Plug-in hybrids are rarely loaded. But is that why the hybrid drive is a climate sham?
Düsseldorf There is a lot of discussion about hybrid drives in Germany – and not just because of the latest battery problems. Critics say that the partially electric vehicles are pure greenwashing by the car manufacturers. The double drive train makes the cars heavier, often they weigh well over two tons. Drivers, on the other hand, seldom charge the batteries of their cars out of convenience.
You drive without electrical assistance, the combustion engine has to carry the additional load on its own and therefore consumes more. The low CO2 emissions are therefore only available on paper. But are hybrid vehicles really just a sham package? A look at the development of the drive – and its effects.
Toyota was the first automaker to make hybrid drives suitable for the masses. In 1997 the Prius came on the market. A full hybrid that draws electrical energy through recuperation, i.e. energy recovery during the braking process. Where that is not enough, the internal combustion engine comes into play. However, the energy carrier is petrol accordingly; instead of a lithium-ion battery, a nickel-metal hydride battery was used.
The advantage: A full hybrid does not have to be charged at the charging station. The Toyotas Prius is therefore not dependent on a close-knit charging network. The disadvantage: purely electric driving is only possible at very low speeds and over short distances.
But purely electric driving wasn’t even the goal of the Prius. It was just about supporting the combustion engine in order to reduce consumption and CO2 emissions. And it succeeded. The second generation of the Prius, which came onto the market 16 years ago, emitted just 104 grams of CO2 per kilometer.
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Beijing, Berlin, Düsseldorf In view of the economic growth in China, German industry is drawing hope for its own export business. Car manufacturers, mechanical engineers and logisticians are reporting growth. “Business in China is going well again,” says the Cologne engine manufacturer Deutz. The mechanical engineering company Trumpf is also looking forward to attractive business.
The International Monetary Fund (IMF) and the World Bank are currently expecting that China will be the only large economy with growth in relation to the full year with around two percent plus. “The official Chinese figures must always be viewed with suspicion,” says Gabriel Felbermayr from the Kiel Institute for the World Economy to the Handelsblatt. “But the good trade data in particular are hard numbers.” Because they are confirmed by the relevant statistics from China’s trading partners.
The fact that the upswing in China is sustainable despite all the doubts about the official statistics is also shown by the figures from German corporations. Even in normal times, China is the most important sales market for German cars. Now the People’s Republic is even mutating into a lifeline for an otherwise starving industry.
The main reason for the surprisingly good result is the rapid recovery in business in China. While Mercedes sales in China fell by a fifth compared to the same quarter of the previous year in the first quarter as a result of the corona lockdown, after nine months the sales statistics show an increase of 8.3 percent compared to the first three quarters of 2019.
In the third quarter alone, Mercedes delivered 224,000 cars to customers in the Far East – an increase of more than 23 percent compared to the same quarter of the previous year. The result: The dividend from the joint venture with the Beijing state-owned company BAIC amounts to a whopping 1.2 billion euros and thus represents more than a third of Daimler’s total operating profit in the third quarter.
“Asia is definitely the locomotive,” says BMW CFO Nicolas Peter when looking at the global sales figures. In the third quarter alone, BMW sold 30 percent more cars in the People’s Republic than in the same quarter of the previous year. Since the beginning of the year, the Munich-based company has even sold twice as many cars in the Far East as on the once dominant US market.
Competitor Audi even reports “the best performance since entering the market 32 years ago” for the third quarter in China, wrote Stephan Wöllenstein, China chief of the parent company Volkswagen, on LinkedIn.
The large German logisticians and mechanical engineers are also reporting that business in Asia is picking up again. “Freight traffic between Asia and North America has increased sharply throughout the industry,” says Deutsche Post. “There is also considerable demand for transport between Asia and Northern Europe.” Hapag-Lloyd, the largest German shipping company, has made a similar statement.
