FRANKFURT -- The German automobile industry association VDA said Tuesday that new-car registrations in Europe's largest economy fell 3 percent last month, although export demand continued to bolster production.
The group said new-car registrations in Germany slipped to 237,000 vehicles last month, while production rose 1 percent to 410,800 units helped by exports, which were up 3 percent.
"Despite new models and significant buyer incentives, car manufacturers have not succeeded in stopping the 3-year old downward sales trend (in Germany)," the association said in a statement.
VDA has said 2003 is likely to be another tough year for German carmakers, with stagnant demand at home and a contraction in the world's biggest car market, the United States. It expects flat car registrations in Germany over the year as a whole of around 3.25 million vehicles.
Although market downturns tend to affect volume manufacturers before premium brands, luxury makers such as BMW and Mercedes also have begun to feel the pinch in recent months as the economic downturn bites.
BMW said earlier Tuesday that it had sold 7.5 percent fewer of its BMW brand cars in January than in the same month last year, partly due to a weak point in its product cycle.
Mercedes, the luxury unit of DaimlerChrysler, said Thursday that sales of its Mercedes brand passenger cars edged up just 1 percent to 81,100 vehicles in January.
The latest data from VDA backs up a grim assessment of the car market in Germany and in Europe as a whole.
According to U.K. forecaster JD-Power LMC, car sales in Western Europe slumped 6.8 percent last month due to the unpromising economic environment, while sales in the region's biggest car market, Germany, slipped more than 5 percent.