“There is no consumer demand for electric cars.” For two decades, this has been the mainstay of traditional automakers’ arguments against electrification. Well, now the demand for electric vehicles in Europe is booming, and German automakers unfortunately find themselves unprepared. Not only are they not building enough vehicles, but the continent’s fast-charging infrastructure appears inadequate for the next wave of electric vehicles (Tesla now has nearly 5,000 superchargers in 24 European countries, while the Ionity consortium has none. than 1160 to date).
Tesla, which of course never bought into the self-defeating ‘no demand’ argument, quickly built up its production capacity and charging infrastructure, and is now preparing to open a factory in the backyard of the Germans. In honor of the opening of the baseball season, let’s use an American cliché and say they’re going to have to play some serious catch.
A few years ago (until around the end of 2016), Europe, apart from a few hot spots, namely Norway and the Netherlands, was far behind the United States in terms of EV adoption. This dynamic is now reversed and Europe is quickly becoming the engine of the global EV industry.
The growing demand for electric vehicles is largely the product of government policy: European emissions regulations force automakers to build electric models, and purchase incentives encourage drivers to buy them. Germany recently increased its maximum subsidy for electric vehicles to 9,000 euros ($ 10,460), and Austria, France, Spain and the UK also offer substantial incentive programs. Whatever the impetus, the surge in sales is undeniable: in June, the market share of plug-in vehicles exceeded 8% in the three largest European car markets.
As Simon Hage and Martin Hesse write in the German news magazine Der Spiegel, German manufacturers are far from ready to meet the growing demand. They have a wave of new electric vehicles in the works, but it will be another 6 to 18 months before most of them hit the streets. The launch of VW’s new flagship EV, the ID.3, has been delayed by software glitches. And of course, increasing the production of existing models (like the e-Golf, which has been around since 2015) takes time and investment.
“Car manufacturers suffer from bottlenecks, especially when it comes to battery cells,” Roman Zitzelsberger, member of the Daimler supervisory board, told Der Spiegel. The magazine reports that buyers ordering new electric vehicles have to wait up to a year, and German brands have stopped taking new orders for some of their electric models.
Ironically, the problem facing the German giants is reminiscent of the “valley of death” that Tesla crossed with the Model S, then with the Model 3: companies have invested billions of euros in the development of their new electric vehicles. , but if they can’t get them to market fast enough, the damage to their reputation and bottom line could be enormous.German brands, which have always considered themselves to be at the forefront of automotive technology, must be puzzled that the best-selling electric vehicle in Europe today is Renault’s tiny and unglamorous Zoe. Worse, in several markets, the Tesla Model 3 exceeds anything the Germans have to offer. Even in Germany itself, VW is barely clinging to the top spot: in the first half of 2020, the e-Golf sold 7,320 units, the Zoe was in the lineup with 7,066 sales, and Tesla’s Model 3 was climbing fast in the mirror with 4367.
So, What is happening? Can’t the Germans see in which direction the electric wind is blowing? No, that’s not the problem. They know what to do, and VW, for its part, is moving in the right direction – the company has fully converted its Zwickau plant to electric vehicle production and has started doing the same at its plant in Emden. Daimler is building several battery factories, hoping to break the stranglehold of Asian suppliers and bring battery production to Europe.
These companies are spending what looks like huge sums on electrification, but relative to the scale of their production of ICE vehicles, their electrical efforts are still small potatoes. The real problem with all of the traditional automakers around the world is that they still believe they can make a gradual transition to electric vehicles over the decades, while still selling many very profitable gasoline SUVs.
There are pro-EV and anti-EV factions within all of the major auto companies. Markus Duesmann, Audi’s new CEO, seems to embody the contradiction. Duesmann was formerly an executive at BMW, where he was involved in the development of the company’s i3 and i8 models, which put BMW at the forefront of electric vehicle development. But the company lost money on the i models, and after a change in leadership it more or less gave up on its electrification push. Its next generation of EV is not expected until 2021.
At Audi, Duesmann oversaw the creation of the Artemis project, which brings together an independent team of specialists from across the VW Group to work in a “start-up atmosphere” to develop new electric and autonomous vehicle technologies. On the other hand, he recently said in an interview that ICE vehicles “will be alive for a very long time” and that Audi will continue to “invest heavily in the development of combustion engines”.
Ralf Brandstätter, the new VW brand manager, made similar comments in an interview with auto motor und sport (via CleanTechnica), saying VW has been offering ICE models for a long time. “We always said we would have different types of propulsion on a level playing field in the long run.”
In Europe and the United States, car dealerships have also erected electrification barriers. Auto motor und sport reported that VW CEO Herbert Diess wanted to replace the existing ICE versions of the tiny Up! Passat city car and luxury sedan with electric models, but dealers canceled both moves, so gas versions of both cars continue to live on.
According to Der Spiegel, when Audi CEO Duesmann heard about Tesla’s planned Gigafactory Berlin, he laughed out loud – not in ridicule, but in wonder at the boldness of the brash young challenger.
Duesmann understands that Tesla has a huge lead in the software department. “As far as networking and on-board networking is concerned,” he said recently, “we are not on a level playing field yet. [with Tesla]. Software and connectivity are at the heart of Artemis’ mission, and the VW Group has created a new unit called car.Software.org.
“At the beginning, neither of us took Tesla seriously,” says Duesmann. “Then we were puzzled, and then we were shocked at what they were capable of.”
German automakers (among others) must be shocked and they must be busy. They have about a year before Tesla starts shipping vehicles from Berlin.
Written By: Charles Morris; Source: The mirror