new-car market will benefit from these incentives. However, this will also lead to an additional supply push on used-car markets in the next years, putting further pressure on residual values,’ explained Madas.
‘Now it is important to quickly design residual value-saving incentives for all private customers. The announced measures can only be successful if they are embedded in a master plan that creates framework conditions, such as charging infrastructure and fair electricity prices,’ added Labbé.
The government also wants to extend the EV vehicle tax exemption until 2035. According to Handelsblatt, this could see vehicles registered by 31 December 2030 available for the incentive. However, it is still unclear whether PHEVs would be included in this scheme.
‘The tax exemption has proven to be an effective incentive and would currently no longer apply to new registrations from 2026 onwards, with unforeseeable consequences for the further ramp-up of passenger cars,’ outlined VDA president Hildegard Müller.
‘If the tax exemption expires at the end of the year, fully-electric vehicles would be taxed even higher than plug-in hybrids – a contradiction that the coalition urgently needs to resolve,’ she added.
Meanwhile, the ZDK highlighted that to achieve a broad ramp-up of EVs, the confidence of private customers must also be strengthened.
‘What we finally urgently need are clear and long-term signals from politicians. Without reliable framework conditions, electromobility remains a risk for many customers,’ Peckruhn said.
Planning security is the basis for investments. This applies to both customers and motor vehicle companies,’ he added.
Hybrids, including full and mild powertrains, enjoyed a 14.9% growth in September. The result completes 12 months of consecutive improvement for the powertrain. This underlined a significant achievement considering wider new-car registration declines.
A total of 69,527 hybrids took to Germany’s roads last month. This translated to a 29.5% share for the technology, up 0.5pp on September 2024.
More importantly, the hybrid share was 2.7pp ahead of petrol, the biggest advantage ever recorded by the powertrain. In contrast, hybrids trailed petrol by 3.1pp 12 months prior.
In the year-to-date, the technology recorded a 10.6% rise in sales to 603,270 units. It captured 28.6% of overall volumes during the first nine months of 2025. This was 0.6pp ahead of petrol and up 2.8pp year on year.
Adding hybrids to EV figures, the electrified market took a dominant 60.6% share in September, up 8pp year on year. The powertrain grouping posted growth of 29.8%.
The electrified share was lower in the first nine months of the year, at 57%. However, this was still a positive development from its 45.1% market hold recorded between January and September 2024.
Deliveries of petrol-powered cars dropped by 5.9% last month to 63,047 units. While this fits the narrative of falling sales for the fuel type, a positive can be taken from September’s performance. The result ended eight consecutive months of double-digit decline. It also denoted the smallest registration drop since November 2024.
However, when looking through a different lens, petrol’s performance looks dire. Its monthly share of 26.8% was the powertrains’ lowest since December 2022. During this month, buyers rushed to purchase EVs before subsidies were lowered. Meanwhile, last month’s share was claimed from a relatively stable market.
In the year-to-date, registrations of petrol-powered cars slumped by 23.5%, making it the worst-performing powertrain in Germany in terms of declines. The fuel type’s total of 589,951 units translated to a 28% market share, down from 36.4%.
Meanwhile, diesel-powered cars suffered an even steeper 7.2% fall in September to 28,871 deliveries. The powertrain follows a similar story to petrol.
Diesel has managed three consecutive months of single-digit declines, an improvement on its run of double-digit drops, which lasted from December 2024 to June 2025. Yet, diesel’s 12.3% share, down 2.6pp year on year, is the fuel type’s lowest since December 2022.
The powertrain saw sales decline by 18.9% between January and September, with 308,001 units. It made up 14.6% of total new-car volumes, down from 17.9%.
Germany’s chancellor, Friedrich Merz, has vowed to ‘do everything’ to stop the EU’s ban on the sale of new cars powered solely by internal-combustion engines, according to Barron’s.
The regulation, which prevents the sale of new petrol or diesel models after 2035, was also discussed in a meeting between the chancellor, some of Germany’s carmakers and automotive industry bodies on 9 October.
The ZDK has backed these efforts, regarding it as ‘a long overdue step towards a greater sense of reality in the European CO2-Fleet regulation.’
‘We need a climate policy that is not regulated from the top down, but is designed with a sense of proportion, through incentives that consumers take with them, and not through bans that bully car dealers and vehicle manufacturers,’ explained ZDK President Thomas Peckruhn.
‘A blanket ban on new registrations of combustion engines jeopardises urgently needed investments and undermines confidence in the reliability of political decisions,’ he added.
The ZDK also said that for the maximum reduction of CO2 emissions, alternative solutions are needed. This looks to include efficient ICE models powered by synthetic or biogenic fuels.
‘Our companies are set up to be open to technology, and so should politics. Not every customer, not every fleet and not every mobility need can be mapped purely electrically,’ Peckruhn concluded.
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