
China is crushing Europe's electric car dreams - malshe
https://www.cnn.com/2018/10/30/business/europe-lithium-electric-batteries/index.html
======
mtgx
The biggest irony in all of this is that the European carmakers have lobbied
and continue to lobby the EU _against_ too strict of a mandate for EVs or too
large subsidies for EVs, while also lobbying against stricter emissions
controls (which indirectly means they don't have to build as many EVs for
their fleets either).

Meanwhile, the same European automakers seem very willing to adopt China's
super-strict schedule for EV adoption over the next few years in the country.

The European auto-makers should count their lucky stars that on one hand Tesla
is pushing them to go into EVs from the consumer side, and on the other China
is doing the same through those strict regulations I mentioned.

Without these two, the European carmakers would have probably gone bankrupt
one by one (or purchased by multi-billion dollar Chinese companies in the
future). At least now they have a role in the future of cars. But losing their
_leadership_ in car-making is pretty much guaranteed already. They just don't
know it yet.

~~~
maxxxxx
I grew up near Mercedes and Porsche in Germany and from what I remember they
were always very reactive. Every time something like catalytic filters, safety
belts or emission standard became mandated they always fought and claimed the
world would go under. And soon after they adopted these things and did really
well.

~~~
petre
They're just buying more time. German automakers are quite risk-averse but
usually they have the details sorted out before they go to market. Porsche
already has hybrid cars and they're working on the Taycan. Audi has the e-tron
in production. Daimler has the EQ concept which will go into production by
2022. What they don't have yet is the charging infrastructure. It should be
standardised amongst all German automakers if they're smart.

------
Bayart
I've never quite understood why our industry heavy weights didn't push heavily
into battery technology. It seems fairly obvious energetic density is a big
bottleneck in a number of industries. I'm under the impression all the
attention went into theoretical research and patenting schemes, but nothing
into actual production processes.

In that respect, I'm quite thankful to Tesla for pushing the envelop with
Panasonic.

~~~
candiodari
I think because it's a solved problem, where we can't advance. This has a few
reasons:

1) All the obvious avenues (like simple battery chemistry) are explored and
provide no obvious avenues for success

So you can't reasonably expect to advance here. Otoh, we could just stumble on
a huge advance.

2) it is perfectly well known how to make ridiculous capacity, light
batteries. There's even 2 known ways:

* chemical energy storage

* magnetic/electrical energy storage

In both cases it's solved ... only in the theoretical sense. If we have a way
to arrange individual atoms on a large scale (or even 100nm portions of
material) and fuse them, we would be able to make awesome batteries. But we
don't know how to do this.

So this is now a manufacturing problem where you just won't get anywhere
without incredible amounts of knowledge and fundamental advances.

3) What Elon Musk is doing is standardizing existing battery technology and
making it widely available.

On the plus side, we need this. The standard batteries from decades ago can be
improved electrically (e.g. fast charging by actually having 10000 batteries
instead of one big one and charging all of them, which also enables fast
discharging by discharging a lot of batteries at the same time, or even
charging and discharging at the same time). An electrically complex, but well
understood problem.

On the downside, this doesn't actually solve any issues we have with
batteries. They're a little too big, a LOT too heavy. Elon Musk's batteries
... are a little too big, and a LOT too heavy.

~~~
pso
> it's solved ... If we have a way to arrange individual atoms on a large
> scale (or even 100nm portions of material) and fuse them...

What exactly do you mean by this? Fuse them in what sense? What advantages
would there be at a smaller scale?

~~~
candiodari
I mean we can come up with designs that we know will have battery capacities
10x or 1000x even of current battery capacities.

But we can't build those designs.

------
mhandley
As I see it, in a few years time the market for batteries for electic cars
will be a little like the market for DRAM or Flash today. The upfront costs to
be able to produce competitively at volume are very high, and although the
market is large, there will be just enough competition and cells will be
commodity enough that profit margins will be both slim and volatile. I'd much
rather be in the business of making cars to use those batteries, where there's
potential to differentiate your product with good design (like say, Apple in
computers and phones) than in the business of making batteries.

