"Former VW Boss Diess Voices Vindication Over Caution Regarding Battery Production Investment Amidst Current Industry Struggles"
Fresh Take on German Automakers' Struggle for Global Dominance
In an candid piece for "WirtschaftsWoche," the former CEO of Volkswagen, Herbert Diess, highlighted the challenges encountered by German automakers, particularly VW, in maintaining their global footing as both Germany and China vie for leadership in the automotive industry.
Diess underscores the fierce competition between the two nations, with the Chinese market surging in electric vehicle and plug-in hybrid sales due to technological advancements. Germany, in response, seems stunted by expensive technology and slow development speeds, while Chinese manufacturers struggle to meet their export expectations.
The former VW CEO points out that the cutthroat competition and potential excess capacity in China could restrict the long-term profitability of the auto market. Yet, he emphasizes the importance of maintaining a presence in the Chinese market for global competitiveness.
Diess also discusses battery development, praising Chinese manufacturers like BYD and CATL for their swift progress in iron phosphate batteries. He suggests that European and Korean manufacturers are currently being driven by Chinese battery suppliers, using cost-effective technology that doesn't rely on expensive raw materials like cobalt or nickel.
In addition to boosting Chinese battery production in Europe, Diess advocates for investments in battery production infrastructure domestically. He states that those who were reluctant to invest in European battery production may have acted prudently, but the rapid technological development in China necessitates immediate action.
Diess laments Germany's missed opportunity to create a home market for electric vehicles due to indecisiveness. He served as the head of the large automaker at one point and, in his commentary, encourages efforts to attract more production capacity from Chinese manufacturers to Europe.
Sustainability plays a significant role in Diess's vision for the future. He advocates for recycling facilities within Europe's battery production centers to reduce raw material dependency and promote sustainable practices. Furthermore, Diess champions the conversion of traditional plants, like Wolfsburg, into modern electric vehicle production centers, marking a shift towards next-generation EVs in the European production footprint.
To foster continued growth, Diess also endorses leveraging vehicle-to-grid (V2G) technology within Europe, in conjunction with regulatory frameworks that incentivize usage and promote EV adoption. This approach, he believes, will secure a competitive and sustainable EV supply chain within the continent.
- "What can German automakers do to stay competitive in the rapidly advancing electric vehicle market dominated by China?", technology plays a crucial role.
- The Chinese market has surged in electric vehicle sales due to advancements in technology, and Diess emphasizes the need for investments in battery production infrastructure domestically, leveraging cost-effective technology from Chinese manufacturers like BYD and CATL.