Other countries in the region such as Vietnam, Indonesia and Cambodia have also significantly expanded their exports again in the past few weeks – and have thus made a significant contribution to the recovery. After both Deutsche Post and Hapag-Lloyd cut their forecasts at the beginning of the pandemic, they have corrected their profit forecasts for the current year upwards again in the past few days. Shipping company world market leader Maersk also raised its expectations again last week. Container shipping companies and sea freight forwarders are currently benefiting from the steep rise in freight rates.
“Germany benefits from recovery in world trade”
So is China going to become the growth engine for the global economy again, as it was ten years ago after the financial crisis? Marcel Fratzscher, President of the German Institute for Economic Research, believes this is possible because China was able to successfully contain the virus and restart its economy faster than Europe and the USA.
“Germany is benefiting greatly from the recovery in world trade, which is being driven primarily by Asia and China,” Fratzscher told Handelsblatt. The economic recovery in China is more robust than in most other parts of the world, as the government in Beijing has launched large stimulus programs and the Chinese economy is less and less dependent on the rest of the world.
China expert Max Zenglein, chief economist at the Mercator Institute for China Studies (Merics), doubts that China will pull the world out of the recession. Like Fratzscher, he is convinced that the economic recovery in China will continue in the fourth quarter. “But the expectation that China will become the locomotive for the global economy is wishful thinking,” he told Handelsblatt.
For one thing, the growth in China is not enough for this. On the other hand, the trade balance is different from ten years ago: “China’s exports are growing much faster than imports,” said Zenglein. It is therefore not ruled out that China’s export industry will suffer setbacks if the upturn in the buyer countries is a long time coming.
In the first three quarters of the year taken together, China’s growth was in any case only 0.7 percent higher than in the same period in 2019. Even if the world’s second largest economy will still achieve an increase in gross domestic product (GDP) of around two percent in 2020 as a whole, as the IMF and World Bank expect, this would be the lowest growth rate in decades.
Official figures from the People’s Republic, experts have warned for years, should be viewed with caution anyway. Local governments often report embellished dates to Beijing in order to be better off in front of the central government. Because of the assessment basis alone, the Chinese GDP figure cannot be compared with the values for Germany, for example. The economist Michael Pettis from Peking University points out.
In most countries, including Germany, the actual value added is measured when calculating GDP, i.e. what is actually produced and what services are provided. In China, on the other hand, the measurement is based on input – and this input in the form of state investments is largely determined by the government itself.
This is also the case this year: the recovery has so far been based primarily on the increase in industrial production, which is dominated by state-owned companies, and state infrastructure projects. “The Chinese GDP is a political figure and does not capture the true economic conditions,” commented Shezhad Qazi, Managing Director at the US analysis company China Beige Book, which specializes in the Chinese economy.
With all due caution towards Chinese statistics, IfW President Felbermayr is nevertheless convinced: “China has clearly supported the current German economic development, and this dynamic can continue to carry over the coming months.”
Because from June to August, German exports to China were 4.3 percent above the value of the same period in the previous year, while exports to the rest of the world were 11.4 percent below. But the impetus is manageable because only seven to eight percent of German exports go to China.
Alternatives to business in China
From China and Asia, it is mainly furniture, household appliances, kitchen and bathroom items that are shipped to Europe – products that are needed in your own four walls during the pandemic. In the opposite direction, notes a spokesman for Hapag-Lloyd, there is particularly strong demand from the Chinese side for chemicals and raw products. On the routes from Northern Europe to Asia, the level of the previous year was reached again after the massive slump in spring.
Business is going well again not only with China, but also with other Asian countries such as South Korea, Vietnam, Indonesia and Singapore, emphasizes Siemens boss Joe Kaeser, who is also chairman of the Asia-Pacific Committee of German Business (APA). At the APA annual conference on Monday, Chancellor Angela Merkel and Minister of Economic Affairs Peter Altmaier (both CDU) as well as Kaeser warned the industry to look for more alternatives to their business in China in Asia in the future.
