Makes sense, doesn't it? Besides offending large numbers of people, the symbol of the Nazi era represents a dark chapter in German history that the citizens of both countries would just as soon forget. A reminder of the shame and complete and utter defeat of Germany in World War II, the Hakenkreuz has no place in modern-day Europe.
According to Wikipedia (my emphasis):
The battle flag was never adopted by the Confederate Congress, never flew over any state capitols during the Confederacy, and was never officially used by Confederate veterans' groups. The flag probably would have been relegated to Civil War museums if it had not been resurrected by the resurgent KKK and used by Southern Dixiecrats during the 1948 presidential election.
In other words, two racist organizations.
Southern historian Gordon Rhea further wrote in 2011 that:
It is no accident that Confederate symbols have been the mainstay of white supremacist organizations, from the Ku Klux Klan to the skinheads. They did not appropriate the Confederate battle flag simply because it was pretty. They picked it because it was the flag of a nation dedicated to their ideals: 'that the negro is not equal to the white man'. The Confederate flag, we are told, represents heritage, not hate. But why should we celebrate a heritage grounded in hate, a heritage whose self-avowed reason for existence was the exploitation and debasement of a sizeable segment of its population?