Germany's auto association expects the global passenger car market to grow moderately by 2% this year, taking it close but not fully back to its size prior to the pandemic, the VDA association said in a press conference on Tuesday.

Germany's passenger car market is expected to shrink by 1%, and remain 25% smaller than pre-pandemic levels this year, the association added.

Supply chains were once again intact, but the business environment for German carmakers remained challenging, VDA chief economist Manuel Kallweit said.

German electric car sales fell by 16% in 2023, according to VDA data, and were forecast to drop another 9% in 2024.

Still, production of electric cars in Germany was forecast to increase by 19% this year, the association said, with much of German output destined for export.

(Reporting by Victoria Waldersee Editing by Madeline Chambers)