VW CEO Warns Against Possible Auto Industry Crash Due To EVs

OCT 11 2018 BY STEVEN LOVEDAY 225

We really can’t say we’re surprised by this.

It seems each day the Volkswagen story changes. The automaker has been advertising its dive into electric vehicles for years and still has little to show for it. The Dieselgate scandal shed additional light on the automaker’s efforts, as well as the speed at which it was going to push forth with its huge EV offensive. One announcement after another, yet not much has come to fruition. Not to mention plan changes, delays, and sporadic negativity toward electric vehicles.

If you follow the segment, you’re likely aware that Europe is aiming to reduce carbon emissions and promote EV adoption by initiating stricter laws. The Parliament was aiming for a 40-percent emissions reduction, while the German auto industry was pushing for 30 percent. Now, the goal has been set at a 35-percent reduction by 2030.

It’s no surprise that German automakers will do whatever they can to push the goal in their favor and extend the deadline as long as possible. Building electric cars is not easy and will cost them more money.

While Volkswagen has been releasing constant news about how it’s on board with electric vehicles and the automotive group aims to have millions of electric cars on the road by 2025, its CEO Herbert Diess seems to be leading the efforts against the potential emission reduction requirements. In addition, he’s going so far as to try to convince us that the entire automotive industry could crash and 100,000 jobs may be lost. Diess said (Süddeutsche Zeitung via Electrek):

The transformation in speed and impact is difficult to manage.[…] Such an industry can crash faster than many believe.

Source: Electrek

Categories: Volkswagen

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225 Comments on "VW CEO Warns Against Possible Auto Industry Crash Due To EVs"

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Get Real

THE SKY IS FALLING!!!

Viking79

You say that, but most of the Tesla fans have been saying traditional makers will go bankrupt. This is exactly what VW is saying now. It is going to upset the industry and he is confirming that. This is what people wanted, I thought…

It is hard for those companies invested in so many ICEs as they do still have to support those (and they have all their investors telling them to support those) and to develop new cars stretches budgets as much as it does for Tesla, especially when their investors tell them to invest in ICE.

Gasbag

“is hard for those companies invested in so many ICEs as they do still have to support thos”

BS. You simply make the move to serial hybrids with multiple bays for batteries. At present (while batteries are expensive) you only populate the bays with enough battery to give it an AER of 50 real world km. Actually to meet current regs you can just put in 1-2kw of battery and leave the expansion bays empty until the customer opts to upgrade or regulations require that.

It has been several decades since I bought a computer that wasn’t upgradeable.

Viking79

And how much does this cost? How well do most Tesla fans like that type of car? Why does someone buying an ICE want a serial hybrid that might lack performance or cost more relative to cheap ICE?

Gasbag
The cost delta is minimal. The engine itself that is your range e tender can be smaller (less expensive) and no need for a transmission. Nissan did most of this with their ePower Note in Japan and it instantly became the best selling car in Japan. The cost of adding empty bays and accommodations for installing a charger are minimal. The biggest drawback would be unutilized space but to answer your question more directly the ePower Note serial hybrid costs about 2 K more than the less popular ICE version. The Hyundai Ioniq is a better example of building a flexible platform that can accommodate any combination of drive train but they haven’t made a serial hybrid variant available yet. The price delta between variants is in the cost of the components not the platform. I believe the reason the serial hybrid is indisputably the most popular car in Japan is the peppy superior performance at that price level. Performance at lower price levels is where ICE sucks. To get an idea of the delta test drive a Chevy Spark in ICE and EV variants and you’ll see why people will gladly pay the two K delta.
DonC

I think a PHEV or any hybrid for that matter is the most expensive option. Has to be because it has the most parts. Electric vehicles should be the cheapest because they have the fewest parts. And ICE vehicles are somewhere in the middle. However there are economies of scale. Since electrics sell in such small numbers electric vehicles aren’t currently that cheap to build.

independence01776

Well said. It’s a numbers game, with scale and competition, prices will soon be cheaper for EV’s. I suggest by 2022, much faster than most believe.

Jerry

So true. VW needs to understand they either change or get left behind and bankrupt along with others that stick to ICEs.

Prad Bitt

The longer they will build ICEs (hybrids included) the longer it will take them to retool their manufacturing facilities and take the electric turn and begin to compete at last.

I WILL NEVER BUY ANOTHER GAS CAR.
These inefficient, stinking, expensive, fragile, vibrating, noisy, poisoning, cumbersome, complex contraptions are from another century, they are killing the biosystems and the faster we get rid of them the more chances we have to survive as a species.

johnny mars

The sooner Big Oil dies, the sooner the War OF Terror for Oil, Poppy, and the Defense of Israel ends.

Viking79

You see where I am going with this? Tesla is going to beat them on costs for at least a generation, they will spend billions developing cars they can’t sell (they will have to sell them for a loss or less profit than ICE). What they need to do is buy EV startups or start new companies that can compete on Tesla’s terms.

garrity

What’s to keep VW or any other major car company from investing in Tesla at some point? If it does become crystal clear to everyone that EV’s are better why not jump unto the big band wagon of Tesla? Tesla doesn’t have the cash to build multiple factories to meet demand everywhere. Is a Nummi like collaboration possible?

Qrk

Nothing is preventing VW or any other legacy car company from investing in EVs or even buying shares in Tesla. The problem is that doing all of this investment might not be enough to save them. All current automakers have huge legacy costs building ICE cars, and it is very possible that they do everything right and still lose.

Take Kodak for example. Kodak was once one of the greatest, most innovative companies in the world. Kodak not only invented the digital camera and invested heavily into getting away from the film industry they knew was in decline, they also had a great brand and a presence almost everywhere in the world. That wasn’t enough to save them from the onslaught of low cost digital cameras from newer, leaner companies.

islandboy

Cameras had little to do with Kodak’s failure. For the full 100 on the Kodak failure see a story titled “How Kodak Failed” in Forbes. Kodak failed to anticipate the real impact of digital photography was that people would stop using paper photographs altogether and that the web would become the main platform for sharing and viewing pictures taken with digital cameras. The lion’s share of Kodak revenues came from film, film processing equipment, chemicals and paper. Apparently Kodak management saw digital photography as a way to expand their photo processing business. Big mistake! In hindsight they could have focused on developing or acquiring photo sharing sites like Instagram or before it Flickr.

pjwood1

They can’t afford Tesla. I’m not saying that because Tesla is so great, but because its price multiple is so extreme and there would be very little contribution to what VWGs board lives for: profits. IOW, the ROE invested sucks.

The math to make VWG aim for Tesla, is measured in avoiding what everyone here is saying. If the horse hasn’t left the barn, the remaining auto players could successfully (in my view) go back to slow-walking market progress. Without Tesla, substantial momentum would be lost in support of regulations. There wouldn’t be a “they did it” example, or a car you can actually buy. That’s when regs get rolled back on faith the ICE chorus sings truth.

Dan F.

I think you are right; at its current valuation Tesla is not really a takeover target. It will be interesting to see at what valuation they can raise new equity capital if they go that route.

Currently EVs offer less utility (mainly range/charging issues) for more money (especially without tax credits/rebates) than comparable conventional or hybrid cars. For large scale adoption they will have to be priced competitively in a post tax credit world. It will be tough to make any money (or not lose money) on mass market EVs. When Tesla becomes profitable it will be by selling premium vehicles. Even $37 – $38k (model 3 with delivery and a paint color) is hardly mass market.

