Chancellor Olaf Scholz urged Germany’s carmakers to embrace competition from Asian rivals and not be intimidated by the rise of China’s electric-vehicle manufacturers.
(Bloomberg) — Chancellor Olaf Scholz urged Germany’s carmakers to embrace competition from Asian rivals and not be intimidated by the rise of China’s electric-vehicle manufacturers.
“Competition should spur us on, but not scare us,” Scholz said Tuesday in a speech at the IAA auto show in Munich, insisting that “there is no question about the international competitiveness of Germany as a car nation.”
“Yes, good cars are also being built and developed outside Germany,” he added. At the same time, he said that he could “hardly think of any other location in the world that has such a wealth of expertise in automotive engineering” as Europe’s biggest economy.
German brands like BMW, Mercedes and Audi long dominated sales of premium combustion-engine cars in China, but European manufacturers have been slow to tap into the Asian country’s rapid shift to electric vehicles.
Led by BYD Co., Chinese carmakers will almost double their share of the auto market to 33% by the end of the decade, UBS analysts wrote in a report published last month.
BYD overtook Volkswagen AG this year as China’s top-selling automaker, and Mercedes slashed prices for its flagship electric sedan there late last year after disappointing sales.
Electric cars and plug-in hybrids are expected to make up 90% of the world’s biggest auto market around the end of this decade, while a price war in China started by Tesla Inc. has also increased the pressure.
Scholz said it’s “no coincidence” that Tesla built its European plant in the eastern German region of Brandenburg and that Ford Motor Co. decided to manufacture electric cars for the European market in Cologne. “All of this is an expression of our country’s capabilities,” he added.
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