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China is outcompeting Germany as a manufacturer of high value goods, particularly cars [1][2]. Last year it overtook Germany as the second biggest car exporter.

China is outcompeting Germany as a manufacturer of high value goods, particularly cars [1][2]. Last year it overtook Germany as the second biggest car exporter. In the first three months of this year, China has surpassed Japan to become the world's top car exporter for the first time. This is due to its strength in EVs (while Germany's strength is in ICEs). Volkswagen holds a 2% share of the Chinese EV market while the Chinese BYD dominates with 40% (Tesla in second at 10%) [3]. It won't be long until Europe imports more cars from China than China imports cars from Europe. If you had said this only a few years ago most Europeans would have laughed in disbelief. With a world moving away from ICE to EV, and with Chinese brands winning at home and abroad, it presents a double whammy nightmare for Germany. Lowered exports to China, plus lowered exports in other markets. And this is all on top of energy prices from the fallout of the conflict in Ukraine, the shut down of nuclear power thanks to the Greens and the geopolitical tensions between the West and China. While Germany's economic model has served it well during an era of a rising China, it may not be the case in a era of a risen China. [1] China’s carmakers outstrip foreign brands in its electric vehicle boom https://www.ft.com/content/dd149923-1c5d-4e5e-8be6-d979aa48aa33 https://www.ft.com/content/dd149923-1c5d-4e5e-8be6-d979aa48a... [2] Big drop in German exports to China raises fears over EU’s economic powerhouse https://www.ft.com/content/3034d39c-118a-44d3-b9bf-6482b786018f https://www.ft.com/content/3034d39c-118a-44d3-b9bf-6482b7860... [3] Can Volkswagen win back China? https://www.ft.com/content/afad4566-6404-483e-934f-c905507bf1d0 https://www.ft.com/content/afad4566-6404-483e-934f-c905507bf...