MoMac

The poster who originally asked about VW investing in Tesla wasn’t talking about a buyout, only investing in Tesla.

Though I agree that Tesla’s is too overpriced for VW to want to try to buy Tesla out.

Stan1

“Currently EVs offer less utility (mainly range/charging issues) for more money (especially without tax credits/rebates) than comparable conventional or hybrid cars.”

This is an objectively false statement. EVs currently sell at price parity to ICE products in a number of market segments. Demand for those EVs completely outstrips supply because those EVs are massively superior to their ICE-based competition due primarily to the higher utility of their EV drivetrains.

Andy

Well, no, if its objectively correct if he’s talking about the whole market – which he appear to be. Being at price parity in a number of relatively niche markets is not the same. For most people an EV is objectively more expensive than an ICE.

DonC

Agree the price would be too high. It’s always a question of whether it’s cheaper to buy it or build it. Even with Tesla’s beaten down stock price its market cap is $43B. For that amount it’s a lot cheaper to build.

But autonomy more or less guarantees an electric future. That march will be controlled by Waymo and no amount of foot dragging by existing manufacturers will slow it. Too many people on board (though it would have been great if Congress had OK’d vehicles without seats and steering wheels).

BroncoBet

Tesla is already priced for perfection,VW is worth far more in future cash flows.

MoMac

“What’s to keep VW or any other major car company from investing in Tesla? ”

Three simple words — Tesla’s market cap.

Independence01776

I think it’s more likely Waymo, maybe Apple. They have the capital and they can’t get into automaking on their own at this point, but they have great desire to enter into self driving vehicles and all that entails with delivery of goods, services. etc. Tesla also would see them as a better fit than traditional auto company.

BroncoBet

Waymo uses FCA but also Lexus they can be used with any platform,Cruze obviously uses the Bolt,I believe Apple has it’s own vehicle but they offer Apple Play on many models.Unlikely anyone would do a deal with Tesla,besides ,they are selling lots of 3’s now.

Miggy
Pushmi-Pullyu

Unless you’re trying to argue that Tesla is going to take over the entire automotive industry, you really don’t have an argument. It’s not that your argument is merely wrong, it’s that it has no foundation at all. You haven’t made a single valid point.

Volkswagen isn’t worried about the entire automotive industry “crashing”. It’s just worried about its own ability to make the transition which the EV revolution represents, and it’s hoping that if it whines loudly enough, the German government will extend a helping hand.

MoMac

It was specifically worried about the 40% improvement in emissions by 2030. VW CEO called a tightening of the climate targets by a maximum of 30 percent (by 2030) as justifiable (according to Electrek article).

According to link below.

https://www.sueddeutsche.de/wirtschaft/vw-stellenabbau-co-grenzwerte-1.4164002

Windbourne

No, if those companies had any sense about them, they would :
1) fire top management and hire only engineers.
2) quit buying batteries from Asia. Instead, build 100% of their own factories.
3) quit getting their elements, such as Cobalt and Lithium, from Asia. Get it from Australia, and start looking around for local sources.
4) develop the RARE EARTH in Europe.

Then they would survive this.

Independence01776

Some companies are starting this direction. MBenz just announced the CEO position will be given to it’s tech VP.

Richard

Tesla cannot possibly scale vehicle production enough to supply the market. But Tesla is very good at scaling battery production. Tesla will provide battery factories at a cheap price to VW and other companies so they can do what they do best which is assembling cars and then designing huge advertising campaigns.

Andy

Which is great in theory but that would just put the price of all cars up by several thousand (potentially $10,000+ in some cases), not to mention requiring the complete reworking of all models they produce in such a short time frame.

Pushmi-Pullyu

How does that saying go? “Lack of planning on your part, does not constitute an emergency on my part.”

If legacy auto makers failed to plan ahead for the reality of the EV revolution, then they have no one but themselves to blame. It’s not like they couldn’t see it coming years ahead of time.

Change is hard. Life isn’t fair. Welcome to the real world, Volkswagen.

jeffhre

It’s not like they couldn’t see it coming – years ahead of time.

Dr. Strange

Read “The Innovator’s Dilemma” — https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma. Even if legacy vendors see it coming years ahead of time, sometimes it’s just impossible to escape from your past.

Andy

If all the established car manufacturers didn’t see it coming then it’s not as much of an issue. If almost all car manufacturers (by volume) are “behind” then they’re basically at the same starting point. Companies like Tesla really aren’t much of a threat outside of a few niches (i.e. companies like BMW) and won’t be for another decade or more (if Tesla are lucky).

VW seem to be better placed than most to make that transition.

David Cary

If Tesla grows sales as much as it has in the last 3 years as a percentage, there isn’t much room for anyone else in a decade. The last 3 years has seen an 8 fold increase in sales. Another 3 would be 640,000 in a quarter. 3 more years 5 million. Last 3 would be 40 million per quarter. Ok – so that is only 160 million sales per year. But they would be the top 160 million cars based on cost so that wouldn’t leave many remaining manufacturers.

Do I think that would happen – no. But that would be the current trend line.

And is there not other EV auto manufacturers. Like BYD?

leafowner

Globally, only about 90 million cars are made per year.

David Wolff

It’s 80 million…and thats ALL FORMS, Trucks SUV, semi….

cfox

Geometric progression is only sustainable for so long. There’s only so much metal in the planet.

Andy
Which is why following a simple trend line is a fools errand, especially in a capital intensive market, without realising where on the graph you are when taking the tangent. To get to their 640,000 cars number they would need to build another factory within 3 years from now – certainly possible, the China one may well do that, especially with their current factories fully operational. But then it all goes wrong. To get to their 5 million in 6 years from now, that’s around 9 more factories (to put it another way, $18-45 Billion in capital) – they’re only planning on two in the next 5 years (publicly at least, with full production probably not even set in one of those (the European one) in that time frame). Then 40 million in 9 years? That’s 80 factories, that’s 9 factories every year for the next 9 years ($160-400 Billion of capital)… The realistic number of Teslas being built in 9 years? Probably close to 1.5-2 million. Full production from their US, Chinese and European factories (in that order) and perhaps another one, maybe two, built in the latter half of that period. In a market of 80 million cars,… Read more »
wavelet

“It has been several decades since I bought a computer that wasn’t upgradeable.” Really? Virtually no brand-name computers are upgradable nowadays. Certainly almost no laptops. More and more components are soldered rather than socketed.
Yes, you can still do it if you build your own computer completely (I recently did this for a home NAS/server), for desktop or rack systems.
A 1-2kWh battery is worthless, and batteries can’t be added flexibly since they affect not just range but charging abilities, cooling systems and power delivery. This isn’t Lego.

Windbourne

actually, more and more components are ‘socketed’ because more are moved into chips.
there are actually far less soldiered elements on a MB these days than in the 70s/80s.

Gasbag

Yes, I haven’t purchased a computer (excluding embedded systems) which was not upgradeable.

A 1-2 kWh battery is not worthless in a serial hybrid. It is essential. The ePower Note uses a 1.5 KWH battery. At that capacity you would not need to add a plug. That would be added when the battery capacity is added.

