
Will Tesla and Google Kill the German Car? - zwieback
https://www.spiegel.de/international/business/will-tesla-and-google-kill-the-german-car-a-1293415.html
======
Havoc
They're slow on the tech, but I think people are underestimating the
manufacturing & know-how advantage.

Tesla makes ~1k cars a day. VW is at 30k+....and has been for years.

Propulsion tech aside that's one hell of a learning curve advantage.

~~~
WhompingWindows
Most of those 30k+ are ICE vehicles, though. How much of the ICE vehicle
infrastructure and manufacturing capacity and know-how is going to be
irrelevant in the EV world? EV's have fractions of the number of parts, their
chassis and structure are categorically different due to battery vs fuel tank
and weight and aerodynamics, not to mention how much of VW's know-how is in
gasoline ONLY parts?

It just seems to me these legacy automakers who haven't done much at all are
in for a rude awakening. If battery costs keep declining, anyone who isn't
using a battery is going to get smoked on costs, and this is in a carbon-tax
free scenario. In many economies with environmentally friendly policy, we
should see EV's smoke ICE vehicles on cost MUCH sooner.

~~~
mdorazio
>How much of the ICE vehicle infrastructure and manufacturing capacity and
know-how is going to be irrelevant in the EV world?

Not very much. It really doesn't matter what kind of powertrain you have in
your vehicles, the biggest part of the manufacturing process is everything
else that makes up a vehicle. Frame, suspension, brakes, doors, windows,
seats, dash, cabin interior, lighting, electronics, safety systems, sensors,
testing, inspection, etc. etc. etc. On top of that, plenty of automotive
plants these days get fully-assembled engines and sometimes driveshafts as
well from other factories for efficiency and bolt them into vehicles rather
than doing build-up from scratch.

I've spent quite a bit of time in vehicle factories of several OEMs. I would
estimate that less than a quarter of an average factory line is used for
powertrain.

~~~
jcims
That’s at the assembly plant though where the powertrain resolves to a few
part numbers. In terms of R&D, warranty, service and overall longevity it
represents a lot more than that.

~~~
mdorazio
Agreed. Parts* & Service are two giant profit centers that take a big hit with
EVs, which is one of the reasons dealers have been so resistant to selling
them for years now. The actual manufacturing doesn't get a whole lot easier,
though, which is one of the reasons there have been so many EV startup
failures.

*Note: Parts here means only powertrain parts. Tesla, for example, is notorious for having massive delays in repair parts availability for things like doors, trim, and windows.

------
Barrin92
That is a very apocalyptic headline. Global electric car market share
projections tend to be quite spread but the high-end I have seen is something
around ~30% by 2040.

So even if German manufacturers were unable to compete with Tesla or Chinese
electric manufacturers at all which is in itself a questionable assumption,
the lions share of the market will still be traditional engines.

The entire article is very confused and mixes up autonomous driving with
electric vehicles and the emissions scandal so it's heart to discern a clear
point, but saying that Google is a competitor of Volkswagen is just a category
error.

~~~
kolinko
Here you go, 57% prognosis. But personally, I’d bet for 95% in 10 years (in EU
and US). Assuming the infrastructure is in place, I don’t see a reason for
people to buy ICU cars really...

[https://about.bnef.com/blog/electric-transport-revolution-
se...](https://about.bnef.com/blog/electric-transport-revolution-set-spread-
rapidly-light-medium-commercial-vehicle-market/)

„Based on analysis of the evolving economics in different vehicle segments and
geographical markets, BNEF’s Electric Vehicle Outlook 2019 shows electrics
taking up 57% of the global passenger car sales by 2040, slightly higher than
it forecast a year ago. Electric buses are set to hold 81% of municipal bus
sales by the same date.”

~~~
MrRadar
> I don’t see a reason for people to buy ICU cars really...

Yeah, who wants to put up with converting to and from UTF-16 all the time when
you're just trying to get to work in the morning?

------
notfromhere
It's questionable whether Tesla survives long-term.

~~~
quantdev
Tesla has over $5Bn in cash and positive operating cash flow. You can argue
about $TSLA the equity's valuation, but whether it survives long-term is no
more questionable than whether VW survives.

