Saving costs with car repairs

Munich. Consumers trying to save costs and increasing unemployment are hurting the automotive trade.

Last year the 41,700 member businesses of the German Federation for Motor Trades and Repairs (ZDK) had about 2 million fewer repair jobs than in 2003.

"This is a totally new situation for us," ZDK president Rolf Leuchtenberger said.

In total the industry achieved sales of around 127 billion euros, 1.6 percent more than the previous year. The return on sales was flat at 0.6 percent.

Leuchtenberger stressed that those businesses specializing in vehicle service had a better rate of return than those that focus on selling.

About 1,200 companies closed due to financial problems. The number of employees dropped by 7,300 to 483,000.

The industry also is affected by a continuous discounting battle. The ZDK estimates that in 2004 the industry gave away several billion euros, somewhere in the two-digit region, in discounts and other kinds of incentives.