It absolutely can be LEGO like allowing flexibility to meet customer price points. Most of my devices which use batteries use a standard battery form factor with predefined characteristics.

D M

Obviously you are no engineer… Just adding things changes nearly everything electrically – larger wire sizes, full sized inverters, motors etc. Which, if you’re trying to save money accomplishes nothing. Batteries are just a portion of the cost of an EV. You’ve been playing with too many Legos. Engineers rule this game.

LH

Wire size, inverters,motors etc. really have nothing to do with the battery size.
The battery management is inside the battery pack. The rest is software. So, yes, they can be upgradable.

John Doe

Just stay away from Apple, and you can change most parts. Usually stuff like RAM and HDD/SSD is easy to upgrade. The other parts can be replaced, but often not upgraded in laptops.
Will normally be time to buy a new one, with another motherboard that supports better processors, faster memory and the latest in WiFi and modem technology – but on a stationary PC, upgrade is usually super easy with standard components. I upgrade HP PCs all the time.
Personally I tend to build my own stationary PCs.

Terawatt

If you had not been upgrading your computer since 1990, you would have bought one that isn’t upgradeable. :p

Maybe not, but the fact that you haven’t doesn’t mean computers generally are very upgradable, much less that a lot of people actually do upgrade them.

I agree though that it isn’t hard to meet the current regulations. What is hard is to predict when EVs will become profitable, who will come out on top after the shift, and how the regulatory environment will develop. Although the EU decided on a 35% CO2 reduction target by 2030 it is far from sure that won’t change before 2030. So far the IPCC reports have only gotten more depressing with each iteration, in part because we learn the situation is even more difficult than was thought, but mostly because we have less time left and haven’t achieved a thing…

Vexar

And they called us arrogant for suspecting this. Wow, such a short time-line for this industrial disruption!!

Mil

It always is, there’s a physiological phenomenon for those who are in the industry of being disrupted. They are so blind for the massive train that is going to plough into them. That’s why huge giants like Kodak, and landline telephone companies fell. They just failed to pivot in time still clutching on to their archaic ways.

Andy

Nope, Kodak knew exactly what was coming, they just misjudged it. That’s the difficulty with large established companies, when do you jump in and what do you jump in with? Do it wrong or too early and you end up like Kodak, do it too late and you end up bankrupt too.

Gasbag

“companies, when do you jump in and what do you jump in with? ”

That is the beauty of moving immediately to a flexible platform as described. You don’t need to know what tech will prevail, when it will prevail, or it’s exact form. If batteries have a dramatic and sudden advancement then the Bay for the ICE REX becomes a frunk. If HFCs have a dramatic advancement then the ICE REX is replaced by FC REX.

Joe Martin

As Upton Sinclair said, “It is difficult to get a man to understand something, when his salary depends upon his not understanding it!”

pjwood1

You’re heavily invested in film, when digital arrives. I get the parallel, but VW is arguably in a worse position. Kodak was publicly traded, with few family members and no union on its board of directors. The family members of VW (coming upon 4th generation) may be more in it for profits, but the company’s culture still hews towards a race-ethic. It’s this extra hang-up, that harmonizes with bean-counter resistance to batteries. Can we say film was religion, to Kodak?

Andy

VW is a car company – transitioning to EV still makes them a car company.

Kodak made most of their money on film, which means in this analogy it was essentially an Oil company that made some cars trying to transition into a company that solely made cars.

Gasbag

The hardest part about this is getting a company founded on ICE design to emotionally accept that the end of ICE’s reign is nigh. All electric drive trains are evidently the future.

Viking79

Publicly they deny it, but I think some are starting to accept that reality internally. Battery prices dropped quicker than anticipated making PHEVs less relevant. I think this is more important to luxury makers this car generation, but it will migrate down.

pjwood1

Agree. A whole purgatory of PHEV and mild-Hybrid look to be leapfrogged, first by small makers who want market share and can procure battery volumes. I read this epitaph(?), on 48V, and found it interesting:
https://tinyurl.com/yawl7vbb

What’s different, for VW, is they still see the auto-world through a lens of “as few as possible” platforms and are only now starting to see the disruption of a binary (EV & ICE) outcome. They aren’t alone, as legacy “tweakers” of ICE, who thought the incremental thing was going to work out. Where they differ, is how massive they are, and what sourcing is implied to produce even a fraction of current production as all-EV (or BEV).

silversod

Also the WLTP emission limit for PHEV’s/hybrids has been cut from 90g/km to 50g/km, From what I’ve read the only one that makes the limit at present is the Mitsubishi overlander PHEV..

Pushmi-Pullyu

I think you mean the Mitsubishi Outlander PHEV?

silversod

D’oh! My Bad. Thank you for the correction.

jeffhre

I myself cannot accept that – it just seems to be happening so incredibly fast. In fact the whole thing makes me want to fire up roll out the Model 3 and just go for a drive to clear my head and contemplate the larger implications…

Pushmi-Pullyu

“You say that, but most of the Tesla fans have been saying traditional makers will go bankrupt. This is exactly what VW is saying now.”

Oh, what cabbage. Yes, some of the legacy auto makers will fail to make the transition to making EVs instead of gasmobiles. That’s entirely predictable, because it happens in every disruptive tech revolution.

But the reason why some fail is because they fail to remain competitive with others in the industry which do a better job of making the transition!

This idea that “the entire automotive industry could crash” is beyond absurd. The only way that could happen is if people stop buying cars altogether.

If whining was an Olympic sport, Volkswagen would get the gold medal. 🙄

martin

“the entire ICE automotive industry could crash”

Speculawyer

“most of the Tesla fans have been saying traditional makers will go bankrupt”

BS

Windbourne

‘Wanted’? No.
Foresaw? Yes.

And no, investors in western car makers have been telling the car makers for YEARS to deal with EVs, as in START MOVING THERE. They have chosen to NOT deal with it.

I will say that part of me hopes that GM and Ford bankrupt again. If so, hopefully, this time we will do things RIGHT.
Rather than let them totally fail, simply break them up. Seriously, if we break them up into multiple companies and put none-MBA engineers in charge, we will see a lot more Tesla and original fords.

MoMac

IC Engines have a typical product lifecycle of about 15 years. By that, I mean how long before a company stops producing an engine.

The reason for this is they have to keep improving engines to keep up with emission standards and MPG (or km per liter). There are some engines that have a much longer product model life cycle, especially those for large trucks.

VW CEO was saying a high percentage reduction (like 40%) would cause layoffs,
he wasn’t saying that Tesla would cause layoffs at VW.

Independence01776

I’m one of those people who’s been saying for 3 years or so that EV’s represent a serious risk to traditional automakers. Want them to fail is incorrect. But I do want EV’s to succeed because they are better for consumers and better for the environment. They will soon be cheaper, they are easier and less costly to maintain, they are safer. So if an existing ICE manufacturer were to lead the move to EV’s i’d be tooting their horn. The reality of business history shows that such change comes from outside the traditional leaders and they either decide to catch up, or will many times go out of business. There is no glory in watching a company go out of business. I certainly will take zero pleasure in it. But I’ll probably brag a bit saying I was right.

