Electrify me

Germany's failed e-car policy needs a fix

main 28210841 DPA-Chancellor Angela Merkel electric cars charging point energy e-car auto mobility automotive Germany BMW VW Daimler Mercedes
Only 709,429 to go. Source: DPA

Germany has not only been late in making attractive electric cars, its citizens are also reluctant to buy them. A new report on the country’s sluggish progress on electric cars predicts that the planned 1 million target for e-cars on German roads by 2020 will not be reached, Handelsblatt has learned.

Instead, 2022 seems more likely, according to the National Platform for Electric Mobility (NPE), a council set up by the government in 2010 and led by former SAP chief executive Henning Kagermann. At the start of this year, there were only 290,571 electric and hybrid vehicles registered in Germany (see graphic below).

In 2009, Chancellor Angela Merkel set the 1 million target to help Germany’s car industry develop a domestic market – and prevent upcoming rivals, such as Tesla and China’s BYD from overtaking the titans VW, BMW and Mercedes-maker Daimler. E-vehicles would also help to meet the nation’s climate goal of reducing carbone dioxide emissions by 40 to 42 percent in 2030 compared to 1990-levels and virtually CO2-free traffic by 2050.

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Germany has lagged on e-cars because its manufacturers have been late to roll them out, according to the council. While Elon Musk regularly steals the limelight with Tesla, the electric cars made by German makers are hidden in car showrooms. There’s also a shortage of charging points and politicians took too long to introduce subsidies for electric-car buyers. The incentives came in 2016, but there have only been 75,338 applications since then.

Mr. Kagermann, who had considered to resign from the e-car council because of the lack of political support, updated Ms. Merkel on Wednesday of his findings. On the one hand, he remains optimistic, predicting battery-powered mobility is on the brink of huge global expansion. By 2020 global e-car production will rise from 1.4 percent last year to 10 percent of total passenger car output, reaching 25 percent in 2025. They will account for a 4 to 6.5 percent share of the German market, he predicts.

On the other hand, Germany must do more to reach the goals in 2022 and 2025. Mr. Kagermann calls for an investment campaign in charging points and says 2.4 to 3.5 million private charging points must be installed by 2025 for the government to reach its goals. He also wants cities to get serious about giving e-cars concrete preferential treatment over conventional cars, for example by making free parking available and allowing them to use bus lanes. In addition, electric city buses are needed to help cut nitrogen oxide emissions and avert looming driving bans for older diesel cars.

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The council wants the government and auto manufacturers to invest €1 billion ($1.17 billion) by 2020 in new automotive technologies and to step up research into battery technology to ensure that Germany won’t have to rely on importing next-generation lithium-ion batteries from Asia.

And it wants research into an “active, forward-looking shaping of structural change” that will engulf the German auto industry with the switch to electric when the tens of thousands of car workers employed in conventional engine and drive manufacturing will no longer be needed.

The council won’t be around to address these issues much longer because it will be merged into a new organization, the Platform Future of Mobility (NPM). It too will combine government officials with industry representatives, researchers and trade unions and will be led by Mr. Kagermann. Its focus will be broader though, not just on e-cars but on alternative fuels, digital change, securing employment and industry norms and patents.

Whether Mr. Kagermann will still head the new council in 2022, remains to be seen. He is already 71 and will retire at some point, whether there are 1 million e-cars on the road or not.

Daniel Delhaes reports on politics from Berlin. He focuses on Angela Merkel’s conservative party CDU and her Bavarian ally, the CSU, and covers the topics of infrastructure and digital transformation. To contact the author: delhaes@handelsblatt.com

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