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Will Germany’s Car Industry Survive?

Not long ago, Germany's car industry was a driving force of innovation. Today, it’s struggling to keep up. Its hesitant embrace of electric vehicles could prove an existential mistake. Because around the world, the market for e-cars has picked up speed.

28 min
28 min
Video verfügbar bis 01.09.2023

Nowhere is the penetration of electric vehicles as deep as in Norway. Electric or hybrid models already account for 65 percent of all new cars sold there. By contrast, that figure is just seven percent in Germany. Norway has seized the moment, leading the way in new technologies and a charging infrastructure for electric vehicles. Electric cars are cheaper in Norway because they are exempt from taxes on cars powered by fossil fuels. They’re more comfortable navigating through traffic because drivers can use bus lanes. And with an abundance of publicly accessible charging stations, they’re also practical. China’s gigantic car market is also going electric. By 2025, Beijing wants about 20 percent of cars sold annually to be plug-in hybrids or battery-powered.

It’s the dawn of a new era in the auto industry. Why isn’t Germany doing more to keep up with the competition? Former Opel CEO Karl-Thomas Neumann has this explanation: When you have a recipe for success, it’s hard to throw it away and start from scratch. “What’s needed is a new mindset. Jobs will be lost, but new ones will be created,” he says. Analysts lay a portion of the blame on successive governments in Berlin, which have coddled the industry and resisted change. And they accuse current leaders of failing to present ideas on how to tackle an impending crisis. Thousands of jobs are at stake.

Uwe Cantner chairs a government advisory panel on research and innovation. “Trying to preserve jobs at all costs, in areas where world markets are dictating developments, is the worst mistake you can possibly make,” he warns. The markets have made up their mind. The world is ready for a new era of automotive technology. Will German carmakers step up to the plate?

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