Many smarter people than I have been saying the same thing. I didn’t invent this idea of disruption to the auto industry , which is just starting to be noticed by a broader audience

Prad Bitt

Most Tesla fans are electric cars fans (but there is no sensible choice) and they want the industry to build electric clean cars, not go bankrupt. I have zero pity for corporate cheaters and liars trying to suck even more tax payer’s money to have them make electric cars.

TM3x2 Chris

Sounds like fishing for excuses to delay production and delivery of BEVs in 2020. I expect a lot more similar interviews and press releases from VW. Their message is “why change things, we can make more money the old way”.

jelloslug

For VW, the future is always “just around the corner”

Joe J

They figured they had more time, and now they’re realizing that without starting earlier, they’re in for a good deal of hurt. Companies can’t make huge transitions like that overnight, and it’s their own fault for not doing what they said they would do back in 2013.

After witnessing Dieselgate, I have no remorse for them. They didn’t just screw up, they intentionally cheated. If they can’t adapt and do what they say they’re going to do, then “drastic” measures such as the 35% emissions regulation should be enforced. They were given an opportunity but squandered it, and never followed through with their initial promises of being the EV leader. A business that can’t adapt to changing times doesn’t survive. It’s capitalism 101.

John-EU

They cheated yes. But their behaviour afterwards for me is much more of a problem. The kept denying it for a long time, and when there was no escape anymore, they had to admit. End then it got even worse: they kept on cheating, even with their Porsches and Audi’s. How stupid and stubborn can you be? That alone cost them 5 years of EV development. And now you start to cry like a all boy in a big kindergarten. No mercy, sorry!

John Doe

Almost all brands cheated.
Trying to save some money in a very competitive business.
Let’s see how much money Tesla makes in the next 5 years. They have to work really hard to be competetive. Auto makers are trying to save money everywhere, and the next 5 years will be utterly fantastic- when EVs actually have to compete with each other, and fight for the customers.
I think this will result in better deals, more choises and more inventions.
By then model 3 will be in version nr 2, and we can see what they learned by the first generation, and what they will change.

Pushmi-Pullyu

Thank you! You have expressed my own thoughts and feelings, probably better than I ever could have.

If VW had followed through on all those previous promises, or even some of them, about becoming the industry leader in making EVs, or had even put into production some of their endless parade of vaporware EVs, then they wouldn’t be in the position of suddenly having to make a massive change to most of their lineup all at once.

No sympathy here.

theflew

He’s not wrong. People will lose jobs. It’s a known fact building EV’s is less resource intensive. Building electric motors is a lot more automated than building an ICE. Transmissions in EV’s are dead simply. Outside of Tesla with their rather complex pack assembly most EV’s have a few hundred cells in their pack.

REXisKing

So, Jimmy Chanos shorting WRONG company. Check.

Will

The transition will hard felt. The Rust Belt will definitely be dead 💀. Country will hate EV and vote GOP until ICE jobs are back

amt

The Transition Will Be Tough at First . However , As Other Jobs Are Created The Bumps Will Get Smoothed Out And In the Future, There Will Be ZER0 Regrets !

Will

What jobs if they getting automated

GuyMan

Perhaps we can power the “older generation” with Coal – Then it’s a two-fer!

Billy Gomes

Alot of people in the horse and buggy business lost their jobs in the early 1900’s…
but like Elon said a few months ago, their is a lack of trained electricians in the US, i’m sure their is a lack all over the world, train now to not be obsolete in 2 years

Innovatin is coming

If I can ignore the fact that these are real people who might lose jobs, progress is inevitable.

Especially so if a sector is weighed down with labor costs that are quickly becoming outsourced to technology, whether that’s automation or a simpler design. The Auto Industry was ripe for disruption, but buy-in to disrupt was huge. Its expensive to start a car company. Tesla got their first. China or some other quickly advancing country would have gotten there eventually too, I think. Sorry VW but writing was on the wall.

DrDauger

In September 2013, VW boldly declared themselves the leader in “electric mobility” by 2018.
5 years later, in September 2018, who is the leader? And now the specter of VW drowning in the EV wave to come?
It’s easy to see why skepticism of VW’s announcements is rampant.
Just look what happened to Winterkorn, a couple years after his quotes in VW’s 2013 press release (next post).

DrDauger
VW’s press release in September 2013, for the Frankfurt Auto Show: Volkswagen launches bold offensive for age of electric mobility Group sets sights on market leadership in electric mobility by 2018 Multi-billion investment in new technologies, 70,000 employees trained Initially choice of 14 electric and hybrid models by 2014 Winterkorn: “We are starting at exactly the right time” Wolfsburg/Frankfurt am Main, 09 September 2013 – The Volkswagen Group has set its sights on global market leadership in electric mobility. “We are starting at exactly the right time. We are electrifying all vehicle classes, and therefore have everything we need to make the Volkswagen Group the top automaker in all respects, including electric mobility, by 2018”, Prof. Dr. Martin Winterkorn, CEO of Volkswagen Aktiengesellschaft, said on the eve of the 65th International Motor Show in Frankfurt am Main. Initially, a total of 14 models from several Group brands will be available with electric or hybrid drive technology by 2014. If there is sufficient demand, up to 40 new models could be fitted with alternative drivetrains. Winterkorn underscored that Volkswagen had placed electric mobility “at the center of the Group”: “We have developed the know-how for electric motors and battery systems at… Read more »
Viking79

My hunch is they changed their plans with Model 3 reveal and response in 2016-03

Dave Martin

Sounds like VW misrepresented their timeline and lied to shareholders. Quick, somebody call the SEC!

Vexar

So there’s 70,000 people trained in what, exactly? They watched a 15-minute animation and pitch as part of a half-hour company stand-up meeting? Or did 70,000 people get a month of training? The latter could be easily $500 million that VW will never spend.

Arbuckle

August 2013; Hey Honey (VW), the transition to EVs is happening, are you doing something about it, so that your employees will still have jobs?

Yes Dear.

October 2018; Hey Honey (VW), the transition to EVs is REALLY happening, did you do something about it, so that your employees will still have jobs?

Yes, I spent a WHOLE day in September 2013 writing up that huge press release.

Andy

What EV wave is that? VW are at the front of the wave compared to the majority of the larger/established manufacturers. without companies like VW the “wave” will just be a ripple building slowly over several decades.

Pushmi-Pullyu

VW has been claiming to be at the front of that wave for several years now. If reality matched their claims, then they wouldn’t now be whining about the approach of that wave; they’d be surfing it!

Timothy Hughbanks

I’m sure that management at Nokia and Blackberry voiced similar sentiments.

Bunny

I’d call it more of an adjustment than a crash. Didn’t Tesla shed 9% of its workforce while being in super growth mode?

There’s alway loss of jobs while even hiring for different segments in large corporations.

I think this is a non story, just Volkswagen, German Auto industry bashing.

Vexar

Tesla bought Solar City, and they have been picking at that for a while. They also trimmed some middle management and “what are you doing, exactly?” contractors. They did not touch production / line workers at all. VW will have to, or retrain them. Probably the former.

Hauer

Read again.

Big277wave

Norway has shown that consumers will switch brands to get a BEV, by delaying the introduction of BEV’s, VW might find they don’t sell any more Diesels, they’ll just see their competitors getting the sales. Once you’ve tried silk, it’s hard to go back to cotton. They might find the competition then retains that customer at their next car change as well!