They cited two reasons: the Chinese government’s declared policy of wanting to become less dependent on high-tech imports, and the temporary supply bottlenecks during the corona crisis for products that were only sourced from China, such as protective masks.
The fact that German economists also currently believe in the sustainability of the Chinese upswing is primarily due to a number from Monday: demand in retail. It has lagged significantly behind the recovery in industrial production since the beginning of the year, but is now showing a slight trend reversal. Retail sales in September increased by 3.3 percent compared to the previous year. Analysts had expected an average increase of around 1.8 percent.
In August, the number rose slightly by 0.5 percent for the first time since the corona crisis. The “big jump” in September shows “that consumption has stabilized further,” wrote Iris Pang, China chief economist at Bank ING, “and there were also signs of more spending by the economy.”
In the course of the year so far, however, the retail sector is still down by 7.2 percent. The slowly recovering private demand is also based primarily on rising sales of luxury goods and cars.
Overall weak consumption is a particular problem for China, as growth in the world’s second largest economy has relied more and more on private consumers in recent years. Designated in June
Zhang Bin of the Chinese Academy of Social Sciences (CASS), which is under the auspices of the State Council of the People’s Republic of China, described the sluggish demand as “worrying”. China’s Prime Minister Li Keqiang recently pointed out that it was important to stimulate consumption.
Growth target is set
Starting next Monday, the country’s political leaders will meet for four days at the highest level to discuss the so-called 14th Five-Year Plan. The plan is intended to set the Communist Party’s goals from 2021 to 2026, especially for the economy, and will apply from the beginning of next year.
Usually a growth target is also set there. However, reports in Chinese state media suggest that there may not be such a determination this time around.
In the end, the further development depends above all on whether China continues to keep the number of corona cases under control. Occasionally, small, locally limited outbreaks had triggered violent countermeasures by the local authorities. Entire neighborhoods were quarantined after an outbreak in Beijing in June. A huge Covid-19 mass test was only ordered in the port city of Qingdao at the beginning of October after individual new cases became known.
Apart from that, everyday life in the People’s Republic is largely normal. Millions of Chinese had once again traveled around the country for “Golden Week”, a week of public holidays.
More: The pandemic strengthens China’s role in the global economy, says Handelsblatt reporter Stephan Scheuer.
The MEP Michael Bloss (Greens) argues with Eckart von Klaeden, the former CDU politician and current head of politics and external relations at Daimler AG, about the consequences of EU climate policy for the car industry.
Stuttgart – The EU wants to sharply tighten the climate targets for 2030. MEP Michael Bloss (Greens) and Daimler manager Eckart von Klaeden are discussing the consequences for automobile construction, one of the key industries in the southwest.
The corona pandemic and the increasing departure from the internal combustion engine are troubling Daimler. Works council boss Brecht calls on the top management to take their corporate responsibility seriously and not to pass the changes on to the workforce.
In the dispute over the Daimler component plants in Germany, which are dependent on the combustion engine, the works council wants to prevent planned outsourcing to suppliers. “We do not accept that our locations are bleeding out, and instead we are outsourcing production to external companies,” said Michael Brecht, Chairman of the Daimler General Works Council. The works council is also opposed to the relocation of products to Daimler locations in Eastern Europe with lower wage costs.
“In times of strong growth we were able to absorb such shifts. But now the wind is getting rougher and we are positioning ourselves differently.” Daimler wants to turn its car subsidiary Mercedes-Benz inside out to electromobility in the coming years and gradually phase out internal combustion engines. Last week, Daimler boss Ola Källenius presented a new plan for this, which includes a second, purely electric car architecture. “Basically, I am glad that we now have a clearer direction towards electrification,” praised Brecht, who so far has always criticized the management for lacking a strategy. “The basic strategy is good and correct. But the ramp-up of electromobility brings problems with it.”
