Electric Cars Threaten the Heart of Germany’s Economy

https://www.nytimes.com/2019/12/31/business/electric-cars-germany-economy.html

by matt2000 • 7 years ago

152 316 7 years ago

grecy• 7 years ago

A lot of entrenched industries that make billions of dollars are being challenged, and will almost certainly have to drastically change or outright end if we have any hope of slowing climate change.

I suspect those earning billions are going to fight tooth and nail to do everything in their power to stop that happening.

kneel• 7 years ago

I suspect those earning billions are going to fight tooth and nail to do everything in their power to stop that happening.

The misinformation surrounding the leading manufacturer in EV for the last 2 years has been astounding.

Wohlf• 7 years ago

What misinformation is surrounding Renault-Nissan?

jamwaffles• 7 years ago

Won’t be any economy left if the planet is made uninhabitable. It’s like the most sacred thing is profit, not anything about the people that create it. Very odd train of thought.

growlist4• 7 years ago

Germany also shut its nuclear power stations in favour of more coal. I don't trust Germany.

Already__Taken• 7 years ago

Eh, nobody gets to make rational evidence based policy with nuclear, that ship has sailed. I think once fusion is cracked the 50-years away joke will just shift into the planning permission department.

jhayward2• 7 years ago

Germany also shut its nuclear power stations in favour of more coal

This is false. Germany replaced their nuclear capacity with, for the most part, wind and solar, plus natural gas.

Coal consumption in Germany is down by 50% since they began their nuclear drawdown.

kaybe• 7 years ago

We're pulling the coal plants down, and pushing to do it faster. (It may still not be fast enough, ok.) I'm more worried about the countries with no such plans.

smacktoward• 7 years ago

Relevant: https://www.newyorker.com/cartoon/a16995

api2• 7 years ago

We do need to phase out fossil fuels, but we must do so in a way that is not only physically and economically but also politically sustainable.

As we have seen, big changes of any kind that displace or destroy the livelihoods of vast numbers of people always lead to some form of populist or revolutionary revolt. Whether it takes a "left" (populist-socialist/communist) or "right" (national socialist) form depends mostly on which side is able to field the most compelling demagogue that can best harness the anger of the masses.

Abandoning fossil fuels must be done in a way that cushions the public and the economy somewhat or we will have a full scale populist revolt with slogans like "roll coal!"

AnthonyMouse2• 7 years ago

In this case what "we must" do isn't really in control of a single country. It turns out battery electric vehicles are viable now. Most of Germany's car sales aren't internal to Germany. If they don't produce competitive electric vehicles, Tesla will, or Rivian, or a dozen companies in China and all over the world.

Germany's choice isn't to start producing electric cars or to keep producing the same number of ICE cars they always did. It's to start producing electric cars or lose most of the market to new competitors.

And that means there are going to be fewer jobs making cars, because it's less labor to make an electric car. But you don't bail out the buggy whip makers, they just start making drive belts, or they go away.

icebraining• 7 years ago

The article is all about how there's much more at stake than just profits, including thousands of people's jobs. I don't disagree that there's plenty of greed clouding people's judgment, but this cartoonish portrayal is unfair. "Let him who is without an ecological footprint cast the first stone".

oceanplexian3• 7 years ago

There is pretty much zero chance of the planet becoming uninhabitable in the next few million years, so I'll save you a lot of anxiety. We're gonna be fine.

juanbyrge• 7 years ago

Source? We are destroying a lot of the negative feedback mechanisms (e.g. clearing rain forests, destroying the tundra, etc) what makes you sure we will be okay? A 4-5 degree Celsius increase in temperature is looking likely by 2100. If that is extrapolated out a few million years doesn’t seem plausible.

LoSboccacc2• 7 years ago

it's not electric cars that threatens German economy, it's delocalization to cheaper countries.

worldwide sales are sustained thanks to strong growth in China that offset other region contractions.

most brands have models ready to jump on the electric bandwagon anyway so the brand themselves aren't really threatened.

it's just plain old greed

syncsynchalt• 7 years ago

There are still two arguments to be made that electric vehicles themselves are a threat to the German auto industry, independent of cost or where the vehicles are made:

1) There are an order of magnitude fewer parts, due to replacement of the engine with battery + motor. The part count of ICE engines was the reason we have such a robust chain of suppliers, which are now threatened. There are also jobs lost due to loss of assembly and integration work.

2) Several German (and Japanese) auto manufacturers rest on the reputation of having the best engines in the business. Electric vehicles do not have engines. The brand halo from their engine expertise doesn't transfer directly to EVs.

LoSboccacc2• 7 years ago

Germans are famous for interiors and safety features, those translate well. also continuous improvement of their lines, I don't like the golf personally but when you get in one you feel the years of iteration and improvements. also transmission, and as a matter of fact they're already experimenting with that on the Porsche Taycan, produced in Germany and that's already doing 3k car/month without months of drama leading up the deliveries.

the rest is just an elaborate broken window fallacy, the economy will suffer not if they just shift the supply chain, as long as the job will be there.

Animats2• 7 years ago

The supply chain companies in Europe seem to be prepared. Continental has parts for gas, electric, hybrid, and Diesel cars.

