Top German car executives including Daimler chairman Dieter Zetsche and Volkswagen chairman Martin Winterkorn made an expensive promise to Chancellor Angela Merkel in May 2010, when they vowed to put a million electric cars on Germany’s roads by the end of the decade. So far, the number of vehicles with electric or hybrid drives remains miniscule, barely reaching one percent of all new registered cars.
But those numbers will likely increase, as the European Commission, unlike the German government, steps up pressure on automakers by requiring the average vehicle emission to fall below 100 grams of carbon dioxide or less per kilometer by 2020. The European auto industry is nowhere near achieving that reduction, forcing manufacturers to assume the costs of the advanced technology without profiting from it.
In Copenhangen, Ola Källenius, Daimler’s executive vice president of sales and marketing for Mercedes, recently showed what the future could have in store when he presented a new Mercedes-Benz S-class with hybrid drive. The car can travel 30 kilometers (18.64 miles) on electric power only and, when using fuel, up to 100 kilometers per 2.8 liters. Its carbon dioxide emissions are just 65 grams. And its price is comparable to S-class vehicles with a conventional drive.
Daimler is absorbing the added costs for the supplemental electric motor and all the other technology that replaces the internal-combustion engine during short distances because, according to Mr. Källenius, customers aren’t willing to pay more. More than 10 percent of Daimler’s vehicles must be hybrids by 2020, or about 200,000 units per year, if the carmaker is to meet the environmental goals.
As for the other German carmakers, Porsche is selling its Cayenne SUV as a hybrid without a price increase. Next year, BMW aims to roll out a new top of the line model 7-series that will incorporate lightweight carbon fiber components and a hybrid motor. The current 7-series model offers a hybrid variation, but at a steep markup over internal-combustion-only engines.