~~~
nostromo
$5b in cash... and $13b in debt.

~~~
quantdev
VW has $44b in cash and $160b in debt.

------
woodpanel
«I think it was the head of the self-driving division at Google. When we asked
him, “When do you think, we will find self-driving cars in cities?” He said,
“Well, I have a daughter who is 10 years old. And I think by the time she’s
the age of having a driving license, I hope that the Google car will be
operational in the city.” So that was about 10 years ago.» – Alain Bertaud

Having worked in the automotive sector of German and Japanese carmakers, with
European, Japanese and American plants I have to say news coverage on the
industry to me has devolved into something more resemblant of sports gossip.
I.E. there is an immense audacity of bystanders with zero experience in the
field to make bold claims about things like what the customers _really_ want
(the fans), which technology _really_ works (the strategy) or what kind of
fallacies CEOs and engineers fall for (team-management) that these bystanders
apparently all _get_.

The car is one of the most successful products in history, I'd like to call it
the German iPhone (although it took Americans to make it a mass-market product
in the first place). And like the iPhone it has left its visible imprint in
our public life. If you think digital detox is a thing, wait for how much bad
rep smartphones will get in 50 years (if they continue to exist). Cars shape
our surroundings for over hundred years now.

It is no wonder then that cars get to be the scapegoat for all sorts of
things. And it is no wonder that people have highly politicized arguments
about technologies, markets and processes of which they have zilch experience
whatsoever except their own filter bubble inflaters. Go to HN and say
something positive about Tesla and watch how you get downvoted. Say something
negative and watch how much faster you'll get downvoted. SUV drivers are
getting socially leprous [1][2] although it is the strongest selling car of
the last decades.

Talking about the automotive sector has become toxic.

[1]
[https://www.youtube.com/watch?v=9_lz0diqWJU](https://www.youtube.com/watch?v=9_lz0diqWJU)
[2] [https://www.tz.de/muenchen/muenchen-suv-fahrer-werden-
boese-...](https://www.tz.de/muenchen/muenchen-suv-fahrer-werden-boese-
angefeindet-zettel-auf-autos-zr-12837650.html)

------
AcerbicZero
I daily drive a VW Mk7 Golf R, (~$43k new) and I've driven a ~2017 Model S
(~$88k new) many times over the past few years. If I were to compare those two
vehicles on everything _except the engine_ , its an extremely tough sell for
the Model S. I'm a huge fan of what Tesla is doing, but the fit and finish,
build quality, and overall product at the end of the line felt seriously
unrefined at its price point.

It seems the mid-range of the EV market will get very crowded in the near
future, and unless Tesla (or for that matter BMW) find some serious advantages
I don't see how they'll compete with established automakers who are already
pumping out 30x the volume.

~~~
luckydata
Meh, the germans have been coming for a long time and have made zero dent. At
some point it will happen but it's easier for Tesla to improve their fit and
finish than for the germans to find a winning strategy in the ev market.

~~~
WorldMaker
The interesting bit is that the German manufacturers all seem to have aligned
on "some point" being somewhere between 2023 and 2025 as the date where they
all expect to sell more EVs than ICE. Post-dieselgate VW seems to have a fire
lit under them, and it's starting to sound a lot less like optimism and a lot
more like a threat (to American manufacturers). It sounds like it is going to
be very interesting to watch the next half-decade.

------
kenty
The article does not point out that German car makers have mastered two
things:

* A brand image of luxury, comfort with a touch of 'arrogance', epitomized in the BMW turn signal meme

* Creating a great looking and feeling interior

Just as the apple watch has shaken up the wearables market (see more here
[https://www.nytimes.com/2019/06/29/fashion/smartwatches-
appl...](https://www.nytimes.com/2019/06/29/fashion/smartwatches-apple-tag-
heuer.html)). The same is due to happen to the mass consumer car market.

Because of the two bullet points I do not see neither Mercedes or BMW in
trouble. However, VW is another story. I see them being in a 'stuck in the
middle' dilemma: Price wise, there is no beating the Chinese which can pump
out sub $20k electric cars and the Model 3 has shown that an upper bracket
$35k Tesla sedan can fulfill the vital requirements people have for electric
cars (range, charging speed, comfort). So in the end, I don't see them dying,
just losing a limb or two.

~~~
anon777778
I think you are heavily underestimating the size of VW. For example Audi (a VW
brand) is the direct competitor to BMW and Mercedes, while Porsche (and
Bentley, Lamborghini) are aiming even higher.

The only problematic brands are the ones like Skoda that try to build much
cheaper versions of VW cars (so for them EV might double the end price).

[https://en.wikipedia.org/wiki/Volkswagen_Group](https://en.wikipedia.org/wiki/Volkswagen_Group)

------
modzu
not likely. for example a big screen without tactile feedback is bad, stupid,
and dangerous in a car. its those sorts of things the germans got right that
dont even seem to be on teslas radar. it would drive me insane to drive a
tesla in a canadian winter, as much as i want to never visit a gas station
again!