Continental announced parts for self-driving, offering flash LIDAR, ruggedized computers, and actuators. But nobody got self-driving to production and ordered a few hundred thousand of those units. Must be frustrating being too early.

growlist4• 7 years ago

The Germany car industry should have seen the writing on the wall a few years back - when Merkel was forced to intervene to water down the European Commission's proposed emissions regulations - and disrupted itself, and if it had, it might have put them in a better position now. But even that would I think have been just forestalling the inevitable: the barriers to entry to the car industry seem to me to be lower than ever before, to the extent that even Vietnam - somewhere that was previously considered a 'developing' country - has its own home-grown electric car manufacturer, and I'm betting it's a lot cheaper to make cars in Vietnam than it is in Germany.

wolfi1• 7 years ago

In fact, they did see the writing, BMW for example developed the Hydrogen 7 [0], Mercedes Benz produced Fuel Cell cars[1]. What they didn't expect, was, that simple Lithium based batteries would take over. Obviously they wanted to retain the range of the combustion engine cars

[0] https://en.wikipedia.org/wiki/BMW_Hydrogen_7 [1] https://en.wikipedia.org/wiki/Mercedes-Benz_F-Cell

kevin_thibedeau• 7 years ago

VW had a skateboard platform concept EV 10+ years ago. They could have productized it if they had competent leadership.

adrianN9• 7 years ago

Hydrogen fuel cell concept cars were in the news for as long as I can remember. I consider them nothing more than appeasement to prevent stricter emission standards. German politicians have been prophesying self-regulation towards more efficient cars for more than thirty years now. What we got instead was a SUV boom and cheating on emission tests.

bertjk• 7 years ago

Turkey also: https://www.engadget.com/2019/12/29/turkey-togg-electric-cro...

I'm starting to think that the most significant consequence of the mechanical simplicity of electric cars is not the additional per-car reliability or potentially lower TCO. It is that manufacturing cars has suddenly become accessible to a much wider and geopolitically more diverse set of industrial bases. Maybe electric cars will be the new textiles where developing economies are concerned.

buboard5• 7 years ago

manufacturing cars has suddenly become accessible to a much wider and geopolitically more diverse set of industrial bases

It has always been. German companies manufacture parts or cars in cheap countries (like turkey). Yet there are no well-known hungarian or turkish cars

sho_hn4• 7 years ago

Both the Turkey EV (TOGG) and the Vietnamese EV (VinFast) are prototype cars made by Pinafarina in Italy, I believe. They're not as fully homegrown as one might think.

pfdietz11• 7 years ago

It also reminds me, at least a bit, of what happened to film and cameras when digital imaging took over.

agumonkey3• 7 years ago

The world is weird and complex, BMW had some L2 autonomous system late 80s. Nobody cared it ended up on a shelf somewhere.

ChuckNorris894• 7 years ago

BMW also didn't care about it since the main point of the BMW brand was driver engagement and sporty feel aimed at purists.

Autonomous driving goes against that mantra and was seen as something uncool, for old people who couldn't drive or something like that and would get you ridiculed by driving purists.

That, however, was before sporty cars became luxury cars and vice versa.

nosianu2• 7 years ago

The Germany car industry should have seen the writing on the wall

But that does not change anything!

The point is less workers will be needed. What difference does it make to "see the writing on the wall"? I don't even see any reason to look into the claim itself - it's completely irrelevant. Even if they adapt perfectly and Germany becomes a happy 100% electrical-car country, we will lose a lot of employment in the car industry.

growlist4• 7 years ago

we will lose a lot of employment in the car industry

This only increases the importance of hanging onto as many as possible of the shrunken pool of jobs that will be left.

ossworkerrights3• 7 years ago

Thanks to Germany, eastern Europe is a dumping ground for low quality, highly polluting German cars. A sad state of affairs and it shows just how the EU is biased towards a handful of countries.

ChuckNorris894• 7 years ago

It's not really Germany's fault. It's our fault in the East for the vanity of prioritizing low cost second hand luxury vehicles above our health and not holding the government accountable for the lack of a functioning public transport system. The Romanian railway system is a national embarrassment.

Germany isn't dumping anything, it's just supplying the demand coming from Eastern Europeans who make lengthy trips there with platform trailers to bring back cheap second hand luxury vehicles that are now longer economically viable there.

I've seen way more BMW X5s and Audi Q7s in Romanian cities than in my time working in Germany and Austria combined. I don't think the Germans came and shoved them down our throats.

Where Germany is at fault is its lack of action after Dieselgate since it decided to protect VW and its executives rather than the health of the EU citizens that are still having their lungs stuffed with diesel particulate from the tens of thousands of TDI engines happily roaming around us.

kfk• 7 years ago

Meanwhile in Italy they are building lithium battery factories and working on converting diesel buses to electric. The infrastructure shift will be huge and new companies will need to raise to tackle that. For instance, Tourin has circa 800 buses for public transport today - you cannot charge all of them at the same time now as there is no infrastructure and not enough power in the grid. I somehow think that if even Italy is embracing electric as the “next thing” while Germany automakers still firmly hold their heads in the sand then it could be a pretty bad blow for Germany in the coming decade. Amazingly enough all of this could still be avoided if German automotive companies accept for once that the world is changing, will they though.

* http://www.rainews.it/dl/rainews/media/Vrooom-La-prima-fabbr...

pintxo• 7 years ago

Considering the story about the burning (diesel) busses in Rome last year [1], maybe switching to batteries is not such a good idea for Italy?

[1] https://www.nytimes.com/2018/05/10/world/europe/rome-explodi...

ulfw• 7 years ago

You can't charge 800 buses in Torino but you can charge 8000 in Shenzhen? What's wrong with the Italian grid if this is true?

