German sales had been boosted in 2009 by a state-funded car scrapping scheme that expired in early September, and had been expected to fall as the subsidy was removed.

A total of 294,500 vehicles were sold last month in Germany, the biggest European car market, a VDA statement said. Overall auto production climbed however by 27 percent to 555,300 vehicles, and exports leapt by 51 percent to 419,400 units.

And “in March alone, German auto manufacturers recorded a jump of almost 29

percent in foreign orders,” VDA president Matthias Wissmann was quoted as

saying.

German car makers were hit hard by a global sector crisis last year, though Volkswagen, the biggest European manufacturer, fared better than rivals as buyers boosted by cash-for-clunker subsidies ordered smaller, cheaper autos.

This year, the German market “will certainly not reach record levels set before the crisis, but we are expecting a good year for exports,” Wissmann said.

The auto sector has begun to consolidate via alliances to lower research and development costs, and Daimler, the German maker of Mercedes-Benz, is set to join Renault of France in a deal that would see them share know-how in building smaller cars.

German industry experts think that, by cooperating with Renault, Daimler could make savings of €600 million ($800 million) in its development sector.