Tesla’s plan to build Gigafactory 4 (GF4) in Germany makes sense if you look at it from the perspective of Tesla’s mission. Business Insider recently published an opinion piece on this topic, claiming the factory location didn’t make sense, and I am aiming to provide a different point of view of things.
Illusions are realities for those who have them. When you try to convince those having them that they are illusions, they try to convince you that they are the realists.
The German auto industry has been through quite a scandal surrounding dieselgate. But that’s not stopping some from clinging to diesel. The Verge reports, “Germany is divided about the future of its most important industry: while some automakers pursue electric vehicles, a noisy group of diesel-energy enthusiasts are expressing their frustration through protests. These have gone on every weekend so far this year.”
As a German engineer, I am today more concerned than ever about the ability of our auto industry to survive and prosper.
Europe’s automotive market is slowly getting charged. The drivers of electrification are EU regulatory agencies, which are imposing ever-stricter limits on carbon and nitrogen oxide pollution. Meanwhile, the German auto industry is pulling in the other direction, using its immense political power to try to delay and water down emissions regulations. The various European countries are caught in the middle — some are embracing the electric future, some are resisting it, and most are muddling through with no particular plan.
Mercedes, BMW, and Audi are rolling out their latest electric car offerings this week. But analysts say Tesla has little to be worried about.
The largest auto parts supplier in the world, Bosch, has decided that it won’t be manufacturing its own electric vehicle batteries, despite the booming of the sector — as the billions of euros of investment that would be required would pose too much of a risk to the company.
In its recently released annual report, Daimler has argued that investors should be aware that a shift away from diesel cars and towards electric vehicles could force the firm to bail out some of its suppliers — that is, to deliver “compensation payments” to them.
The German engineering and steel firm Thyssenkrupp is expecting that a surge in demand for automotive lithium-ion batteries over the next decade may lead to factory-gear order increases of more than €1 billion (~$1.2 billion), going on recent statements made by company execs.
The German car industry, led by Volkswagen, has been busy trying to convince European regulators to soften future emissions requirements. It seems their plan is working.