Someone• 7 years ago

Population of Turin: 880k or 2.2M for the metropolitan area (https://en.wikipedia.org/wiki/Turin, https://en.wikipedia.org/wiki/Metropolitan_City_of_Turin)

Population of Shenzhen: 12.5M or 23M for the metropolitan area (https://en.wikipedia.org/wiki/Shenzhen)

⇒ the Torino grid need not be worse than the Shenzhen one for that to be true.

peteretep2• 7 years ago

I would expect almost all Italian infrastructure to be older than the Chinese equivalent, and still paying off the capital needed to create it.

mjpuser• 7 years ago

I think one contributing factor slowing down progress is the cost of electricity in Italy. It's €0.24/kwh vs $0.06/kwh in the US (at least in PA). You dont see any electric cars in Italy, and it seems super expensive to them. I’m also not sure if there is a tax on top of that €0.24 from what I remember my cousin telling me. I’m hitting a language barrier confirming this.

torpfactory2• 7 years ago

I think the issue with bus charging is that if you want to plug in all those busses at their various depots and charge overnight, the electrical infrastructure can’t support the new load (multiple megawatts per depot). Bus depots were never wired for that kind of load.

You literally need to build new substations and wires to service a fleet of busses. I think there is probably generation capacity but it might not be deliverable to where it’s needed.

whatitdobooboo• 7 years ago

It's hard to replace such a manufacturing oriented work culture in any country, especially one revolving around cars in general. I think Germany will be fine, it's still early.

tonyedgecombe• 7 years ago

Within Europe it's the UK that looks weakest right now. Domestic sales and exports have both plummeted despite the pound dropping. The new trade deal between Europe and Japan lessons the need for Japanese manufacturers to have European plants. Honda have already announced they are leaving. Even the prestige manufacturers are struggling.

peteretep2• 7 years ago

Nearly six million vehicles are produced in Germany each year, and approximately 5.5 million are produced overseas by German brands

1.5m produced in the UK ... a large chunk of which are for German brands.

The UK automotive industry may be fucked, but the German one is 4 times bigger, and also directly exposed to Brexit and weakness in the UK industry.

lispm4• 7 years ago

1.5m produced in the UK

Many of them made for exports - especially to the EU. This is the problem. This will be less profitable and more complex. Currently Britain is in the EU and seen as an entry to that market. This will be gone soon.

Much of that manufacturing looks to move to the EU.

epx• 7 years ago

It was funny to see some colleagues that moved from here to Germany to work on automotive industry, and almost overnight started to defend "stopgap" alternatives like hydrogen ICEs... IMHO the biggest advantage of an electric car is the 10x gain on mechanical simplicity, I don't care if it costs the same to own and operate.

gambiting2• 7 years ago

Why would a regular customer care about mechanical simplicity at all? For 99% of people the car is a magical black box where you put fuel in and drive it. From time to time you need take it to a car doctor to replace something that might as well be a quantum fusion exchanger diffuser for X amount of dollars just so they can drive again. The last two values you say are of no importance to you are of biggest importance to everyone else - the car can have literally whatever under the bonnet, the cost to own and operate are the only two things that matter to anyone. There are certain idealists around for whom the car not burning fuel is a thing worth paying more for, but most people only ever look at the cost of ownership and nothing else.

Ygg2• 7 years ago

That's something that IMO should change as well. Too many things means too much wasted material.

CydeWeys2• 7 years ago

The customer will certainly notice low maintenance costs.

buboard5• 7 years ago

i think simplicity is a good selling point, but the dependence on the power grid and charging utilities is an even bigger, negative point. i think it's underestimated how big of an issue charging will be.

jacquesm4• 7 years ago

Last I checked the German car industry was doing fine. Detroit however looks more and more like a scene from some apocalyptic movie. And then there is Japan.

Animats2• 7 years ago

Ford is going electric in a big way. Coming in 2020, the electric Mustang, for which pre-orders are now full. Electric F-150 pickup in 2021.

"Ford says that they can produce 50,000 vehicles in the first 12 months" on the Mustang. That's kind of small, but Ford can probably ramp that up as needed.

Toyota is now making electric car noises but is only selling (or not-selling) that hydrogen-powered thing.

jacquesm4• 7 years ago

Toyota is pretty much the market leader in hybrids and has been since the beginning, if and when they decide to go all electric I really don't see what would hold them back.

jillesvangurp• 7 years ago

Not just the German economy. Much of the traditional US and Japanese car (and truck) industry is at risk too. Complacency leading to a lack of R&D is enabling new comers to ship products and establish themselves. Toyota, Mazda, BMW, Chrysler, etc. have in common that they don't seem to have plans to mass produce EVs in a market where Tesla is taking the #1 position in several key markets. It's not a given that any of them will survive while their market shares crumble, typically starting with the most lucrative segments. The supply industries around them are suffering a similar fate.

fernly• 7 years ago

Somewhat relevant, "The Tesla Effect: How Tesla Is Changing the Used Car Game"[1]. People who buy Teslas typically trade in high-end imports, causing a drop in the used-car prices for Audis, Beemers, etc.

[1] https://www.capitalone.com/cars/learn/finding-the-right-car/...

nradov• 7 years ago

Used luxury cars have also become less reliable and more extensive to maintain. The mechanical and especially the electrical parts have become more complex and failure prone. Potential buyers understand that even a minor problem out of warranty will cost thousands to repair, so I suspect that's another factor in lower used car prices.

neonate• 7 years ago

http://archive.md/qfoN9

aaomidi2• 7 years ago

German automakers not only stopped their R&D to develop the next generation of cars. They focused their R&D on figuring out the best way to cheat on emissions testing (https://en.wikipedia.org/wiki/Volkswagen_emissions_scandal)

None of the German car manufacturers actually made any worthwhile EVs, and it always seemed like they're making EVs just to satisfy EU lawmakers.