Will

Norway don’t have an auto industry

Dam

only because of insane tax incentives (around 30% less).EV do not sell in countries without EV incentives

Some Guy

Iceland does not have EV incentives. Marketshare is second highest in the world after Norway. Despite Tesla having neither a presence nor a Supercharger there, some folks even import Tesla’s from other markets on their own.
Just wait until 2019 and you will see how well Tesla vehicles sell in the US with much less incentive than today, and then watch them in 2020, when they will outsell their incentivised competition and ICE while having no access to incentives.
BTW: Have you ever bought an ICE at full MSRP? Because most ICE vehicles are heavily discounted to be sold at all…

Andy

Yes it does, alongside the fact it has cheap electricity and some of the highest petrol prices in the world.

Much like Norway EV’s are exempt from import duties and VAT, so it seems their car market is very similar to Norway.

https://www.theicct.org/blog/staff/iceland-ev-market-201807

Some Guy

I stand partially corrected. However, waived import duties are usually an invite for legacy ice manufacturers to hike the price of their compliance EVs and pocket 90% of the difference. Like they are selling EV buses in Europe that are on par with Diesel in TCO after massive subsidies, while similar buses cost a third in China (without subsidies).

Andy

Yet they aren’t in Norway or Iceland.

Regarding the buses, where are they made? Are they exactly the same buses (or do they have different safety features, for example)? What does it cost to import them into the country from China?

There’s likely to be a lot more reasons than just inflated profits, especially as we’re getting to a point where there are multiple companies to choose from, which means competition.

Bjørn Vabo

For most of phevs and all bevs in Norway the only tax is 25%vat. The gas guzzlers gets the heavy tax penalty by this model: the less efficiency, the more tax..
why not intoduce this type of tax regime everywhere?
An then use the tax for ev incentives/ tax cuts

Gasbag

“EV do not sell in countries without EV incentivEs”

The ePower Note is the best selling car in Japan and it lacks EV incentives. Likewise the Serena I believe is or was number four in Japan.

Speculawyer

Norway is one of the most wealthy and forward-thinking countries on the planet. They are not exactly representative.

ffbj

Knock me over with a feather. Ya think so, how insightful.
It’s difficult to change a corporate culture which for years acted with impunity, felt they could do, or say whatever they wanted.
They cheated on emissions standards, lied about it, and continue to generally be a force that tries to hold back the changeover to evs.
They have no credibility whatsoever.

amt

Dear VW, STOP THE FUD ! If “Y0U” Can’t Stand The Heat , GET OUT OF THE KITCHEN !

DL

+1.

The companies that produce _wrong_ models will simply go out of business, but their factories will be bought and re-tooled by companies that produce the _right_ models (for the market). And that’s how it should be. That’s the capitalism’s way of re-purposing resources to serve the advances and oust the inefficient vision and management.

i see no drama, only progress.

amt

You Know What They Say., “Only The Strong Survive”

Andy

What is with your constant use of “0” instead of “o”?

Too much 4chan?

Pluto

0h n0ez

Viking79

I can believe an automaker can fall incredibly rapidly (2008). They have enormous debts and depend heavily on revenue from car sales. Imagine taking a 30% salary cut living month to month…. I know in US Mercedes sales the last 3 months have been down 10 to 30%. Keep that up long and they will have to start cutting. Luckily production and deliveries of Model 3 is still limited and that the Model Y is still a ways out…

Taylor Marks

I think people are way overestimating how far away the impact of the Model Y is.

There was an immediate slide in BMW 3-series sales when Tesla revealed the Model 3 and started taking deposits. That slide has only gotten steeper as Tesla entered production and worked their way through the reservations and started taking orders with delivery in 2-4 months.

Tesla is going to reveal the Model Y in 5 months. That’s going to lead to an immediate drop in sales for competitors. I expect the time from reveal to initial production, and then from initial production to 5K/week will be shorter than it was with the Model 3. I think we’re less than 2 years from 1-2K Model Y being sold every month, and not much further than that from hearing about over 1M Model 3 and Model Y each being sold on an annual basis.

If you don’t have a 150+ mile EV today, I think you’re already lowered into your grave and just waiting for the dirt to bury you over the next few years. Only Nissan and GM have any shot at surviving the transition that Tesla is bringing.

William

@Taylor M.

I think you may have forgotten about the Hyundai/Kia brand, in your “shot at surviving the transition” statement. I got a good look at the Kona (test car) at the DC CCS EVgo fast charger here in Los Angeles last week, and the Kona looks like a worthy contender to the Bolt & 2019 Leaf (60kWh), in the 200mi. + range (Hyundai/Kia supply constrained) hatchback segment!

Will

Kona just like the Ioniq is a compliance car

Viking79

I think VW will be fine, they are actually dumping a lot of money into EV development as much as people like to pick on them.

Andy

You do know BMW’s US sales are up this year right? It’s worth putting the decline in BMW sales in 2016 into context – the overall Car/SUV market declined in 2016 and 2017, not just BMW’s – and that their sales were down YOY prior to the Model 3 announcement. So a bit of FUD against BMW there?

And it’s also worth pointing out that it’s going to be 5 years (Tesla’s timeline) before they have theoretical capacity to manufacture up to 1 Million vehicles. That’s 2023. That’s at or around the likely midlife refresh of all the vehicles announced by the German marques, and after BMW’s NEXT release and a lot of the other manufacturers currently announced vehicles.

Loboc

I predict that I’ll have a Model Y in my driveway before VW delivers anything EV in the USA.

Pluto

I love that prediction

DL

Well technically they do deliver EVs in US. maybe just not the EVs anyone would want too much. 🙂

amt

I Predict that you will be Right…

DonC

Theoretically the car companies restructured so 2008/2009 isn’t repeated. On the production and sales front, the restructuring allows them to remain profitable (or lose a lot less) at much lower sales volumes. On the cash front, they have a much larger cash cushion.

Of course FCA, Ford, and GM are vulnerable to slowing sales of trucks and SUVs/CUVs. Those are their highest margin vehicles (do Ford and FCA even make sedans?). However, don’t expect a repeat of 2008/2009. Then gas prices were at relative historic highs, which cut demand for these vehicles. Currently gas prices are low (and going lower as the price of oil drops), and SUVs/CUVs get pretty good MPG. I wouldn’t think a slowing economy would affect trucks and SUVs/CUVs any more than it would affect sedans.

David Gould

Price of oil is rising, not dropping..

Texas Leaf

Nobody, except for maybe Tesla fans, want legacy auto manufacturers to fail, but people need and want zero emission vehicles that run on inexhaustible fuel sources. Transition is always difficult and sometimes very painful. Auto manufacturers that commit to the transition and lead change will come out on top.

William

I always beach, moan, and complain, when Tesla starts to devour my lunch, because I foolishly left it out unattended. Honestly, I didn’t realize, until it’s too late, just how hungry that ravenous Nicola guy was!

I was unaware that the Energizer Bunny was now running, longer and stronger, on less expensive Lithium batteries. The ICE OEM tortoise, may have finally met its match, in the ensuing EV adoption race to Zero Emissions!

amt

Bunnies Can Sure Run fast !

scott

Hey Germany, unless you want your economy to collapse, I suggest encouraging German automakers to embrace electrification.