The component and engine plants at the headquarters in Stuttgart-Untertürkheim as well as in Berlin, Hamburg and Kölleda are under pressure to change. Works councils from Untertürkheim and Berlin warned that according to the company’s plan, around 5,000 jobs should be cut in their plants by 2025. Daimler does not officially provide any figures for this.
New processes and structures
“It’s easy to say, I’ll take everything away and relocate it – but whoever does that is avoiding corporate responsibility,” criticized Brecht. The works council boss does not deny that jobs will disappear with the switch to less labor-intensive electric cars. But not so many jobs should be lost so quickly. Instead, processes would have to be changed. “The people deserve management to think about new structures.”
For the motivation of the workforce it is not good if the media reported on the shedding of tens of thousands of jobs. However, the Daimler works council is not planning a wave of protests from employees like the one that is currently running at the supplier Continental against plant closings and job cuts. “I am counting on sensible discussions with the management first. I believe that we will find solutions,” said Brecht.
Mobility services not a core business
Because of the prevailing cost pressure, Brecht advised that the commitment to car sharing and other mobility services be discontinued. “A year ago it was said that without mobility services we would no longer be able to survive, otherwise we would become dependent on digital platform companies,” said Brecht. In the meantime there has been great disenchantment with the business prospects of the services operated jointly with BMW in the “Your Now” joint venture.
The fear that sharing services could suppress the desire to have one’s own car has so far not come true. The slogan “From automobile manufacturer to mobility service provider” disappeared from Daimler’s company presentations some time ago. “We are not at a point where sharing models become widely accepted. Even (the US driver service operator) Uber is burning a billion after the other,” said Brecht.
With the switch to electric cars and the Corona crisis, the pressure to save on the production sites is so high that the carmaker does not have to “blow out” any money for such services. “If we are not able to turn it into a profitable business and now see that we are not dependent on platforms as supplicants, the question arises: Do I have to do that at all?” Said Brecht. Under the label “Now”, Daimler and BMW have been operating the car sharing “Share Now”, the taxi and driver services “Free Now” and “Reach Now”, the “Park Now” app for finding a parking space and the charging stations together since the beginning of 2019. “Carge Now” platform for e-cars. The centerpiece is the station-independent short-term car rental, which Daimler started with “car2go” in 2008 and which BMW offered three years later with “DriveNow”.
The electric car maker Tesla delivered almost 140,000 cars in the third quarter, exceeding expectations. The group has not yet commented on the finances. Most recently, however, the company had made money for four quarters in a row.
The electric car manufacturer Tesla is recovering rapidly from the sales misery during the pandemic-related restrictions. For the third quarter, the US group posted record sales figures. Accordingly, the company handed over 139,300 cars to customers between June and the end of September. That was 44 percent more than a year ago.
Tesla exceeded the expectations of the analysts, who had expected 137,000 vehicles. The previous quarterly record was 112,000 in the final quarter of 2019, which was not yet affected by the pandemic.
In the first nine months, Tesla delivered 318,000 vehicles, although the factory in Fremont, California, had to close due to the pandemic. Tesla set a goal in January of selling over half a million vehicles this year. That would be an increase of more than a third over the previous year. But that also means that a good 200,000 cars have to be handed over in the last three months of the year.
The group produced 145,036 electric cars in the reporting period. A good 128,000 of these were accounted for by the more compact Model 3 and Model Y, and another 17,000 by the larger Model S and Model X. Group boss Elon Musk said in September that he wanted to ramp up production to 20 million cars a year within a decade. That would be about twice as many as Volkswagen, the world’s largest car company in terms of sales, built last year.
Information on the financial position will only follow later with the annual report. Tesla had last made four quarters in a row with a profit for the first time since the company was founded in 2003. In the coming year, the first Tesla factory in Europe is due to start production just outside Berlin. More than half a million cars a year are to be produced here in the future.
Düsseldorf The almost 60,000 Continental employees in Germany have the sad certainty after the Supervisory Board meeting on Wednesday: 13,000 of them at 25 locations will most likely no longer work for Conti by 2024. More than every fifth job in Germany is at risk.