Meanwhile across the ocean, a company with essentially no production line history is able to completely destroy century old companies because they got complacent.

German car manufacturers deserve everything coming to them

Scoundreller2• 7 years ago

None of the German car manufacturers actually made any worthwhile EVs, and it always seemed like they're making EVs just to satisfy EU lawmakers.

To be fair, this is most legacy automakers.

fennecfoxen2• 7 years ago

To be fair, electric vehicles are generally unprofitable and people who buy cars prefer not to pay more money for less impressive capabilities.

Spending money to develop products that you can't sell at a profit is not generally a winning strategy, which is why the EV market is sort of a waiting game, in which automakers try to time their investments against various government subsidies and regulations — knowing that the moment it really is a more profitable approach, your competitors will all be flooded with capital and trying very hard to seize the same markets that you are after. (Heck, if you do too well against them, you could see government intervention to prop up your competitors in the name of saving jobs, whether the US government or otherwise. See also: the Renault/Nissan merger proposal that made Ghosn a political target. They were trying to do joint work on EVs to keep costs down, and the merger would be the next step — but Nissan is Too Iconic and Important to Japan™ to allow it.)

amelius• 7 years ago

Perhaps developing an electric vehicle isn't that difficult, as Tesla shows, and German carmakers are just waiting for the right moment.

rmoriz• 7 years ago

EVs are simpler products that make lots of knowledge and experience useless. And the most expensive part of EVs is the battery made by Asian companies.

So it you start "too early" you introduce negative scaling effects on your highly profitable combustion business AND have to invest a lot upfront for the EV models.

There is no way to win this game, many workers will lose their jobs and also initial investments will affect profit and dividends. If you are too slow, Tesla will take the profitable segments anyway.

icelancer• 7 years ago

Do you think the same about reusable spaceflight?

clouddrover5• 7 years ago

German car manufacturers deserve everything coming to them

What's coming to Volkswagen is that they'll be the world's biggest producer of EVs. It's not that surprising. After all, they are the world's biggest car company.

2020 is the start of Volkswagen's big EV push. This is what Volkswagen's 2020 EV plan looks like:

- VW e-Up!: https://www.carscoops.com/2019/09/vws-updated-e-up-offers-16...

- VW e-Golf (sold over 100,000 but will be replaced by the ID.3): https://www.youtube.com/watch?v=ah4lrqWx8E0

- VW ID.3: https://www.youtube.com/watch?v=IPjvgXWA78E

- VW ID.4: https://www.autocar.co.uk/car-news/motor-shows-frankfurt-mot...

- SEAT Mii: https://www.electrive.com/2019/09/11/seat-mii-available-to-o...

- SEAT el-Born: https://www.youtube.com/watch?v=DZI7WFtwc8g

- Cupra Tavascan (maybe, not confirmed): https://www.youtube.com/watch?v=YNYHRKp4n1w

- Skoda Citigo iV: https://www.autocar.co.uk/car-news/new-cars/new-skoda-citigo...

- Skoda Vision iV: https://www.youtube.com/watch?v=-f1g9xl6W_E

- Audi e-tron (and also the new "sportback" variant): https://www.audiusa.com/models/audi-e-tron

- Audi e-tron Q4: https://www.youtube.com/watch?v=DiwevzHsCbU

- Audi e-tron GT (maybe 2021): https://www.youtube.com/watch?v=tMEdiq2xTbQ

- Porsche Taycan (and the Sports Turismo wagon variant in future): https://www.porsche.com/usa/models/taycan/

More models in 2021 and more in 2022 and so on.

The Volkswagen ID.3 will be a big seller in Europe and then later on in China. It's a popular form factor with good range at a good price.

Shivetya• 7 years ago

by end of 2021 they only expect 330k total BEV vehicles globally.. that is not a big push from a company making over ten million cars per year. now they expect to reach a million per year by 2023 but that still keeps their percentage very low.

the simple truth is, no they aren't trying very hard. they have to cater both to politicians and unions at home neither of which can sustain the job losses BEVs will lead too; not just in the manufacturing but it cascades into after market, petrol refining, gas stations, and more.

pmorici8• 7 years ago

Taycan and e-tron are both huge flops so far and the ID.3 is off to a bad start as there are reports that they are having massive problems with the cars software and are literally building the cars and plan to store them in a lot for a year while they sort out the software issues.

https://electrek.co/2019/12/19/volkswagen-id3-has-massive-so...

bencollier49• 7 years ago

"VW e-Up!"

Oh dear, that name doesn't translate well into British English. Sounds like it's made in Yorkshire..

ThePhysicist5• 7 years ago

I think that view is a bit simplistic. Tesla is catering to upperclass and upper-middleclass people. 90 % of people in Germany either wouldn’t be able to afford or wouldn’t be willing to pay 50.000 € (what the cheapest Tesla model costs here) for a small sedan when they can get a Diesel car with similar capabilities for 20.000 € or less. And honestly most people don’t care much about emissions, they care about usability and ease of use, and there gasoline cars are just much more convenient than electric cars right now. I have several colleagues that drive Tesla and I find it a bit awkward that they have to plan their hotels and schedule around the available charging infrastructure even for small distances (e.g. for going from Berlin to Leipzig to attend 36c3). EVs would be awesome if the charging infrastructure was there but it isn’t and it won’t be for several years to come.

faserop• 7 years ago

Curious which German made Diesel cars costs 20.000 € or less. I get the impression from Germans that EVs are not a good solution to replace diesel. Perhaps there just isn't motivation of the populas behind the techonology. Which could be blamed on the lack of infrastructure to support charging. Also in the United States a lot of people have garages that they can install charging stations in. I wonder what the percentage of Germans who have a private garage is.