seydor 3y ago
who can realistically challenge the chinese EV market in terms of efficiency / cost? simplicity of EV motors + established industry + possible commodity imports from russia
- bryanlarsen 3y ago
  Tesla has a 10% market share in China.
toddmorey 3y ago
Agreed that Europe & US manufacturers will lose Chinese domestic market. Any data to show Chinese EVs taking over Europe though? Haven’t seen that happening.
- bryanlarsen 3y ago
  Most Tesla's sold in Europe have been Chinese made. That'll change as their Brandenburg plant ramps up. Volvo, MG4 and Polestar are Chinese owned and mostly manufactured in China.
  - mytailorisrich 3y ago
    BYD has also a deal with Tesla to supply batteries for Tesla's Berlin factory.
pulse7 3y ago
...and all this happened because German car makes were willing to give COMPLETE KNOW-HOW (on how to make good cars) just to be able to sell in Chinese market... Now China has learned how to make good (enough) cars and - they will out-compete Germans with low prices... Who wants to pay 60.000€ for an electric car in you can get one for 30.000€ from China?
- amadeuspagel 3y ago
  It happened because German car makers were not willing to commit to electric cars.
  - c00lio 3y ago
    That too. German car makers got lazy with research and development. In addition, they were hesitant to give up their investment in ICE production, risk staff reductions, and corresponding political and strike problems. This lead to most of the knowledge around EVs being developed and patented elsewhere, especially battery knowledge is firmly in Chinese hands. At the same time the grandparent is also right, China wisely required knowledge transfers (in the form of forced joint ventures) in exchange for production and sales licenses. German car makers stupidly and greedily agreed, providing the Chinese with valuable knowledge about all the other parts of a car. Both those mistakes now mean that Chinese companies have all the necessary patents and knowledge, as well as experience, for building EVs. Whereas German car makers will need to buy, license and beg for parts in China. Not to mention that production in China will of course always be cheaper, and bureaucracy easier in the relevant circumstances.
    - bryanlarsen 3y ago
      Shipping and trade barriers are still significant for vehicles. The fact that BYD is looking to build a factory in Europe rather than importing from China shows that local manufacturing still has an advantage.
      - c00lio 3y ago
j-pb 3y ago
> the shut down of nuclear power thanks to the Greens The decision to shut down our nuclear reactors came from a conservative government, where the greens were in the opposition. The prices have not been rising due to the shutdown of our nuclear plants, but due to price gauging by electrical companies, and due to russia falling away as a cheap gas supplier. Nuclear only made up 5% of our energy production 2023 and 11% in 2021, with ~4.3Gw and ~8.5Gw respectively. Germany installed 7.2Gw of PV and ~2.4Gw of Wind in 2022. Replacing our entire nuclear capacity with renewables within a single year. The conservative government of the last 20 years spend an insane amount of effort to stop renewables by limiting the yearly installed PV capacity by law, and introducing NIMBY friendly limitations on where wind turbines can be build, bloating the documents required for clearance from a couple dozen pages to a full binder. The conservative government were also the ones starting the NordStream projects and overseeing their construction. They are directly culpable for our dependence on russia. The greens have to spend a lot of effort on reversing those legislations, and they had to do this in addition to handling the Ukraine crisis, and while constantly fighting a conservative/neoliberal party that is part of the government but has made it their stated goal to sabotage everything the greens propose. (They are basically a lobby arm of the german car industry, with several scandals.) The fact that they managed to push for this much renewable energy, and for this much energy independence is a small miracle tbh. Also if the conservatives hadn't sabotaged our "Energiewende" and had guided our car industry towards EV, we wouldn't have the issues you pointed out.
- achates 3y ago
  [dead]
- cbmuser 3y ago
  > The decision to shut down our nuclear reactors came from a conservative government, where the greens were in the opposition. Wrong. The nuclear phase-out original came from SPD/Greens: > https://de.wikipedia.org/wiki/Atomkonsens https://de.wikipedia.org/wiki/Atomkonsens > The prices have not been rising due to the shutdown of our nuclear plants, but due to price gauging by electrical companies, and due to russia falling away as a cheap gas supplier. They have not been rising since last month, but that's not really a reliable statistics. After all, the German Ministry of Economics is working on a law to subsidize electricity prices for the industry. They wouldn't do that if electricity was cheap. > Nuclear only made up 5% of our energy production 2023 and 11% in 2021, with ~4.3Gw and ~8.5Gw respectively. Germany installed 7.2Gw of PV and ~2.4Gw of Wind in 2022. Replacing our entire nuclear capacity with renewables within a single year. Nuclear provides baseload, wind and solar