Employees from a tire factory in Aachen are particularly affected. Around 1,800 jobs will be lost here by the end of 2021. In addition, the supervisory board approved the closure of the Karben site in Hesse by the end of 2024 and a significant reduction in jobs in Regensburg.
“We are aware that this is a painful process that the automotive industry and we will have to cope with now and in the years to come. At the same time, it opens up new, profitable growth opportunities in a fundamentally changing world of mobility, ”said Supervisory Board Chairman Wolfgang Reitzle.
“This majority decision by the supervisory board was unfortunately to be expected,” said the deputy chairman of the supervisory board and Vice-IG Metall boss Christiane Benner: “Conti is not living up to its social responsibility.”
Because of the slump in the auto economy and the accelerated structural change, Conti tightened the austerity program from last year at the beginning of September. Not 7,000 jobs, but now 13,000 jobs in Germany are available. Worldwide, the number of jobs at risk has increased from 20,000 to 30,000. In this way, the group wants to increase the annual savings amount from 500 million to one billion euros from 2023.
In total, the management board expects the renovation to cost 1.8 billion euros. Of this, 660 million euros were already booked last year. The remaining 1.2 billion euros are to be offset in the current financial year.
The management around CEO Elmar Degenhart has been exposed to massive criticism from all sides for weeks. IG Metall and IG BCE spoke in advance of a “clear cut”. North Rhine-Westphalia’s Prime Minister Armin Laschet (CDU) accused the management of “cold capitalism”. Labor Minister Hubertus Heil (SPD) showed no understanding for Conti’s “radical job cuts program”.
Benner told the Handelsblatt: “The Continental management has turned against the employee side like never before.”
Continental has long since become a projection screen for the sleepy structural change in the automotive industry, for which, according to the trade unions, its own employees, especially in Germany, have to be responsible.
Degenhart spoke to Laschet on the phone
It was then the tire factory in Aachen that changed the mood. Two weeks after management publicly announced its tightened austerity measures, the company said in mid-September by posting Let the employees know that they will lose their job by the end of 2021 due to capacity adjustments.
The IG BCE reacted angrily because the Aachen plant is actually operating profitably. According to the union, this step was not agreed. And the state government around Prime Minister Armin Laschet (CDU) was not informed in advance by Conti about the measures.
In a conversation with journalists after the supervisory board meeting, CEO Degenhart admitted that the way in which the measures were communicated and published in Aachen had not gone well. “We could have done better,” said Degenhart. “Since then I have phoned Mr. Laschet twice and apologized for this action.”
But Degenhart does not change the decision itself. “We wanted to make a decision now rather than two or three months from now and in this way not raise false hopes.”
The plant in Aachen would be closed due to overcapacity in European tire production. The decision was made in favor of Aachen because, according to Conti, it is “the smallest and most cost-intensive location in the company’s entire European production network”. In the meantime, Conti has also started the first exploratory talks with the state government and the city of Aachen.
The Executive Board sees a problem in the sustained decline in car production figures. Conti wants to solve this by increasing the value of the components that the supplier delivers for each vehicle. This can only be achieved with the help of innovative products that require high spending on research and development, said Degenhart. And that in turn would have to be financed through a positive cash flow. As a result, management was forced to make quick decisions.
“The time pressure results from the economic situation. In the past few months we have burned billions of euros in cash, ”said Degenhart. “Without countermeasures we would have even bigger problems,” said the 61-year-old.
IG Metall, on the other hand, blames management errors from the past for the current situation. In the profitable years from 2009 to 2018, Degenhart’s group management bought growth with numerous takeovers and inflated the structures. Management is now trying to dismantle these inefficient structures. But: “It is no longer clear at all where this group wants to steer in the long term,” Benner told the Handelsblatt. “We have been calling for a strategy and concepts for months.”