YZF• 7 years ago

Berlin to Leipzig is 193km... shouldn't be a problem for a long range Tesla to do the return trip. I'm sure there's plenty of chargers? There's a supercharger right by Leipzig.

I haven't been to Germany in a long time but when I last visited luxury vehicles were quite dominant. Also doesn't gas cost a lot in Germany? Wouldn't that make the total cost of ownership even more compelling for EVs?

pmorici8• 7 years ago

If you own a Tesla the infrastructure is there. Our family regularly takes cross country trips in our Model 3. It is more convenient than our gas car because AutoPilot makes driving long distances on the highway much much easier.

Charging has never been an issue for us, Tesla's SuperCharger network is excellent and routing to chargers on long trips is seamlessly integrated into the car's software using Google Maps.

As for cost, the cost of a base model Tesla has come down more than 50% in the past decade. I highly doubt price reductions stop there. One more 50% reduction and these cars will be on par with the cheapest compact gas cars available today.

baybal22• 7 years ago

Tesla is a rather simple car at the price of S500 and stretched S600 if fully loaded.

Now, have you ever experienced the level of comfort you get even in the most basic sonderclasse? Tesla simply doesn't feel like a true luxury car.

walrus01• 7 years ago

In 2Q 2019, USA market, the Tesla Model 3 outsold the combined total of BMW 3 series, Audi A4 and Mercedes C/E class.

https://cleantechnica.com/files/2019/08/Tesla-Model-3-vs-Lux...

ijidak• 7 years ago

The thing that gets me is electricity is EVERYWHERE in the developed world.

There are already libraries and other public places that slap a couple of EV chargers in the parking lot.

This was never feasible with gasoline.

It seems that when EV's are common enough, we may reach a tipping point where EV chargers are as ubiquitous as parking meters and free/paid wifi at current business establishments.

Today, a cafe almost can't stay in business without offering WiFi and laptop chargers.

The same may happen with EV charging.

Also, once EV battery capacity doubles (not far-fetched) the density of chargers will become even less important.

And, at that point, ICE cars will be at a staggering disadvantage to EV's, because it easier to put a paid charger in every parking space than it is to expand the ubiquity of gas stations.

And it's also harder to boost the range of ICE vehicles.

Zanni• 7 years ago

I see this argument ("similar capabilities for 20.000 € or less") a lot, and I'm not buying it. I supposed it depends on what "capabilities" you're talking about (number of passengers?), but a Tesla is going to be faster, quicker, safer, cheaper to fuel and cheaper to maintain than any 20.000 € car I can think of.

wink• 7 years ago

I'd be onboard with your view if it wasn't for BMW and Mercedes. (And Audi a bit). None of those are cheap. Not Tesla-expensive, but there aren't really any cheap Mercedes or BMW, and they do sell a ton of those. Tesla is not "too expensive" for people buying new S class or 5/7 series.

buboard5• 7 years ago

tesla is not aiming at VWs audience. They make sexy, expensive and fast cars that target the market of ... porsche cayenne? It's not clear if tesla's model will lead to economies of scale that will make these cars cheap. it's a bit premature to say that they 'll destroy old companies. There are already pretty good EVs like the jaguar I-pace , but they dont have mass market appeal. If tesla manages to cut into VWs profits, i think you ll see a lot of EVs being pushed out fast.

zarkov99• 7 years ago

I don't think that is fair. The Japanese, Korean, Italian, French and other Americans still have not made any worthwhile EV cars either. It's Musk's drive that is the anomaly not German complecancy.

adev_• 7 years ago

The Japanese, Korean, Italian, French and other Americans still have not made any worthwhile EV cars either.

That's wrong. And pretty US centric.

The Japanese / French have the Nissan Leaf and Renault Zoe that have excellent sells in their respective countries. They however do not fight on the same ground than Tesla.

rapsey• 7 years ago

Except Italian makers I see way more EV cars from those manufacturers on the road then Tesla in my corner of Europe.

zapnuk• 7 years ago

While this is true. It is also short sighted.

1. They don't need much time to catch up. The VW ID 3 has solid specs and costs significantly less than a Model 3.

2. Combustion cars will still be around for quite some time. If not in EU/USA/China then in emerging countries.

Retric2• 7 years ago

The VW ID 3 is not coming to the US, has a 45kWh battery, 50kW charging, and 50 mile shorter range for $33,180. So both in terms of specs and availability it’s still significantly behind the Model 3.

Size wise it’s about 17 inches (429mm) shorter, which may not be a bad thing. However, it shows they are making real sacrifices to hit that price point.

pmorici8• 7 years ago

"They don't need much time to catch up."

People have been saying this for a while now and all evidence points to it being radically wrong so far. There were numerous new entrants in the EV market this year billed as 'Tesla Killers' and all of them turned out to be massive flops so far because none of them come close to Tesla's range/features and price.

The most recent example of this is the Porsche Taycan which was originally billed as having 311 miles of range when first announced. Once the production model was rated according to the EPA standard it turns out it's range is only 201 miles. You can't buy a Tesla that bad at any price and the Starting price of the Porsche is 50% more expensive than the most expensive Tesla Model S.

Similar stories played out with the Audi Etron, and Jaguar Ipace.