Mil

@VW: And what? You had your chance, but you got caught cheating. And then you had your chance to turn things around to make it right but you drag your feet and still bang on about how diesel isn’t dead. Sorry, but either get on board or move the f**k out of the way. EV train is coming in full force.

Some Guy

35% reduction in 12 years is a joke. Norway has managed >60% reduction in about 6 years until now.
Funny thing is, the competition building EVs does not care so much about ICE competitors crashing. Maybe the ones from China do, because they want a cheap buy in to get factory sites and skilled assembly workers. Within 12 years, a quarter of the current workforce will retire anyway, and the others can adapt. Besides, someone has to take care of the robots that will assemble the EVs.

Bill Howland

VW management is showing in more and more ways that they just CANNOT TELL THE TRUTH about anything. If VW doesn’t want to be in the future car business, the public will simply purchase ev’s made by other brands. Problem solved.

John-EU

They started the company with a stolen BEETLE design from the Czech republic. 80 years later nothing has changed in their behaviour.

Gary

conversion to electric will be a massive change to the economy. it requires fewer people to assemble, fewer pieces, less maintenance, no transport truck hauling gas and parts around. some of those industries will collapse. I doubt any of that will be overnight.

Another Euro point of view

I hope at least that Tesla is not going to crash otherwise in 100 years people would still have to read conspiracy theories in the comments section of Insideevs. That would be worse than reading the yellow pages.

Pushmi-Pullyu

You don’t “have to read” anything here. Gosh, we would miss you and your fellow serial Tesla bashers so much if you left. We’d cry a bucket full of crocodile tears.

Another Euro point of view

I know, this is why I am staying :-).

Another Euro point of view

Also a reason I need to hang on in there is that soon all hands on deck will be needed to provide psychological support to the unlucky investors here, I already wrote about this earlier as you never fail to remind me.

Nix

VW also wants to remind everyone to watch out for snakes!

If anything, there will be a boost in car sales as the s-curve of EV adoption happens

Jimi seko

Big auto companies used to be run by engineers but that changed a long time ago. Traditional auto companies run by MBAs competing with an auto company run by a rocket scientist is fun to watch.

Another Euro point of view

By doing that VW is just lobbying to safeguard their profits acting in the best interest of their shareholders. A company acting in the best interest of the planet is fine too but shareholders interest usually come on top. You do not like it then there are other types of society but those did not fare too well in the past (soviet Russia etc…).
Now I take it that it does not mean that VW does not want to address the EV market but brutally enforcing a rule without taking demand into consideration is politics acting recklessly in a business world with offer and demand rules. Communist countries did that and it famously triggered huge famines. Biggest 20th century famines were caused by politics interfering with markets.

Deepak

You are right, but these companies had almost a decade to address this but they moved the target to the last minute and now are struggling. They had the advantage of over 5 decades of experience compared to Tesla and yet they cannot manage, that is not good……
You can come with any number of views, but the hard core fact remains that when they had a chance to change, they just sat doing nothing and when the other company started working, they still didn’t do anything, thinking and hoping that Tesla fails and everything comes to their comfortable zone, but now that those chances are slim, they are trying to create the FUD which people cannot accept and are really getting pissed at.
In short, we have one person facing the wrath of the world, just because they don’t want to go another zone, and when he succeeds these companies make up another reason for not moving to the other zone.

Another Euro point of view

I agree that they need to be pushed towards EVs but in an orderly way in a long term view. For example in the years 2000-2010 there were big incentives for solar in many EU countries. Then states realized they could not sustain the incentives they agreed upon earlier and those were often brutally stopped leading to many bankruptcies. It many situations it resulted in the exact opposite effect than the one initially thought about. This is why those measures needs to be negotiated. Everything needs to be negotiated in life, including often with one’s partner/wife/GF.

John-EU

Their most influential shareholder is the German state.

Bjørn Vabo

When i look at Tesla it seems like demand of evs is already through the roof.. VW could Just make Great and profitable 30 k ev’s today by the millions..
If Tesla can do that(or close) , it should be super easy for the big, rich, professional VW.

Another Euro point of view

It sure helps if you sell a dollar note for 80 cents or claim that the car you just sold will benefit from full self driving… within days, within weeks, within months, within years.

pjwood1

It is telling how you view shareholders and the interests of the planet, as being in such opposition. Not a recent discovery, but not lost on a free-market view, either. Do voting participants in a free-market equal communists, “brutally enforcing a rule”?

As a TDI owner, I learned the psychology of a corporate culture that could miraculously separate the person buying their car, from a voter, or from any kind of consciousness with regard to the environment. Does VW still define itself by this fiction? I wouldn’t go near equating democracy with communism, but mine isn’t another industry point of view.

Mark.ca

LOL…” acting in the best interest of their shareholders”?
Yes, that’s what i want! To be invested in a company that chases today’s profits and sits on their butt while the future passes by. Good luck with that!

William

That “future passes by”, can be defined or considered in the standard Wall Street terminology as a “Value Trap”.

https://www.investopedia.com/terms/v/valuetrap.asp

Shareholders should know better, than to take the V.T bait.

Deepak

I thought Tesla was going bankrupt (as per Bob Lutz) as they do not have any
* Technical Advantage
* Battery Advantage
* No Manufacturing experience
* No Cash as they are burning out cash like crazy
as other car companies will quickly manufacture electric cars and put it in market even if they have to lose money.

Wondering if he changed the company name to Tesla by mistake when he was mentioning all along ICE manufacturers.

Man what do Tesla fans know. They are just fans with no knowledge of how businesses operate in the world and have to be educated by people like Bob Lutz

DonC

The industry crashing and Tesla going bankrupt are not mutually exclusive. In fact to the extent Tesla is part of the industry the industry crashing makes it more likely Tesla goes bankrupt.

On the financial front, Tesla will have to come up with $3.1B in the next six months and it has $2.2B of cash on hand. To stay solvent it will have to come up with a way to raise cash. Now there are ways to do this. In the past Tesla has issued more stock. That did not seem so easy even last week before the current sell off. May be much harder going forward. It has also issued bonds, but the bond market isn’t going to be hospitable. So that’s the problem.

G2

DonC reveals he is a shorter…and no one is shocked….

earl colby pottinger

Just like he said last year, and the year before that, and even the year before that one.

He clearly knows what he is talking about – NOT.

Bjørn Vabo

And thats one of the biggest reason for me to buy a Tesla: Its the only company i know that makes ther ev’s with passion and love.

TJKR

It’s inevitable that electrification and the next global recession will cause several of the big Auto brands to die. My guess in the US will be Fiat Chrysler and maybe a big chunk of GM. In Japan, it’ll probably kill Mitsubishi, Suzuki and one of big three, Toyota, Honda, Nissan. My guess is Nissan. It’ll pretty much destroy European auto unless they electrify.

Deepak

Companies need to adapt constantly for changing environments and the ones that don’t do it, will go bankrupt

DonC

Electrification per se in not disruptive. Autonomy is. Recessions tend to kill off the weakest, especially those in the weakest financial situation. Which car company best fits that bill? Personally I think the majors are well suited for a recession as long as it’s not accompanied by high gas prices which would kill sales of pickups. That would be particularly devastating for FC and Ford.

ffbj

Sure, stick your finger in a light socket and tell me evs are not disruptive. Right, like, it sounds just like what legacy auto has been saying for years. How they can just switch over at the drop of a hat without so much as a how do you do.
You must not have gotten the memo that legacy auto is now very worried, and the line of drivel you are preaching has been discontinued.
If people are demanding evs and you don’t have any batteries that sounds fairly disruptive.