Although Conti has a coveted product portfolio and is considered a leader in the sensor technology sector, the core business with auto components in particular suffered from a lack of earnings even before the Corona. Employee representatives criticize the still complicated structures in the automotive sector. The spin-off from Vitesco has been prepared, but after several postponements, no specific date is given for an IPO.
Christiane Benner announced that the Conti management will have to prepare for tough negotiations after the supervisory board meeting. Then it must be clarified how the measures are implemented site by site. “We demand perspectives, further training and qualifications, instead of blunt redundancies,” said Benner.
The tone between the employee representatives and the corporate board has become rougher. At the end of June, it still looked as if the management were looking for socially acceptable solutions. Personnel manager Ariane Reinhart threw a collective reduction in working hours into the room, coupled with further training opportunities in the time that was freed up. This should save as many employees as possible into the new era of electric mobility and software.
According to trade union circles, the first talks were promising. But then came the big break on September 1st. The employee representatives say that the management has published the significantly sharpened austerity program without prior consultation.
Aachen plant will not be relocated
The unions suspect that Conti is seizing the opportunity to relocate jobs to countries with lower wage costs during the crisis. This is also the case in the case of the plant in Babenhausen in Hesse, where Conti has vehicle displays such as speedometers produced. Some of the positions are being relocated to Serbia. According to the company, the tire plant in Aachen is not an issue with regard to relocations.
The new scope of the austerity measures and the way in which Conti is implementing them surprised many employees and industry observers. When speaking to works councils and trade unionists, many suspect the chairman’s handwriting behind the tough measures. “Take a look at what Mr. Reitzle has done with Linde Praxair,” said a district manager of IG Metall.
As the head of the supervisory board, the 71-year-old had pushed the merger of the industrial gas manufacturer with Praxair. The company is operated from Ireland and the USA by Linde Praxair CEO Steve Angel. Job cuts in Germany have been on the agenda since then. But the truth is also that at the same time the merged company’s sales and profits increased significantly.
The criticism of the Conti management board from supervisory board circles is nevertheless partially devastating. The auto supplier is “strategy-free”, they say. The management entrenched itself in the ivory tower and showed no willingness to negotiate. Conti broke taboos and permanently damaged the image and corporate culture.
How much the Continental brand is suffering is shown by an online petition against the austerity measures that Group Works Councilor Hasan Allak has started. Over 22,000 people have signed the petition. Even VW works council boss Bernd Osterloh took part and called for signing via Instagram.
“The Continental Supervisory Board has ignored all protests and appeals from colleagues as well as criticism from politics and governments,” said Group Works Council Allak from IG BCE. “But these decisions reinforce our determination to use all our strength to create perspectives for the colleagues concerned in negotiations with the board of directors.”
More: There is still no end in sight to the wave of layoffs in the auto industry.
On the test bench, the car consumes significantly less fuel than in regular operation, and carbon dioxide emissions are also reduced by manipulation. Porsche is said to have obtained the approval of various vehicle types with false information and at the same time deceived the customers.
Porsche moves into the focus of the public prosecutor’s office because of possible manipulation of fuel consumption. “We have initiated an investigation,” said a spokeswoman for the Stuttgart public prosecutor of the “Frankfurter Allgemeine Zeitung” according to the preliminary report. “There is a suspicion that, due to manipulation of certification measurements, Porsche AG vehicles did not have an effective type approval, that buyers were misled about actual consumption and that tax evasion occurred as a result of indirect perpetrators.” Four people were accused.
The investigators’ allegations relate to the years 2007 to 2017. The magazine “Business Insider” had previously reported that the sports car manufacturer belonging to the Volkswagen Group had manipulatively throttled the consumption and thus the carbon dioxide emissions of gasoline engines of older models on the test bench. Porsche employees had told the internal auditing department that different gears were used in the transmission of test vehicles than in series production, the magazine reported.