As for the VW ID3, Porsche is owned by VW. If they can't make a great electric car for $150k how the heck are they going to make one to compete for 1/3 that cost? There are even early indications the the ID 3 could be a huge fiasco [0] They are running into huge software problems and are stock piling ID 3's in a storage lot until they have time to fix the software.

[0] https://electrek.co/2019/12/19/volkswagen-id3-has-massive-so...

rsync• 7 years ago

"They don't need much time to catch up."

How would we know ? None of the german automakers are making any of their cars electric.

They are making electric cars - iMobiles and eMachines and Tron-mobiles - one-off islands of manufacturing and design that have no connection to their actual product lines.

These are characterized by model-specific very gaudy exterior design flourishes, big seas of screens on screens on screens in the interior and, worst of all, performance numbers that are cautiously restrained by the existing ICE lines they don't want to cannibalize.

We don't want your electric car. We want your car, electric.

Wake me when there is an electric 7 series or Range Rover or A8 (or Volvo v90).

rasz2• 7 years ago

VW ID 3

https://electrek.co/2019/12/19/volkswagen-id3-has-massive-so... solid is not a word that comes to mind

agumonkey3• 7 years ago

VW is being heavily watched by people on reddit. The ID platform has regular news. I don't know the details but it seems VW has changed course substantially.

lowdose• 7 years ago

"German quality" turned out to be German marketing.

sesuximo• 7 years ago

BMW i3 is an excellent electric car

PhantomGremlin2• 7 years ago

Yeah, if you want to go around the block a few times before you run out of juice.[1] A lot of Americans need much longer range.

The EPA range of the 2017 and older models was 81 miles. For about a year I did a one-way commute of about that distance. Only for 2019 did BMW come up with a somewhat reasonable range of 153 miles.

I don't take the REx variant seriously. They are a really bad joke. Why not add an IC engine merely to get to a 200 mile range? And at the same time lower your electric-only range to 126 miles because of the added weight. That's beyond stupidity.

Even with all that, I can't buy a new BMW i3 locally.

The Beaverton dealer claims to have 231 vehicles, exactly zero battery vehicles: https://www.kunibmw.com/new-inventory/index.htm

The Portland dealer claims to have 111 vehicles, exactly two BMW-i vehicles. They are both i8 at about $170,000 each: https://www.bmwportland.com/new-inventory/index.htm

[1] https://en.wikipedia.org/wiki/BMW_i3#Fuel_economy_and_range

sneak2• 7 years ago

Tesla has not, as yet, either turned a profit or “completely destroy[ed]” a single “century old company”.

If you remove the constraint of operating profitably, many companies can do the impossible. :)

(I am not saying Tesla won’t be profitable, or can’t be, or that the German automakers don’t deserve some blowback for poor choices—just that you are making false claims and also comparing apples to oranges.)

netsharc• 7 years ago

I wonder if Volkswagen Group (one of the biggest carmakers, they own VW, Audi, Bentley, Lamborghini, Bugatti, Seat, Skoda) is waiting for the right moment to buy/take over Tesla... Just one stupid tweet might be all it takes.

xedeon2• 7 years ago

Tesla has not, as yet, either turned a profit

This is false. https://qz.com/1734436/tesla-turns-a-profit/

sandworm1016• 7 years ago

That's a total oversimplification of two very different auto markets. Germans relate to their cars very differently than do americans, including on environmental issues.

For one, Germany has a much more well-developed public transport network. An eco-minded German is much more likely to park their car and take a bus/train etc. So if you take the bus/train regularly, you don't feel so bad about having a diesel car for use when you need it. Contrast that with Tesla's home turf: California. Public transport there is ludicrously bad. The car is king. So, lacking proper public transport options, the eco-minded californian will consider electric options much more readily.

I have never met a Tesla owner on a bus or train in north america. I have met many German BMW/Merc/Porche owners on European trains. I have met plenty of Tesla owners on aircraft, going on their holidays. I do laugh at the irony of all those Teslas parked at SFO. How many of their owners are flying business class or better? How many of them have extensive solar panels on their houses? Electric cars in north america are more of a fashion statement than they are in europe.

Another big market difference: Engine size. Germans prefer smaller engines and make them work. Americans prefer larger engines that putter along at 10% capacity. Another: transmission preferences. US = 98% automatic, Germany = <30%. The markets are so different that any direct comparison can only happen after extensive couching of every statistic.

option2• 7 years ago

while either extreme is bad, I find it much more comfortable in CA vs Germany. Have you ever been in people traffic in subway during rush hours? Throw in flu season on the mix. I’ll take car traffic any day over that.

Electric self driving cars (land a lot of related infrastructure sounds much more compelling then anything Germany or Europe has to offer right now

micheljansen3• 7 years ago

If you move over one country and look at The Netherlands, you’ll see a lot of the same things hold true there, yet Tesla (and other EVs) are wildly successful there. Key differences are EV tax breaks and excellent public charging infrastructure in a smaller, denser country making EV ownership practical and economic. The same people absolutely do drive EVs and use public transport, usually combined with some bicycle rides mixed in.

Cougher• 7 years ago

"I have never met a Tesla owner on a bus or train in north america. I have met many German BMW/Merc/Porche owners on European trains."

There is so much wrong with drawing conclusions from these experiences, which itself is "a total oversimplification of two very different auto markets" and public transport markets as you yourself have noted, in addition to the fact that Tesla owners are still a very small minority of car owners which is reason enough that you'd be unlikely to meet one on a train.