don't. In fact, since 2022, Germany returned 19 coal-fired power units with a capacity of 7.3 GW to the electricity market: > https://www.smard.de/home/rueckkehr-von-kohlekraftwerken-an-den-strommarkt-209208 https://www.smard.de/home/rueckkehr-von-kohlekraftwerken-an-... > The conservative government of the last 20 years spend an insane amount of effort to stop renewables by limiting the yearly installed PV capacity by law, and introducing NIMBY friendly limitations on where wind turbines can be build, bloating the documents required for clearance from a couple dozen pages to a full binder. That's non-sense. Germany built more wind and solar capacity per capita the past 20 years than any other country in the world. Even one of the strongest EE lobbyists in Germany, Volker Quaschning, admitted that: > https://twitter.com/VQuaschning/status/1626149341730639872 https://twitter.com/VQuaschning/status/1626149341730639872 > The conservative government were also the ones starting the NordStream projects and overseeing their construction. They are directly culpable for our dependence on russia. That's a blatant lie. That project was started by SPD/Greens and the Greens even defended it against criticism: > https://dserver.bundestag.de/btp/15/15186.pdf https://dserver.bundestag.de/btp/15/15186.pdf (p. 10) > https://www.stern.de/wirtschaft/news/nord-stream-juergen-trittin-lobt-bau-der-ostsee-pipeline-3571140.html https://www.stern.de/wirtschaft/news/nord-stream-juergen-tri... > https://www.spiegel.de/wirtschaft/soziales/russland-juergen-trittin-verteidigt-nord-stream-2-a-1244845.html https://www.spiegel.de/wirtschaft/soziales/russland-juergen-... > The greens have to spend a lot of effort on reversing those legislations, and they had to do this in addition to handling the Ukraine crisis, and while constantly fighting a conservative/neoliberal party that is part of the government but has made it their stated goal to sabotage everything the greens propose. (They are basically a lobby arm of the german car industry, with several scandals.) The Greens have always been fighting nuclear in Germany. So much, that they even preferred subsidizing coal: > https://dserver.bundestag.de/btd/10/014/1001407.pdf https://dserver.bundestag.de/btd/10/014/1001407.pdf > https://dserver.bundestag.de/btd/11/056/1105633.pdf https://dserver.bundestag.de/btd/11/056/1105633.pdf > The fact that they managed to push for this much renewable energy, and for this much energy independence is a small miracle tbh. What energy independence? Are you aware of the fact that the current coalition has new gas plants in their coalition agreement: > https://www.bundesregierung.de/resource/blob/974430/1990812/04221173eef9a6720059cc353d759a2b/2021-12-10-koav2021-data.pdf?download=1 https://www.bundesregierung.de/resource/blob/974430/1990812/... (p. 58) And the Greens even have it in their election program: > https://cms.gruene.de/uploads/documents/Wahlprogramm-DIE-GRUENEN-Bundestagswahl-2021_barrierefrei.pdf https://cms.gruene.de/uploads/documents/Wahlprogramm-DIE-GRU... (p. 24) And even the government's own planning agency for the energy transition is projecting that we need lots of gas power plants: > https://www.dena.de/fileadmin/dena/Dokumente/Pdf/9262_dena-Leitstudie_Integrierte_Energiewende_Ergebnisbericht.pdf https://www.dena.de/fileadmin/dena/Dokumente/Pdf/9262_dena-L... (p. 29) > Also if the conservatives hadn't sabotaged our "Energiewende" and had guided our car industry towards EV, we wouldn't have the issues you pointed out. The only parties that have sabotaged Germany's electricity grid and climate goals are the Greens with their owngoing FUD campaigns against nuclear power. I'm really surprised how one can put so much disinformation into a single comment post.
apexalpha 3y ago
The Chinese are doing great but for now I think about 60% of Chinese EV exports are Tesla's produced in Shanghai. While I'm sure the actual Chinese brands will catchup the German are also not sitting still. VW is going strong on EVs and other brands are not far behind. If we look at the issues Tesla has with quality control the Germans are still coming from a position of strength, even if they are ICE specialists.
notdang 3y ago
Not sure about Germany, but in my country of 120mln people I don't see many EVs, but I see a lot of Chinese ICE cars lately, those cars are good enough and with the latest cars price increase, a lot of people prefer them over the Japanese/US/EU manufactures
- 2-718-281-828 3y ago
  Mexico doesn't have infrastructure for EVs and people are mostly not wealthy enough for them?
reisse 3y ago
Adding insult to injury, Germany (and other European carmakers) voluntarily withdrew from Russian market, writing down local assets. Then Chinese companies entered the country, negotiated very cheap reusing of abandoned factories (the main condition AFAIK was just to keep people employed), and now dominate the Russian market. And even the new VW cars sold in Russia are now Chinese-built versions imported without VW's consent.
- red-iron-pine 3y ago
  Meh. At this point China will dominate most things in the Russian market. They're gutting their economy and exacerbating a demographic crisis via heavy losses and huge departures. Outside of nukes they will otherwise be China's pet for the next few decades.