As a result, a lower fuel consumption was recorded during type approval than in road use. Porsche said the investigation initiated by the car manufacturer itself in cooperation with the Federal Motor Transport Authority (KBA) is still ongoing. In individual cases there may be deviations from the series status. It is about vehicles that were developed a few years ago. “There is no evidence that vehicles in ongoing production are affected,” added Porsche.
According to the KBA, it concerns gasoline engines that were produced for the European market before 2017. At the end of August, the KBA announced that it had not found any deviations from the type approvals for gasoline engines from current production. The temporarily suspended type approvals became valid again.
Thundering bass sounds through the huge exhibition hall, a rapper in a baseball cap enthusiastically performs his verses, followed by three dancers in miniskirts and fishnet tights. The latest models from automakers are enthroned between them: dozens of SUVs, as huge as street armor, freshly painted in mint green and bright red. The video bloggers present enthusiastically whip out their selfie cameras.
The festive mood at the Beijing auto show that started on Saturday is well founded: the fact that around 80 brands can present their latest innovations on 200,000 square meters in Corona year alone is a demonstrative victory against the pandemic. In China, this currently seems possible because the health authorities simply barely register any infections – the capital Beijing has been virus-free for over 50 days.
Of course, strict rules still apply: visitors are only allowed to enter if they pass a camera with facial recognition software. Then they have to scan the “health code” on their smartphone, which proves that they have not traveled to a risk area in the last 14 days. The mask requirement also applies, but visitors to the Chinese capital no longer adhere to it too strictly: After a cigarette break in the courtyard or lunch in the cafeteria, the mouth and nose protection remains under the chin for some.
However, China’s most important auto show does not run off normally: While German was still a kind of unofficial official language in the corridors in recent years, there will be practically no foreigners to be seen in 2020. The vast majority of board members from Europe skipped the trip to China, probably to save themselves the two-week mandatory quarantine in a state-assigned hotel room.
But the expats present on site also remained unusually lazy, questions at the press conferences were undesirable. There are enough explosive topics: for example, forced labor in the Muslim province of Xinjiang, where Volkswagen also has a plant. Instead, the speeches on the stands of Daimler and Co. resembled downright hymns of praise for the Chinese market.
Indeed, this one is one of the rare success stories this year. After a brief but massive slump of almost 80 percent, sales have now been rising again for five months. As of August, vehicle sales even recorded a solid plus of 11.6 percent compared to the same period in the previous year. The “golden season” for car purchases in China has only just begun.
In the Middle Kingdom, German luxury cars in particular continue to enjoy great popularity. Daimler sells more than a third of all S-Classes in China worldwide; Often it is a question of young clients, for many it is even their first car purchase. Volkswagen also sells around 40 percent of all cars on the Chinese market and is currently investing two billion in catching up in the field of electromobility. For older Chinese in particular, driving a black Audi through the streets of Beijing is still considered particularly prestigious – that brand was considered particularly popular among powerful party cadres just a few years ago.
The gold rush mood of local carmakers seemed to be over long ago, and after two years of stagnation it threatened to give way to a serious hangover. But the corona crisis, which was overcome comparatively quickly in China, has significantly changed the situation: While the industry in Europe and the United States is still suffering massively, China has once again become the hope of the German auto industry. More critically, the dependence on the Chinese market – and thus also on the Chinese government – is increasing.
In contrast to the high-class gasoline-powered vehicles, for which “Made in Germany” still stands, the Chinese competition focuses primarily on electric cars. »BYD«, »Geely« and »Dongfeng« are the names of the brands that very few in Europe have ever heard of – at least for now. Most of them will try to do well abroad in the years to come. In terms of design and technical equipment, they have massively caught up with the traditional brands.
Driven by generous purchase incentives and state investments in technical infrastructure, the People’s Republic has long since developed into the largest producer and market for electric cars – more than half of all vehicles powered by electricity drive in China. The goals for the next few years are ambitious: By 2025, the Chinese government plans that vehicles with alternative drives will make up at least 15 percent of the market.