"I do laugh at the irony of all those Teslas parked at SFO . . . Electric cars in north america are more of a fashion statement than they are in europe."

You seem to be skewing your view of EVs in America toward Tesla owners so that you can skewer Tesla owners.

nl5• 7 years ago

Every single point in this comment is wrong and yet it is the highest voted comment here.

1) They didn't stop all R&D except how to cheat on emissions tests. They cheated on emissions tests but their R&D remains very high.

2) Both BMW (the i series) and Porsche have got excellent electric cars.

3) Tesla hadn't destroyed the German manufacturers. They are all profitable and sell more cars than Tesla

I'm a big Tesla fan, but there's no need to make stuff up. The German manufacturers have challenges, but they remain successful, innovative companies.

sho_hn4• 7 years ago

German automakers not only stopped their R&D to develop the next generation of cars.

https://www.statista.com/statistics/346985/research-and-deve...

edraferi• 7 years ago

Paywall - what’s your point?

thdrdt• 7 years ago

Tesla is not destroying any company. I don't know why you think they do.

In the USA the market share of light trucks was 73% in Q3 2019. Those are 100% not Tesla's.

Tesla's revenue is ~23% of BMW group's revenue. Impressive for sure but they are not destroying anyone.

It is also estimated that if Ford and VW bring an EV on the market they will easily sell 100k units with their first model.

The world market is bigger and different than you think. The German brands are loved in China. And markets like Brazil are upcoming.

thrower123• 7 years ago

In fact, while Ford, for instance, is gutting their sedan offerings, they are making money hand over fist in SUVs and light trucks.

mymythisisthis4• 7 years ago

American 'trucks' are terrible. The USA has a huge import duty on light trucks, really good ones are kept out. Import duties, cheap gas, and CAFE rules on station wagons skew the market in the USA in favor of light SUVs

lispm4• 7 years ago

German automakers not only stopped their R&D to develop the next generation of cars.

Volkswagen is currently running a multi-billion euro initiative for the next generation of cars.

eeZah7Ux2• 7 years ago

Amazing how people keep blaming VW and Germany! They are not the worst offenders, by far:

https://en.wikipedia.org/wiki/Diesel_emissions_scandal#Previ...

https://en.wikipedia.org/wiki/File:Nitrogen_oxide_on-road_em...

NicoJuicy• 7 years ago

Over reaction, but Tesla still feels like plastic/cheap ( interior) to me.

They are eating some lunch from some carmakers, but not as much as you think.

Eg. Tesla was #11 in sales in September 2019. Some "hybrids" are absolute shit though.

And this is with a lot of EV tax incentives.

esotericn• 7 years ago

So how about, in 2020, you make a car that's as good as the 2012 Model S?

It's absolutely bonkers that the car manufacturers are still playing catch up to a car that's almost a decade old at this point.

Tesla are on their fifth model, third complete rework, and the 'traditional' manufacturers still have their dick in hand.

Take a bog standard sedan, put a 200-300 mile range battery in it, sell it for the battery cost more than the ICE version, scrap the ICE line before the government forces you to, job done.

This is going to be the car industry's collective Kodak moment if they don't pull out soon.

russdill• 7 years ago

Add to that while battery prices and electric motor prices are dropping, the price of developing and producing internal combustion engines continues to rise due to stricter and stricter emission standards.

SEJeff5• 7 years ago

And the double whammy that those ICE manufacturers are having to purchase carbon credits from EV manufacturers like Tesla.

https://www.businessinsider.com/tesla-sold-carbon-emissions-...

TMWNN• 7 years ago

Take a bog standard sedan, put a 200-300 mile range battery in it, sell it for the battery cost more than the ICE version, scrap the ICE line before the government forces you to, job done.

I'm surprised no auto maker has yet to my knowledge a) done the above and b) advertise this fact. I'm envisioning a two-page print ad, showing two identical cars side by side, with a headline challenging the reader to answer "WHICH ONE IS ELECTRIC?"

Brakenshire3• 7 years ago

There are a lot of cliche comments here about Dieselgate and German manufacturers vs Tesla. The threat isn’t Tesla, Tesla will do very well but isn’t going to take over the world, it’s that manufacturing EVs doesn’t need a lot of the established supply chain, and doesn’t need the same level of employment. Mercedes, VW, BMW etc will be fine, but a lot of their specialised suppliers will go bust, and a lot of jobs will be lost.

esjeon• 7 years ago

My guess is that, as more companies hop on the EV train, they will spend more on interior features, like better onboard computer, seats, default options, etc. I also believe that the price of car will remain similar even after complete transition to EV, because the real factor here is purchasing power, not production cost. If these turn out to be true, not so many people will lose job, but most will have to change their profession.

bnt• 7 years ago

Saying that a metal worker can easily switch to a leather craftsman sounds a bit simplistic, no? Many jobs will be lost, new ones will be created in their place, some people will switch careers, others will be left unemployable. A lot of German (and EU) education machinery focuses on the current gen car industry, and that’s not sustainable in the long run. So they will have to reinvent their educational system as well.

weinzierl• 7 years ago

I agree with everything you wrote and while I also believe that "a lot of their specialised suppliers will go bust" I think that at the same time there are big opportunities for the suppliers and some will prosper.

The reason is that I believe electronics and software will become ever more important. Traditionally the German manufacturers have outsourced anything to do with software and even most of the electronics. They have no internal knowledge about software what so ever - every bit of software know-how is at the suppliers. That's why I think that at least some of the suppliers will be better off in the future than the manufacturers themselves.

