While everyone else struggles with the global economic crisis there is one area of the motor industry that is doing rather well – German new car sales.

In February a report from the German Automobile Association showed a 21 per cent year-on-year increase. In March sales climbed by a massive 40 per cent.

The 401,000 new passenger cars registered in Germany in March represented the biggest volume for that month since 1992.

Dealerships across Germany are reporting continuing strong interest in affordable new models, and many are awaiting delivery of new stock simply to fill their showrooms.

In fact, overall sales in the first quarter of 2009 have risen by 18 per cent. All of which has led Matthias Wissmann, president of the German Automobile Association, to suggest that the German car market will top three million sales in 2009.

To put this in perspective, until recently overall sales were expected to sink beneath 2.1m.

This lift is almost entirely a consequence of Germany’s scrappage scheme, officially called the Umweltpraemie (environmental rebate). Scrap a car over nine years old and you get €2500 (£2283) towards a new one.