Boston, MA -- (SBWIRE) -- 01/10/2013 -- Passenger car sales declined 10.9% y-o-y in September 2012, to some 250,000 units. Over the first nine months of the year, sales in this segment were down 1.8% y-o-y, to 2,337,311 units.

In September, we revised our sales forecast in this segment to a bearish 1% decline over the year, from a 1.1% increase previously forecast. This revision was predicated on weak sales figures to date, combined with our increasingly bearish outlook for consumer confidence in the country. We maintain this 2012 sales forecast for now, as we believe September sales figures have dragged the year-to-date sales figures down, and we expect the reduction in sales to abate somewhat over the remainder of the year.

German automotive trade publication Autohaus PulsSchlag estimates that discounts on new cars in Germany rose to an average 12.2% in September, the highest levels since 2010. This suggests that the small decline in sales we have seen to date would be worse without the heavy discounting schemes by auto companies.

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Passenger car production in Germany fell 6.8% y-o-y in the first nine months of 2012, to 4,111,400 units. Previously, BMI forecast a decline of 1.2% in passenger car output this year. However, in light of the year-to-date figures, weak exports and domestic demand, and our generally bearish view on manufacturing in the country, we recently revised this to a drop of 6% in 2012. Passenger car exports in this period have slumped 3.6% y-o-y, to 3,150,300 units. A large proportion of Germany's exports are for Europe, where sales figures have generally dropped this year. Indeed, a number of premium German marques have faced declining sales across Europe in recent months, although such declines have been modest compared with many of their mass-market counterparts.

Commercial vehicle (CV) sales declined 16.6% y-o-y in September, to 24,138 units. Over the first nine months of the year, sales in this segment declined 4.2% y-o-y, to 232,590 units.

The outlook for the German economy continues to be overshadowed by the retrenchment in demand among euro area economies. BMI believes that, in the absence of a decisive resolution to the eurozone crisis over the next 12-18 months, investment levels are set to suffer substantially, and business confidence is likely to remain subdued, which will hit domestic demand across the economy. In light of these sales figures and the ongoing deterioration in business confidence and investor sentiment in the country, we recently revised our 2012 CV sales forecast further, to a 3.2% decline.

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