------
aussiegreenie
There are many value investment videos saying that BMW is a much better
investment than Tesla. It already producing lots of EVs and making money on
them.

No one knows anything. Will an existing dealer network help or hinder? Will
there be a Foxconn of EVs? Will Amazon sell everything? Will there be a 90%
reduction in personal car ownership?

The car industry is massively over-invested. Most will die but who or what
will replace it?

My $0.02 worth is transport as a service will mean an 80% reduction in car
ownership. Only car nuts and people in remote areas will own a car.

~~~
dano
The frustrating part of BMW is that I'd like to replace my 325i sooner rather
than later with an all electric vehicle. My only choice in that price category
seems to be Tesla. How much longer do we have to wait for the Germans to put
forth their mid-priced line of all electrics? The i8 is just ridiculously
priced.

------
radium3d
Maybe German-made Teslas will be nice too if that is where their next factory
winds up? Instead of killing German cars they will become (partially) German
cars.

------
ngcc_hk
I looked at the 2nd hand Tesla car and i always wonder whether it is not the
production but the longer life (less corrosive part and/especially if battery
is replaceable ) plus full maintenance history (you pump, you hit, your
suspension). The industry is totally changed. You may not have the volume even
the no of cars are more.

------
beenBoutIT
Everyone will benefit when the sickening automobile life cycle of "new model
every X years" dies out for good. For that to happen it needs to die in
Germany just like it's dying in the US.

~~~
hedvig
Agile for car production?

------
crb002
BMW and others should be making BYOB (Bring Your Own Battery) models. Let the
dealers leverage the best battery for their market, and battery warranty
plans.

------
mips_avatar
Pretty soon the German automakers will stop bragging that their cars have “23
computers”. They’re computers in the way arduinos are computers. Their cars
have no capability of doing matrix math for any kind of real processing.

~~~
pintxo
You might want to watch this video [1] from 2013, showing a near standard
Mercedes S-Class in autonomous drive mode. A current overview can be found
here [2].

[1]
[https://www.youtube.com/watch?v=hIJeqD3Ax40](https://www.youtube.com/watch?v=hIJeqD3Ax40)
[2] [https://www.autotrader.com/best-cars/7-best-semi-
autonomous-...](https://www.autotrader.com/best-cars/7-best-semi-autonomous-
systems-available-right-now-271865)

~~~
mips_avatar
I really don’t know that much about Mercedes. I know more about BMW because
they published some info about their autosar implementation. There’s a lot of
technical debt, that I think most automakers need to pay back before they go
fully autonomous. They can’t just do what they have always done and just add
an Autonomy ECU, connectivity ECU, and a EV ECU. And even if they could, they
realize they are going to give too much value to their suppliers if they did.

------
musicale
No, German automakers will kill the German Car.

------
chipotle_coyote
When I just read the headline linked here on HN, I confess I immediately
thought of Betteridge's Law ("Any headline that ends in a question mark can be
answered by the word 'no'"). But of course, that's not fair, so I _did_ click
through to the scanned article and gave it a quick read.

No.

------
noipv4
When Porsche labels a battery operated car as 'Turbo', I think it's time for
them to to die.

~~~
modulos
ASUS makes 'Turbo' graphics cards.

Vitamix and Robot Coupe both make 'Turbo' blenders.

Intel offers 'Turbo Boost' CPUs.

Miele makes a 'Turbo' vacuum cleaners.

Intuit makes a 'Turbo' tax preparation product.

Porsche buyers know that 'Turbo' means 'it's the fast, non-track variant', and
normal people also know it means 'this one is fast'. A few nerdy pedants will
get upset, but literally nobody cares about them. They weren't going to buy
one anyway.

~~~
nomel
> Porsche buyers know that 'Turbo' means

As a car guy, I strongly disagree. In the car world, nearly without exception,
including all previously Porches, "Turbo" is a label indicating that a
specific piece of hardware is installed on the ICE: a turbocharger.

This is like putting a "manual" or "automatic" label on an electric. Sure, you
could probably consider an electric a manual 1 speed or automatic 1 speed, but
it's not going to get anything but marketing BS eye rolls from anyone that
knows about cars.

~~~
detaro
It feels like more a branding term with ICE Porsche too ever since they've
started putting turbochargers on the non-Turbo-branded versions too.

~~~
nomel
Fair enough, but you won't find a "Turbo" labelled ICE, Porsche or anything
else, without an actual turbocharger.