seydor 3y ago

who can realistically challenge the chinese EV market in terms of efficiency / cost? simplicity of EV motors + established industry + possible commodity imports from russia

bryanlarsen 3y ago
Tesla has a 10% market share in China.

toddmorey 3y ago

Agreed that Europe & US manufacturers will lose Chinese domestic market. Any data to show Chinese EVs taking over Europe though? Haven’t seen that happening.

bryanlarsen 3y ago
Most Tesla's sold in Europe have been Chinese made. That'll change as their Brandenburg plant ramps up. Volvo, MG4 and Polestar are Chinese owned and mostly manufactured in China.
- mytailorisrich 3y ago
  BYD has also a deal with Tesla to supply batteries for Tesla's Berlin factory.

pulse7 3y ago

...and all this happened because German car makes were willing to give COMPLETE KNOW-HOW (on how to make good cars) just to be able to sell in Chinese market... Now China has learned how to make good (enough) cars and - they will out-compete Germans with low prices... Who wants to pay 60.000€ for an electric car in you can get one for 30.000€ from China?

amadeuspagel 3y ago
It happened because German car makers were not willing to commit to electric cars.
- c00lio 3y ago
  That too. German car makers got lazy with research and development. In addition, they were hesitant to give up their investment in ICE production, risk staff reductions, and corresponding political and strike problems. This lead to most of the knowledge around EVs being developed and patented elsewhere, especially battery knowledge is firmly in Chinese hands. At the same time the grandparent is also right, China wisely required knowledge transfers (in the form of forced joint ventures) in exchange for production and sales licenses. German car makers stupidly and greedily agreed, providing the Chinese with valuable knowledge about all the other parts of a car. Both those mistakes now mean that Chinese companies have all the necessary patents and knowledge, as well as experience, for building EVs. Whereas German car makers will need to buy, license and beg for parts in China. Not to mention that production in China will of course always be cheaper, and bureaucracy easier in the relevant circumstances.
  - bryanlarsen 3y ago
    Shipping and trade barriers are still significant for vehicles. The fact that BYD is looking to build a factory in Europe rather than importing from China shows that local manufacturing still has an advantage.
    - c00lio 3y ago

j-pb 3y ago

> the shut down of nuclear power thanks to the Greens The decision to shut down our nuclear reactors came from a conservative government, where the greens were in the opposition. The prices have not been rising due to the shutdown of our nuclear plants, but due to price gauging by electrical companies, and due to russia falling away as a cheap gas supplier. Nuclear only made up 5% of our energy production 2023 and 11% in 2021, with ~4.3Gw and ~8.5Gw respectively. Germany installed 7.2Gw of PV and ~2.4Gw of Wind in 2022. Replacing our entire nuclear capacity with renewables within a single year. The conservative government of the last 20 years spend an insane amount of effort to stop renewables by limiting the yearly installed PV capacity by law, and introducing NIMBY friendly limitations on where wind turbines can be build, bloating the documents required for clearance from a couple dozen pages to a full binder. The conservative government were also the ones starting the NordStream projects and overseeing their construction. They are directly culpable for our dependence on russia. The greens have to spend a lot of effort on reversing those legislations, and they had to do this in addition to handling the Ukraine crisis, and while constantly fighting a conservative/neoliberal party that is part of the government but has made it their stated goal to sabotage everything the greens propose. (They are basically a lobby arm of the german car industry, with several scandals.) The fact that they managed to push for this much renewable energy, and for this much energy independence is a small miracle tbh. Also if the conservatives hadn't sabotaged our "Energiewende" and had guided our car industry towards EV, we wouldn't have the issues you pointed out.

