Think that BMW North America’s move to offer one-day-only heavy discounts on July 31 just to get one over Mercedes-Benz is the only act of questionable ethics in the business these days? Well, you had better reconsider, as things seem to be much worse in Germany.

Yes, you read correctly, Germany – the country that is supposedly immune to the financial crisis that is threatening the rest of the Eurozone and its very existence.

The numbers provided by the ACEA, the European automotive industry association, show that in the first half of the year the German car market grew 0.7 percent.

In stark contrast, ACEA reports that the Italian and French car markets experienced a decline of 20 and 17 percent respectively during the same period. As the saying goes, there are lies, damn lies, and there are statistics.

According to a Bloomberg report, things are not quite as peachy as they seem in the automotive sector of Europe’s strongest economy. That’s because 87,454 vehicles, which account for 29 percent of total sales, were registered to dealers and car companies according to data from the German auto-dealer group ZDK.

Adding insult to injury, ZDK reports that total “self-registrations”, as they’re called, have increased by 11 percent in the first six months of 2012 compared to last year, to 479,385 vehicles.

These cars are subsequently sold “as new” with a discount that may exceed 20 percent of the list price, despite having zero kilometers on their odometers.

“It’s a bloodbath from a discount point of view”, Andy Palme, Nissan’s executive VP for global planning told Bloomberg News. “We work in an industry that needs volume, it needs to move metal, so manufacturers discount.”

Even recently introduced models by premium manufacturers, such as the all-new sixth generation3-Series, are discounted.

“Every day customers are coming to our showroom with offers from other brands or other BMW dealers”, says Entenmann of Autohaus Entenmann near Stuttgart that sells about 2,200 cars a year. “This is part of our daily routine.” Profits, he admits, are down as the discounts eat into margins the company’s margins.

On average, new-car discounts in Germany have reached 12 percent in July. Fiat tops the list, with 14.7 percent, followed by PSA Peugeot Citroen and Renault with 14.1 percent.

“Everyone is chasing the last remaining consumers in Europe, and all the cars that can’t be sold somewhere in the south are now being shipped to Germany”, explains Credit Suisse analyst Arndt Ellinghorst.

Note: The German words in the title translate to “this is mad/crazy/insane/wacky/daft” – you can pick whatever you feel is more appropriate…

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