The German car industry, one of the main drivers of the country's economy, is looking to the future with more confidence than it has in recent times, according to the Munich-based Ifo Institute for Economic Research.

In March, the business climate index in the sector climbed from a low of -9.9 points in February to reach -5.8 points.

Improved future expectations on the part of car manufacturers were largely responsible for the rise, with the index going up from -29.5 points to -18.7 points.

The German automobile industry seems now "to have finally left the economic low point in the second half of 2023 and is looking into the future with regained confidence," said Ifo researcher Anita Wölfl.

Export hopes driving optimism

Export prospects showed particularly positive growth, with a jump of 23.7 points to reach 13.8 points — the highest level since April 2023.

One reason for the increased optimism seems to be positive developments in the US and China, Germany's two main export markets.

In addition, only a few manufacturers reported supply chain problems.

The positive outlook among the key German auto industry may prove a boon for the rest of the German economy that has been forecast to see only low growth forecasts in 2024.

Carmakers' assessment of the current situation, however, showed a slight dip, falling from 11.9 to 8.1 points.

tj/ab (AFP, dpa)

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