I will never forget that lesson in superiority from the German executive. It was in the good old days of the combustion engine. He invited me to get into a car that had just come off the assembly line. We closed the doors and started the engine.
–Tell me, what do you hear?
I didn't hear anything. No noise coming from outside. No engine murmur. Nothing.
–Do you understand it? –She smiled kindly– That is only possible with German technology.
I admit it looks like an advertisement. But it was like that. The automobile was the most powerful industry, the one that innovated the most and the one that justified German hegemony on the continent. Two decades have passed since that day and in The Economist they speak again of Germany as the “sick man of Europe.”
The bad situation in Germany has to do with their decisions. In energy. And in the electric car, to which they have arrived late in a market today dominated by China.
Deciding on a car has never been easy. Today it is more difficult. There are electric cars. There are hybrids. Plug-in hybrids. Gasoline cars. Second-hand cars at skyrocketing prices due to lack of the first ones. Models that take months to arrive... And there are Chinese electric cars. Cheaper.
The European Commission has announced that it will investigate whether Chinese cars are subsidized and are unfair competition for European manufacturers. It is true: there are local Chinese governments that have given the land to manufacturers or have financed them with zero credits. But it is also true that steel and electronics are cheaper there. And that the Chinese are far ahead in the manufacture of batteries.
China floods the world with cars today as it did with Christmas items decades ago. Chinese exports have fallen. But not the car ones, which don't stop going up. There is so much production capacity and there are so many electric cars on the local market, that manufacturers do not know what to do with the stocks of gasoline cars. They have no choice but to export.
Every time I see a Chinese car (and I will see more every day) I remember the German executive. And how difficult it must be to make the right decisions when you are so high up.
