Automotive Parts

GermanyType: Large Market; Large ShareGermany ranks number 4 on ITA’s list of top U.S. auto parts exportmarkets. After several years of declining auto sales, Western Europehas slowly begun to show signs of economic recovery.OriginalEquipmentRank4AftermarketRank10The Transatlantic Trade and Investment Partnership (T-TIP) is expected to breathe new life into vehicles salesand production, with the hopeful elimination of tariffsand a significant reduction in the cost differencescreated by divergent regulations and standards,including costs for additional research anddevelopment, production of EU-specific lines, as well astesting and certification costs. In addition, both theUnited States and the Europeans are moving ahead withcollaborative research and development of advancedtechnologies, which will improve the market for fuelefficient vehicles and advanced automotive parts.Overview of the Automotive Parts Market in GermanyDespite a slow economic recovery, Germany continuesto outperform other European markets. Volkswagen, inparticular, exceeded the region’s generally flat sales.Suppliers have not been as impacted by the slowdownbecause they are often less reliant on the growth of asingle company, and generally enjoy a more globalsales base.In fact, with nearly one dozen German automotiveplants scattered throughout the country, Germanyhosts the largest concentration of OEM plants inEurope (over 47 OEM sites). The largest autos marketin the European Union, German vehicle and partsmanufacturers directly employ more than 800,000people (with a further three million employedindirectly).Challenges and Barriers to Automotive Parts ExportsThe greatest challenge facing U.S. auto parts exporters,as well as domestic parts manufacturers in Germany,comes from a general weakness in the economythroughout Western Europe and a drop in consumerspending. As the world’s largest exporter, specializing inhigh-end manufactured goods and capital products,Germany has been particularly hit hard by theslowdown in both the G7 and emerging markets.The barriers to trade that exist in Germany are similar tothe barriers that suppliers face throughout Europe andthe rest of the world. Lack of harmonization/coherenceand transparency of regulations and standards, anddisparity in tariffs are the major barriers for doingbusiness in Germany. These barriers, while notinsurmountable, raise the cost of doing business for U.S.automotive vehicle and parts suppliers.Figure 1: 2013 Germany Automotive MarketSales (units) 3,257,718U.S. Auto Parts Exports to $1,856,340,889GermanyTotal German Auto Parts $86,932,280,140ImportsTotal Domestic Vehicle 5,877,322ProductionVehicles in Operation (2012) 43,431,124U.S. Auto Parts Export +49%Growth 2009-20142015 ITA Automotive Parts Top Markets Report 17