achates 3y ago
[dead]
cbmuser 3y ago
> The decision to shut down our nuclear reactors came from a conservative government, where the greens were in the opposition. Wrong. The nuclear phase-out original came from SPD/Greens: > https://de.wikipedia.org/wiki/Atomkonsens https://de.wikipedia.org/wiki/Atomkonsens > The prices have not been rising due to the shutdown of our nuclear plants, but due to price gauging by electrical companies, and due to russia falling away as a cheap gas supplier. They have not been rising since last month, but that's not really a reliable statistics. After all, the German Ministry of Economics is working on a law to subsidize electricity prices for the industry. They wouldn't do that if electricity was cheap. > Nuclear only made up 5% of our energy production 2023 and 11% in 2021, with ~4.3Gw and ~8.5Gw respectively. Germany installed 7.2Gw of PV and ~2.4Gw of Wind in 2022. Replacing our entire nuclear capacity with renewables within a single year. Nuclear provides baseload, wind and solar don't. In fact, since 2022, Germany returned 19 coal-fired power units with a capacity of 7.3 GW to the electricity market: > https://www.smard.de/home/rueckkehr-von-kohlekraftwerken-an-den-strommarkt-209208 https://www.smard.de/home/rueckkehr-von-kohlekraftwerken-an-... > The conservative government of the last 20 years spend an insane amount of effort to stop renewables by limiting the yearly installed PV capacity by law, and introducing NIMBY friendly limitations on where wind turbines can be build, bloating the documents required for clearance from a couple dozen pages to a full binder. That's non-sense. Germany built more wind and solar capacity per capita the past 20 years than any other country in the world. Even one of the strongest EE lobbyists in Germany, Volker Quaschning, admitted that: > https://twitter.com/VQuaschning/status/1626149341730639872 https://twitter.com/VQuaschning/status/1626149341730639872 > The conservative government were also the ones starting the NordStream projects and overseeing their construction. They are directly culpable for our dependence on russia. That's a blatant lie. That project was started by SPD/Greens and the Greens even defended it against criticism: > https://dserver.bundestag.de/btp/15/15186.pdf https://dserver.bundestag.de/btp/15/15186.pdf (p. 10) > https://www.stern.de/wirtschaft/news/nord-stream-juergen-trittin-lobt-bau-der-ostsee-pipeline-3571140.html https://www.stern.de/wirtschaft/news/nord-stream-juergen-tri... > https://www.spiegel.de/wirtschaft/soziales/russland-juergen-trittin-verteidigt-nord-stream-2-a-1244845.html https://www.spiegel.de/wirtschaft/soziales/russland-juergen-... > The greens have to spend a lot of effort on reversing those legislations, and they had to do this in addition to handling the Ukraine crisis, and while constantly fighting a conservative/neoliberal party that is part of the government but has made it their stated goal to sabotage everything the greens propose. (They are basically a lobby arm of the german car industry, with several scandals.) The Greens have always been fighting nuclear in Germany. So much, that they even preferred subsidizing coal: > https://dserver.bundestag.de/btd/10/014/1001407.pdf https://dserver.bundestag.de/btd/10/014/1001407.pdf > https://dserver.bundestag.de/btd/11/056/1105633.pdf https://dserver.bundestag.de/btd/11/056/1105633.pdf > The fact that they managed to push for this much renewable energy, and for this much energy independence is a small miracle tbh. What energy independence? Are you aware of the fact that the current coalition has new gas plants in their coalition agreement: > https://www.bundesregierung.de/resource/blob/974430/1990812/04221173eef9a6720059cc353d759a2b/2021-12-10-koav2021-data.pdf?download=1 https://www.bundesregierung.de/resource/blob/974430/1990812/... (p. 58) And the Greens even have it in their election program: > https://cms.gruene.de/uploads/documents/Wahlprogramm-DIE-GRUENEN-Bundestagswahl-2021_barrierefrei.pdf https://cms.gruene.de/uploads/documents/Wahlprogramm-DIE-GRU... (p. 24) And even the government's own planning agency for the energy transition is projecting that we need lots of gas power plants: > https://www.dena.de/fileadmin/dena/Dokumente/Pdf/9262_dena-Leitstudie_Integrierte_Energiewende_Ergebnisbericht.pdf https://www.dena.de/fileadmin/dena/Dokumente/Pdf/9262_dena-L... (p. 29) > Also if the conservatives hadn't sabotaged our "Energiewende" and had guided our car industry towards EV, we wouldn't have the issues you pointed out. The only parties that have sabotaged Germany's electricity grid and climate goals are the Greens with their owngoing FUD campaigns against nuclear power. I'm really surprised how one can put so much disinformation into a single comment post.

apexalpha 3y ago

The Chinese are doing great but for now I think about 60% of Chinese EV exports are Tesla's produced in Shanghai. While I'm sure the actual Chinese brands will catchup the German are also not sitting still. VW is going strong on EVs and other brands are not far behind. If we look at the issues Tesla has with quality control the Germans are still coming from a position of strength, even if they are ICE specialists.

notdang 3y ago

Not sure about Germany, but in my country of 120mln people I don't see many EVs, but I see a lot of Chinese ICE cars lately, those cars are good enough and with the latest cars price increase, a lot of people prefer them over the Japanese/US/EU manufactures

2-718-281-828 3y ago
Mexico doesn't have infrastructure for EVs and people are mostly not wealthy enough for them?

reisse 3y ago

Adding insult to injury, Germany (and other European carmakers) voluntarily withdrew from Russian market, writing down local assets. Then Chinese companies entered the country, negotiated very cheap reusing of abandoned factories (the main condition AFAIK was just to keep people employed), and now dominate the Russian market. And even the new VW cars sold in Russia are now Chinese-built versions imported without VW's consent.

red-iron-pine 3y ago
Meh. At this point China will dominate most things in the Russian market. They're gutting their economy and exacerbating a demographic crisis via heavy losses and huge departures. Outside of nukes they will otherwise be China's pet for the next few decades.