German scrappage subsidy puts Toyota sales back on track

May 4, 2009, 13:08 GMT

Cologne, Germany - A German government car scrappage scheme has brought German sales of Toyota cars back on track after a crash in sales last year, a company spokeswoman confirmed in Cologne on Monday.

New registrations of Toyota-brand cars rose nearly 43 per cent year-on-year to 37,874 in the first quarter, well ahead of overall auto sales in Germany, which rose 18 per cent, largely because of the cash bonus for buyers who trade-in an old car.

Last week, the Japan Automobile Manufacturers' Association (JAMA) branch in Frankfurt said the bonus had pushed up Japanese-brand car sales in Germany by one third.

Confirming a report in the weekly Automobilwoche, the spokeswoman said Toyota was aiming for a market share in Germany above 3.8 per cent in 2009 after making do with 3.1 per cent last year.

Last year, Toyota sales in Germany tumbled 27 per cent to fewer than 97,000 new registrations, with the company attributing this to both the financial downturn and a lack of new models in 2008.

'It was obvious we were going to pour on the power this year, Toyota Germany chief Alain Uyttenhoven was quoted saying in Automobilwoche. He said Toyota would offer Europeans six completely new models this year and six makeovers of existing models.

He said Toyota had been particularly successful with its city car, the iQ, and with its range of small cars.

'We have been doubly lucky, because they came out just at the time the scrappage bonus was introduced, and because smaller cars are in greater demand now than ever,' he was quoted saying.

To encourage new-car sales, the German government is paying owners of old cars 2,500 euros (3,300 dollars) in subsidy to send them to the wrecker. The scheme is costing Germany 5 billion euros.

First-quarter new registrations of all Japanese brands in Germany were just under 120,000 vehicles, 31 per cent more than in the comparable quarter of last year, JAMA said last week.