Small and medium-sized vehicles need limited parking spaces, make it easier to drive on city roads and have a lower environmental impact. Some manufacturers are investing in small and medium sized vehicles, while others are betting on more profitable models. This is reported by Deutsche Welle in an article. Officially, the German auto industry sees many advantages in small and medium-sized vehicles, especially when equipped with an electric motor. Experts note, however, that many manufacturers are phasing out the development and production of smaller cars. The reasons are different. According to Rosavtomobilya, in December 2022, sales in the segment of small and medium-sized vehicles increased by 15.7%. Relatively percentage SUVs multi-purpose vehicles rose to 34%.

In the sector of small and medium cars, the long-term trend of the period 2012-2022 is obvious. However, the German Automotive Industry Association VDA is positive about the current situation, reporting that over 420,000 small and medium-sized vehicles have been sold by the end of 2022, of which a third are electric. From this development, the automotive industry concludes that Germany has a very high percentage of small and medium-sized electrified vehicles. The association notes that since the German government subsidized the purchase of electric vehicles, the importance of small and medium-sized transport has increased even more. On the other hand, it is known that the largest percentage of car manufacturers’ profits come from sales of larger models. This rule of the market is simple and clear. However, this partly explains why manufacturers have been investing less and less in smaller and mid-sized models in recent years. It is clear that more money is made by selling SUVs or large and luxurious cars.

Manufacturers only get higher amounts from selling smaller cars if they increase sales. But the number of German models has a steady downward trend. Within a decade, the number of models was halved, from 24 to twelve. Models such as the Ford Ka and Opel Adam were not replaced. The German automotive magazine Auto Straßenverkehr recorded a decline in the number of small and medium-sized models between 2017 and 2022 from 17 to just eight. “The international shift towards SUVs is clear,” says Stefan Bratzel from the CAR Control Center in Bergis Gladbach. “In the category of large and luxurious cars, the market trend is upward. The share of SUVs in the market is constantly increasing.” In closing, Benedikt Meyer of the Automotive Economics Institute adds: “I don’t believe that in the medium term German car manufacturers will invest in small cars or affordable low-cost cars for mass sales.”