Daily briefing

Carmakers are doing it for themselves… in China

A staff cleans the bonnet of BMW 118i car during the Imported Auto Expo in Beijing
Source: Reuters

As carmakers’ business sputters in Europe, they’re stepping on the gas elsewhere.

New environmental regulations set by Brussels require carmakers to reduce emissions by 35 percent by 2030. That means nine out of 10 cars sold  in Germany have no future. While politicians heave a diesel-y sigh of relief, carmakers are wringing their hands. Auto companies are already struggling to meet the intermediary standards. Now, they must amp up their fleets so they are 50 percent electric by 2030. That’ll be an uphill struggle: Even with subsidies, e-vehicles make up a mere 2 percent of the fleets of Germany’s carmakers. Now, VW has announced job cuts, and auto journalists here call it the end of an era.

No wonder carmakers are trumpeting profitable adventures abroad. BMW just signed a historic deal to become the first German carmaker to take a majority holding in a China joint venture with Brilliance, a local carmaker. The move helps BMW, which will build a new plant in China. And it’s a signal of encouragement from Beijing too, after the notorious difficulties for foreign companies doing business there. Let’s see whether this marks a new chapter.

Whether or no, it’s all ni hao now, after Daimler also announced plans for a joint venture with Geely, a Chinese shareholder, to boost ride-hailing and car-sharing as car ownership declines. The two will take on market leader Didi Chuxing. That’s bold – especially amid the leadership transition at Daimler, which loses its CFO and mustachioed CEO in the next year. Ola Källenius, all eyes are on you.

I am also keeping a beady eye on billionaire migration – as are watchdogs which warned EU countries yesterday about the potential cost of selling visas. Business is flourishing for the sale of residence permits and passports, with prices starting out at €250K in Greece and rising to €10 million in Austria. Such golden visa schemes are an open door to crime, though, as officials often diligently look the other way.

A more wholesome exchange took place over apples in Germany’s cabinet yesterday. Local apple queens clad in traditional dress handed baskets of locally-grown apples to members of the cabinet. It’s an annual tradition from the agriculture ministry and could be interpreted as a giant, healthy thanks for Berlin’s tenth emergency aid program for farmers in a decade, after a punishingly hot summer. This year’s drought decimated potato, corn and grain harvests and some farmers are likely to be compensated. Politicians, meanwhile, may need to dust off their cider press or dig out a chutney recipe to deal with those 2,000 apples.

Government-wise, we’re looking ahead to what Sunday’s state elections mean for the coalition and for the interior minister. O Bavaria. Polling says the Green Party is reaching new records, while the CSU keeps losing votes; and the AfD is polling ahead of the Social Democrats. Will Seehofer be able to stay if his party doesn’t win an absolute majority? Could it topple the coalition?

For now, we have Stormy Daniels who has just reached Germany. She’ll be the starring guest opening the upcoming Venus erotica trade show in Berlin. In the meantime, she tweeted that her book “Full Disclosure” has hit the NYT bestseller lists. She’s getting a warm welcome in Germany, anyway, for that boost to the publishing industry and beyond.

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