DonC

I get the distinct impression that drivel is one of your areas of expertise. Anyway, why is electrification per se disruptive? It’s just a different powertrain. In the longer term it will require fewer parts, which means the manufacturers and their supply chains will shrink since fewer people will be able to turn out more product and you’ll need fewer suppliers. But cutting head count happens all the time in industries. Over an extended period it’s painful but not deadly. Plus in the short run electrification won’t make a significant dent in the sales of ICE vehicles.

The big disruption comes when you add autonomy and ride sharing to electrification. That fundamentally changes everything. All the money is now in the service of providing transportation rather than vehicles. At that point the value is in the software and the ride experience not in manufacturing expertise or distribution. Plus you need far fewer vehicles.

What’s funny here is I think the auto industry is in more danger than you do. The majors can handle electrification. The move to transportation as a service not so much.

Cypress

That’s why GM seems so focused on autonomy and transportation as a service. They said they expect to be able to make 40X profit on a car used in a ridesharing vs a car sold to an individual.

Will

EVs are not disruptive

Will

Where’s the demand besides the model 3 artificial demand

Andy

Generally recessions don’t come with high oil prices, although high oil prices can help contribute to recessions. Unless there’s something global going on (like a major war in the Middle East) or it’s a localised recession in a single country, oil prices will drop as demand for it drops (i.e. recession). It normally takes a few months before it does though, as there is a lag.

William

In the 0il patch, they refer to that “demand drop”, as “inventory build”, which leads to, over time, the distinct probability of lower prices.

This is especially true when M.E. OPEC monarchies are not distracted, or by association, involved in neighborhood proxy wars.

William

Ford is already circling the drain, check their latest dividend reduction for current shareholders. Also notice where the stock is trading below Fords 200 day moving average. Ford will have some big news coming early 2019, and it better be real change, or else!

Will

Big change from ford is that there bankrupt

Will

Ford will be done for sure

Will

Ford will die first. When SUVs is all you sell and people wallet is tight

Will

None of the Japan autos going poof. Toyota is number 1 in sales. Honda is more a motor company and Nissan is on thier way with its ev program

Speculawyer

I think what a lot of people are worried about is the low end. Tesla can and does have a decent business selling high-end expensive long-range EVs.

But their cheapest car is currently $49,000.00 That is out of reach for most.

The EV biz needs good affordable EVs. That is extremely hard to do. We might need more PHEVs and medium range EVs (120 to 150 miles). But a lot of people want a car that can handle long trips and the medium range EVs are not good at that. So PHEVs may be a growth sector if we want to move the masses electrified driving. The Volt. The Pacifica. The Mitz Outlander PHEV.

The EV fans want pure EVs….but at $49K for the cheapest one…they are kinda out of reach.

earl colby pottinger

But just a few years ago the cheapest they sold was over $80,000 and near the beginning you better had $100,000 with all the support systems you needed.

I think I see a trend there. 🙂

mir

Following the trend, we might have actually affordable EVs around 2025. Hey, that’s about the timeline most big auto was giving on their new models…funny how it works huh?

G2

Sorry; why are you ignoring the LEAF & BOLT for lower priced EVs, Speculawyer?

Cypress

Those are still $30k and up. Lots of cars available for under $20k.

Cypress

So odd that anyone down voted you that.

AP

Awww, poor VW. I think I’m going to dump my Model 3 and get a diesel, cough cough…

wavelet

My take from this is that VW management is speaking with multiple contradicting voices. On one hand, all the announcements about huge investments in battery plants, multiple lines of new BEV and PHEVs, million EVs/year in the near future. On the other hand delays in the roadmap, and Doom & Gloom statements from the CEO about transitioning to EVs..
Very bad, and I hope the board of directors will settle things and kick out any execs not on board with the program. If the CEO doesn’t believe in the company’s stated direction, he shouldn’t be working in it.

ffbj

It’s all doublespeak for the powers that be. That is VW real audience. Look what we are doing to change, and if you really lay into us, just think of all the jobs that will be lost. When you consider who they are actually talking to, it makes perfect sense.

Clive

Many can look forward to ridiculously low lease deals.

DonC

He’s probably right and I’m surprised anyone here wants to argue the contrary. If manufacturers can produce vehicles with only 10% of the parts and only 10% of the moving parts as what they use now, the industry changes dramatically. Taking out 90% of the parts takes out 90% of the suppliers, which means the industry is downsized in an extreme way, which is another way of saying the industry as currently construed is destroyed. Overall 100,000 job losses seems a conservative estimate. Super big deal for Germany since the car industry is a very large part of the economy.

Autonomous vehicles also reduce vehicle ownership. That takes out the dealers which will cause another huge job loss. And then of course autonomous vehicles eliminate drivers, which is the occupation for a large number of low skill men.

Overall huge economic dislocations. As a famous communist once said, you can’t make an omelette without breaking a few eggs.

Will

Yeah don’t make sense that people would want a disruption of Automotive industry with ai. Yes capitalism is Efficiency of goods and services but to what extent. Here in the US the Great Society programs and New Deals that were pillars of the Welfare state is dead and will be dead if Ai comes out in a few years with one rule GOP party in power.

Tony Marco

RIP VW – cough cough – that diesel smell is killing me !

BoltUp

And out of the ashes of the old, the new will rise and quickly fill the space.
VW, stop whining and make change happen.

leafowner

Tesla took the old failed Fremont facility — and look at it today!! Who is next to fail? And will Tesla be able to pick up assembly facilities on the cheap and convert them? I think that is a more likely scenario. I’m sure there may be a Ford facility available in Europe soon…..and how long can companies like Mazda survive?!? I think Elon is waiting for the next automotive correction to kick in — and Tesla will swoop in and buy a bankrupt brand and their facilities for a song….

G2

On. The. Nose. Leafowner!

Warren

Dung Beetles!

Harold T

100,000 will go away. You need about 1/3 the parts, Increased automation, globalization and cheap labor in China, 100,000 is nothing in the grand scheme.

Kosh

Newsflash circa 1900: Horse Shoeing industry will collapse due to the adoption of automobiles.

In other news: Doctors expect increase in health due to lack of horse sh*t on the roads.

Will

Horse industry was not as big as the car industry

Buutvrij

I read dutch and german automotive news about VW, Audi and their budget brands (Skoda and Seat) for the past 20 years or so.
I tell you: VW is scum. Always manipulating the laws over here, letting customers down (rubbish oil drinking 1.8 / 2.0 TSI, DSG, TDI Dieselscandal, gearboxes and a lot of other real issues), telling lies, dragging their feet (also with hybrids). It really is the glory of European car mafia, backed by mutti Merkel. Polluting and killing european citizens softly with NOX (still some 10 million dieselcheaters on our roads today)
No real innovations ever. The VW PR/marketingmachine is sublime. Their products are trash and so is their behavior.

