Police said in a statement that one of the injured was seriously hurt. The suspect was seen getting out of the car with a knife and was later tracked down to near a swimming pool.
He is now in a hospital in Heidelberg having been shot by police while being arrested, leaving him seriously injured, they said.
Nine dead as truck ploughs into German crowd
Regional newspaper Rhein-Neckar-Zeitung said he was not fit to be questioned. Investigations by the public prosecutors' office in Heidelberg and the town's criminal police were continuing, police said.
Rhein-Neckar-Zeitung cited police as saying the suspect was a young German man. The newspaper said the suspect had stopped at a red traffic light and when it turned green put his foot down before hitting the group of people at high speed and smashing into a pillar.
The German authorities are on high alert after a failed Tunisian asylum-seeker drove a truck into a Christmas market in Berlin on December 19, killing 12 people.
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