Until now, Markus Söder was not necessarily known for driving the auto industry ahead of him. But now he is starting an unusual foray in an equally unusual alliance with the Federal Environment Agency. The greens rub their eyes in amazement.
The head of the Federal Environment Agency, Dirk Messner, and CSU boss Markus Söder want a ban on cars with internal combustion engines from 2035. “California has shown the way,” Messner told the newspapers of the Funke media group. “I think a ban on new registrations for diesel and gasoline engines from 2035 is a good idea.”
Söder said on Saturday at the CSU party congress: “I am very much in favor of us setting an end date from the point at which fossil burners with fossil fuels can no longer be approved.” And further: “What it was like in California seems to me to be a very good date for it.”
The most populous US state of California wants to drastically reduce car emissions and only allow emission-free new vehicles from 2035 – Governor Gavin Newsom announced on Wednesday. So gasoline and diesel should slowly disappear.
For a transitional period and in view of the Corona crisis, Bavaria’s Prime Minister Söder renewed his call for a car purchase bonus or the like for the most modern combustion engines: An incentive system, a recycling bonus or an exchange voucher could be used in a few years when buying an even more modern car . Messner, on the other hand, emphasized: “We don’t need heavy SUVs and off-road vehicles in our cities, but smaller, more economical and future emission-free cars.”
Green parliamentary group deputy Oliver Krischer said of the initiative of the Bavarian Prime Minister: “We welcome Markus Söder’s change of heart at the end of the internal combustion engine. That is a gain in knowledge that we hardly expected. Hopefully this is not just one of his show numbers, because it is absurd , the end of the internal combustion engine, but at the same time still demanding purchase premiums for new ones. The environmental protection organization Greenpeace made a similar statement.
Criticism of the idea came from the FDP. The Party’s First Parliamentary Managing Director, Marco Buschmann, tweeted: “First want to score points with car manufacturers with purchase premiums for combustion engines, but then demand a production ban. Typically Söder!” Synthetic fuels could make burners climate-neutral.
In Bietigheim in Baden-Württemberg, 290 Bosch employees fear for their jobs. The management of the auto supplier wants to move production abroad. Last week, as a protest, the works council and IG Metall organized a human chain around the company, in which I also participated. Because it’s a mess that locations that employees have built up over decades are simply relocated!
Bosch is not an isolated case. The German auto industry is in a deep crisis. Manufacturers and suppliers such as Continental and Mahle have announced plant closings and mass layoffs. The managers blackmail the workforce: They demand concessions such as increased workload and wage cuts, entice them with a few years postponement or social plans. But that is not a solution for the employees who worry about their future and often have to pay off their apartment or houses.
The union and works councils are now obliged to organize all workforces in the auto industry to join forces so that locations and workforces are not played off against each other. We have to fight for every plant, every job and every euro of wages.
The current arguments are about who is paying for the crisis. As a reminder: Daimler, VW and BMW had retained earnings of almost 180 billion euros last year. The chairman of IG Metall, Jörg Hofmann, recently discussed a four-day week. But in order to secure jobs, business solutions cannot stop there. A general reduction in working hours with wage compensation is the best way to keep industrial jobs and distribute work more fairly.
Many workers have long known that classic capitalist approaches – waiving wages for the workforce plus state-subsidized purchase bonuses – cannot solve the crisis. What is needed is a master plan that supports the industry in switching to alternative production. What is needed is a state transformation fund to help develop new production lines and train employees. Funds from this fund must be linked to job and income guarantees as well as more participation.
The time is ripe for a comprehensive turnaround in traffic through the expansion of local transport, rail and other networked mobility offers. This secures industrial jobs and creates hundreds of thousands of new jobs. The fact that striking bus drivers protested last week together with activists from Fridays for Future for the expansion of local transport and affordable ticket prices gives cause for hope. The solidarity of the many is necessary to put the government under pressure.