Milfan

So they will not sell 3 million electric vehicles as they promised by 2025, instead they will sell only 300,000 (without 1 extra 0). Lets see what statement they are bringing in 2024 for this 300,000.

VW ID will soon end up as unIDentified driving object (UDO).
VW e-UP is not in the news, is it still sold.

How are they going to survive in Chinese market needs to be seen.

Cypress

Where did you get they are changing plans on the number of EVs sold?

MoMac

What was left out was that the VW CEO also called a tightening of the climate targets by a maximum of 30 percent (by 2030) as justifiable.

It was the 40 percent that EU originally wanted that he had a problem with.

CARLOS

difference between Tesla and VW:
Tesla have a mission.
VW lies to their customers and to the government.

AndySpruce

Personal ownership of cars is almost certainly going to end for most people within 20 years. The combo of EV cars and autonomous driving will lead to inexpensive UBER type services (at least in urban areas) and the poor relative economics of owning a car will mean the vast majority of families won’t. So yes, ICE cars are going to disappear but so are the majority of cars …period. Estimates are #’s of cars will shrink by 80%. Sure, there are issues (e.g. electrical capacity to power the cars, rural areas, …) but most car manufacturers will simply go bankrupt within 20-25 years. (and any that don’t support EV cars fairly quickly will die even sooner.

DonC

Agree completely. It’s surprising that so many here don’t see this. They just assume the industry will be the same, with manufacturers selling vehicles to individuals, with the only difference being the vehicles will have electric drive trains rather than ICE drive trains.

But I think the CEO is currently more worried that electric vehicles can be supported by a much smaller manufacturing base and that their simpler architecture means lower barriers to entry, more competition, and lower margins.

The drive sharing you’re talking about is bad for all auto makers but especially for the German companies. They tend to sell a premium product at premium prices, but no one will be willing to pay for a logo on what is essentially a taxi.

G2

Agree with most of what you said AndySpruce, except about the grid, that part is not supported by any major utility. In fact utilities are looking forward to greater demand to counter the last decade of flat demand due to more efficient appliances and LED lights😀

Independence01776

Agree that autonomous driving will result in an bigger disruption than EV’s. May only be a few auto companies left standing and I think it will happen in 10 years not 20. There’s going to be a lot of used cars for sale on the cheap when you find that paying a monthly service fee of $100 dollars allows you to have the latest model of any type car you wish anywhere, at any time of the day.

David Wolff

No need to worry about Jobs in Germany. Grohmann makes the robots for Tesla….

The impact of change is much more dynamic then simply 100,000 jobs. There are 2000 parts to assemble in ICE, All of those parts manufacturers will begin laying off. After market parts stores, gas stations, repair shops/dealerships. When conversion reaches 10% globally (perhaps by 2023) the financial volume that supported all of those industries will be effecting each of them equally. The financial savings is to the consumer that no longer goes to all of these corporate entities.

DonC

I think it’s more like 30,000 parts if you’re actually counting. Probably 10,000 if you count major parts. And yes, if you take out 90% of the parts then you can build cheaper vehicles with 10% of the people and 10% of the suppliers. As you say, cascading layoffs.

While you need fewer people this also lowers barriers to entry so competition increases. Hence lower margins.

Don’t agree that the financial savings gets transferred from the manufacturers to consumers. Right now oil companies make more on cars than the car manufacturers do. And it’s not so much a transfer. It’s more that a lot of the costs disappear. This really happens when people don’t need their own car, which might take the cost from $1.50 per mile to $.20 per mile.

Gabe Wilson

Entire other industries will close down too as self-driving cars will lead to many fewer motor vehicle collisions. Currently 40k deaths each and every year – a complete disaster that keeps repeating itself; and millions injured annually.

-Trauma centers will close
-insurance companies will have significantly fewer claims
-liability and disability lawyers and ancillary services will be out of work
-courts will have a significantly fewer numbers of cases
-body shops will close
-assessors will be out of work
-rehab jobs will decrease significantly
-rehab facilities will close
The system will save billions in cost due to many fewer missed days of work, insurance costs and payouts.
And the list goes on and on.

Prad Bitt

B.S. and blackmail.

Bloggin

ICE automakers brought the drama on themselves by waiting til they were ‘forced’ into EVs, as opposed to leading the transition. VW is the worst offender since they were deceitful about their ‘clean’ diesel and had to get busted to change their tune. Others made half hearted attempts offering EVs, with automakers like Ford who are so far behind, trying to wait for the market to mature before entering,….taking the cowards approach won’t help them.

But like any transition that benefits the consumer, the ICE auto industry has to be ‘forced’ into it. But that’s fine….I am buying a Tesla anyway!!

Mister G

VW HOGWASH

Bob Wilson

Sounds like VW is inviting the ‘short sellers’ to start their death watch.

Independence01776
The problem for these companies is they get expert advice from folks in their industry, who because they come from that industry do not ask the right questions. 1) They may understand that a lower cost of battery has allowed Tesla to build a roadster and then model S. But what they don’t get is that once a price point is reached and real sales with profits can be gained, it accelerates the investment available, drives ever accelerating price declines and then on top of that you start to see additional price declines due to economies of scale and finally beefed up by competition which is realizing they may have to sell at a loss to stay relevant and not go out of business. Batteries are a real life example. But you could also look at Solar, or wind, or cell phones, etc. THe pattern for each is very similar for each. Battery prices declined 5 to 10% from 2000 to 2010, due mostly to use in computers and cell phones. Then from 2010 to 2015 they declined on average by 15% per year as the initial EV’s drove further innovation and growth. The last 3 years the battery price… Read more »
G2

Dinosaurs will be dinosaurs…
https://goo.gl/images/51HGAf

Rolando

The German Big-Auto corporations were already challenged with bankruptcy every time :
– when the 3-way catalytic Gasoline exhaust filtering was mandated,
– when airbags were required,
– when Diesel NOx filtering was required,
– when Euro-3, Euro-4, Euro-5, Euro-6 emission norms were mandated …… and so endless on …..

every time the entire industry and millions of jobs where endangered by each of those laws.

LarsP

Try consider the responsibility these people have for hundreds of thousands of employees. This article is simply too stupid. I can’t waste my time on InsideEVs any longer…

G2

B-bye!

Terawatt

> Building electric cars is not easy

More specifically, making money building electric cars is not easy. Yet.

Terawatt
> The Parliament was aiming for a 40-percent emissions reduction, while the German auto industry was pushing for 30 percent. Now, the goal has been set at a 35-percent reduction by 2030. The industry is doing what it can not just to lobby, but also to cheat again. First they convinced the weak/incompetent regulator that the limits (using WLTP) shouldn’t be absolute, in grams/km, but rather percentages from a baseline established the first year with WLTP in full force (that’s 2021). Having accomplished that, they then started actually *inflating* their consumption (and hence emissions) measurements so as to create a higher baseline – and then they can emit more grams/km every year until at least 2030 – longer if the next target simply extends the current one. Transport & Environment has reported that the evidence points to this little trick effectively halving the *real* CO2 reductions. Hence we have the democratically elected institution wanting to reduce emissions by 40% but settling to limit that to 35%, but getting only 17.5% or so. While I despise auto makers for playing this dirty game, I think the responsibility ultimately lies with the regulators. Sooner or later we need to understand that having… Read more »