German Automakers Now Fear Tesla
The German auto industry has poked fun at Tesla and CEO Elon Musk in the past, and has never publicly voiced any concerns about the California start-up. As recently as last November, Edzard Reuter, former Daimler chairman, called Musk a “pretender” and said:
Tesla is “a joke that can’t be taken seriously compared to the great car companies of Germany.”
It was never expected that the small company, especially while losing capital, could ever push the boundaries enough to make experienced German automakers sweat.
Fast-forward to March when 325,000 eager fans around the world put $1,000 each down in one week to reserve the upcoming Tesla Model 3 and times have changed (with the most recently tally totaling about ~400,000 reservations).
Ferdinand Dudenhoeffer, a German car industry analyst at the Center for Automotive Research at the University of Duisburg-Essen confirmed:
“The German carmakers are taking Tesla more seriously every day now.
Germans have an enormous amount of pride in their engineering skills and believe they know everything that needs to be known about cars.
They used to think there was no way that anyone could possibly build cars as well as they do. And then along comes this young punk in California. They thought he didn’t have a clue about cars and treated him like a joke. And now they’re seeing that he’s leading the revolution.”
Many German automakers are already making electric cars, but of those, most are PHEVs. Hybrids have been the “thing” for the trusted companies, and plug-in hybrids seem to be an extension of that thinking. Tesla is proving that all-electric may be the way to go.
There are a few German all-electric models, like the BMW i3, but despite being priced lower than Tesla’s flagship Model S, a disappointingly short range has made sales marginal. This is pushing German companies to quickly get electric models to market. Tesla sold more electric cars last year in Germany than any other company.
After Daimler was victim to many complaints at a recent shareholders meeting, Dieter Zesche, Daimler chairman, pointed out that Tesla has yet to make any money. He said that his company will be delivering a competing vehicle with a range of around 310 miles soon-ish. He is confident that Tesla’s success can help others. He said:
“Tesla has promised a lot but has also delivered most of it.” There is a lot of excitement in the industry about the “overall appearance and approach Tesla is taking.”
“There is no doubt that getting new momentum from a new player is good.”
Claudia Kemfert, head of energy, transport and environment at the German Institute for Economic Research in Berlin, called German automakers careless. She explained that auto companies were “arrogant” and failed to see the competition of Tesla as other German companies have in the past with market-changing innovations like the MP3 player and the fax machine. Kemfert concluded:
“German carmakers have completely misjudged the gigantic economic opportunities of sustainable mobility. The German car industry is in the process of squandering the chances for the future just like the big utilities blew their chances with renewable energy. Tesla is at the same time both a danger for German manufacturers, but it’s also a wake-up call.”
Source: LA Times