And it is also a question of human resources. In the past and for a long time software developers at German car manufacturers have been looked down on by all the "real engineers" who are in charge. As a software dev you have been much better off at a supplier. This is changing but in my opinion it gives the suppliers a good head start on capable staff for software projects.

ChuckNorris894• 7 years ago

This. German auto makers are now just huge armies of managers and consultants since they outsourced most tech/software R&D to suppliers (Bosch, Continental, etc.) to reduce costs by having the suppliers take the financial risks associated with R&D.

Outsourcing R&D was a typical MBA move since it meant they could keep a lot more money in their pockets and have the suppliers bid each other to the ground on price, however, this now means the suppliers have most of the cutting edge tech now and are free to sell it to other lower tier manufacturers which in the past had no resources for advanced tech.

So now you can have a Hyundai with the same tech as a Merc since they all have the same Bosch/Continental ECUs with some minor tweaks meaning the main selling point of the luxury brands is now the design, badge and perceived brand value rather than any proprietary tech.

This is what drove the major suppliers to halt R&D investments in Germany and expand massively in Eastern Europe in a quest to bring costs down and increase their success in the bids for future contracts.

Zigurd• 7 years ago

Electric cars accelerated some trends already in motion: The simplicity of electric cars dropped the last few barriers to *horizonalization." As with PCs and smartphones, all players have access to all parts. Vertically integrated players like Apple and Samsung retain some advantages, but are constantly challenged at every horizontal layer by specialist suppliers.

There are about three dozen car manufacturers in China. They will thrive in a horizontalized car business.

_bxg12• 7 years ago

“There is a transition toward more electric vehicles that have far fewer components and are easier to manufacture,” Bernhard Mattes, the president of the German Association of the Automotive Industry, said in an interview in Berlin. “Therefore, we can expect less employment.”

Any major leap in efficiency eliminates jobs. It causes turbulence as people have to shift jobs or even industries, but it's not really a reason to not do something and it typically works out in the long run.

wffurr2• 7 years ago

In the short run you have a bunch of angry out of work voters who can throw a monkey wrench into things.

Government and industry need to work together to provide a humane transition for workers and regions dependent on the old way of doing things.

_bxg12• 7 years ago

Agreed

sho_hn4• 7 years ago

Side note: Mercedes owned a 10% stake in Tesla early on and had an electric B-class with a Tesla power train briefly.

99chrisbard• 7 years ago

European EV cars don't compare to Tesla

https://www.youtube.com/watch?v=zSjYra7cYqY

Vervious• 7 years ago

The whole point of technology is to make processes more efficient. This in turn drives down prices and increases productivity.

If it takes fewer people and factories to make a more sustainable vehicle, so be it.

This is also the force that propels long-term economic growth (as long as the political system continues to support it). To fight it, and make the auto-industry less competitive, is good for Germany in the short run but the last thing they should do in a long-term horizon.

BrandoElFollito5• 7 years ago

I would love to have an electric car but beside nearby trips (office, some grocery) I also drive say twice a year for vacation.

I just checked the way from home (western suburb of Paris) to a ski resort (Val Thorens)

2 x 40 min stops, on the same way as all of the region driving to ski with me.

This is simply impossible, I spend maybe 4 minutes at the pump, there are 10 of them at the station.

To have the equivalent in electric chargers, there should be 40 or 50 of them, with a nuclear plant nearby to bring in the amperes.

By then if batteries are 3 times the capacity and 10 times the charging speed, this will be competitive to fuel. Otherwise it stays as a second car solution, for regional (local) trips

adrianN9• 7 years ago

You could rent an ICE car for your long trips. Depending on your regular usage it could still be cheaper for you than paying for gas.

BrandoElFollito5• 7 years ago

I understand that. I was rather trying to point out hiw far, logistically, we are from mainstream adoption - just because of life constraints (such as vacation)

Brakenshire3• 7 years ago

I don’t really understand the strength of your response, it’s a 6-7 hour trip, wouldn’t you want to stop anyway? Stop off at a restaurant near a 50kW charger, the fuel savings will pay for a good meal, and then you’ll only need another 20 minute top up to stretch your legs at some other point of the trip. And even if you never wanted to stop, this is, what, five hours over the course of a year, it just doesn’t seem that important, for instance what about the time you save from never having to visit a petrol station in daily use of the car?

BrandoElFollito5• 7 years ago

No, what I meant is that this is not going to be 2x30 minutes, but 2x(30 min charge + n x 30 min waiting in queue for the chargers because there are not enough of them). Vs 10 fuel pumps where people spend 3 min.

When the proportions are reversed then EV make sense for trips with other purple taking the trip at the same time on the same road (as this is the case in France for school holidays)

marvin2• 7 years ago

I did three 12-hour road trips Norway this year, 2 of them in a borrowed Tesla Model S. The Model S trip was less tiring than the fossil car trip. Same amount of stops, only difference is we plugged in the Model S the two times we had a 30-minute break.

If 60 minutes of stopping on a 12-hour drive is a dealbreaker to you, you should go with a fossil fuel car.

BrandoElFollito5• 7 years ago

When the proportions are reversed then EV make sense for trips with other purple taking the trip at the same time on the same road (as this is the case in France for school holidays)

eeZah7Ux2• 7 years ago

"threaten", as if it was a bad thing.

The world desperately need energy-efficient, sustainable public transport and cities designed around it.

The electric car will not save us. Trains and bicycles might.

known• 7 years ago

German exports cars, cars and cars https://twitter.com/spectatorindex/status/113918565976628019...

Electric Cars Threaten the Heart of Germany’s Economy

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