~~~
raphaelj
While this kind of commodity products might not make huge profits, it might
still be a huge provider of low to mid class jobs.

~~~
marak830
Or, more likely I'm home, a huge provider for robotics line production
suppliers

------
Latteland
This article is irritatingly wrong in the numbers it gives. It says tesla will
make 100k cars in the us and 500k in china. Tesla is already producing at the
rate of 300k cars in the us, and it's increasing (200k m3, 100k s&x). The US
battery factory isn't even at full size. This article says telsa is producing
more batteries than all the rest of the world together - [0].

I'm sure the rest of the world can catch up and pass Tesla in battery
production - but they have to try. According to info available from recent
articles (see above), Tesla does have half battery production at least.
There's nothing that stops Tesla from making more factories, or anyone else.
They just have to spend the money to get started. The weakest auto company was
able to do this (weakest in finances), so other ones can do it too if they
want to. They don't want to because auto companies would lose all their
expertise in drivetrains if they switch to evs. They are being reluctantly
drug into it. see [1].

I do agree with the basic idea that the European automobile companies will get
decimated in about 10 years unless they react to this. Also Tesla plans
massive new investments in batteries - [2]. (that includes the new China
factory but also giga factory #2 and 3).

0 - [https://electrek.co/2018/08/02/tesla-
gigafactory-1-battery-p...](https://electrek.co/2018/08/02/tesla-
gigafactory-1-battery-production-20-gwh/).

1 - [https://cleantechnica.com/2018/09/25/tesla-an-
uncomfortable-...](https://cleantechnica.com/2018/09/25/tesla-an-
uncomfortable-wake-up-call-for-germany-all-hands-on-deck/)

2 - [https://electrek.co/2018/11/02/tesla-multi-billion-
investmen...](https://electrek.co/2018/11/02/tesla-multi-billion-investments-
gigafactories/)

------
beerlord
Don't forget, these are the same automakers that faked their diesel results
for years - poisoning (their own) cities with noxious fumes. Its fair to say
that the environment is not high on their agenda.

Instead, its simply that ICE cars offer higher barriers to entry, and higher
revenue. Higher barriers to entry since the engines and fuel systems are
incredibly complex, and higher revenue since they need more repairs and spare
parts.

EVs by contrast are much simpler, and will encourage the commodification of
vehicle transport - look at what is happening in China with 'Low Speed
Electric Vehicles'.

Its kind of a shame that countries like Poland havn't launched their own low-
cost EV companies, to take over the low-end of the European market. But its
unsurprising as Europe, even the East, is indeed very bureaucratic and
unaccommodating to startups. The continent would help itself massively if all
countries adopted English as an official second language.

~~~
petre
You still need to replace the battery pack, sell the car at a hefty discount
with a degraded pack or pay for a new and expensive pack replacement. Don't
worry, the barrier of entry into EV is still high. The complexity moves from
the mecahanical side into the battery cooling and adaptive charge/discharge
strategy, adaptive software for drive assist and instead of the spare parts
costs you've got a hefty battery replacement cost that's like 20-30% or a new
car. Plus less competition from used cars, since they come with degraded
batteries.

------
dcgudeman
"Chairman Kees Koolen told CNN that Lithium Werks was investing in China
because the infrastructure is better and it's easier to get the permits needed
to build a factory. The company said it was put off by the amount of red tape
needed to invest in Europe."

I don't really see a path to Europe becoming relevant in emerging technologies
with comments like this from what few companies they do have.

~~~
ASalazarMX
Is that a problem of the EU or China? Things become cheaper when you don't
care about the wellbeing of your citizens.

------
shmerl
_> Building electric cars in China makes sense for companies because that's
where most customers are_

Why are there less customers in Europe or US?

~~~
woodandsteel
Because the Chinese government is pushing electric vehicles very hard. It is
doing this for several reasons

1) to counter global climate change

2) to reduce local pollution

3) to reduce dependency on foreign oil

4) to establish global dominance in batteries and vehicles.

From what I have read, the experts expect that falling battery prices will
lead to electric cars costing about as much as ICE ones by around 2025, and
this will lead to EV sales skyrocketing and ICE sales plummeting. All the
traditional manufacturers will be in deep trouble then except the ones that
had decided a number of years before to focus on switching over to electrics.
Unfortunately in the US the President is deeply committed to fossil fuels
forever.

~~~
imtringued
Is this some kind of joke?

ICE manufacturers produce ICEs because they are cheaper than EVs and that's
where the market is at right now. You can't expect the average buyer of a
vehicle to pay $15k - $20k more (depending on the model this is a 100%+
markup) just because it is electric. This is a problem that solves itself
automatically by simply waiting for cheaper batteries which is the strategy
ICE companies are following right now. Almost every ICE company already
produces EVs but the price makes them completely uncompetitive compared to
ICEs except as a luxury product.

Just look at the statistics...

When VW released the e-Golf 3 years ago it outsold Tesla in Norway [0] by a
factor of 2x but nobody is making news about it today because it's not as
trendy as a $100k Tesla or $50k Model 3, it's just a damn expensive golf and
it will stay that way until battery prices come down.

[0] "Sent i går kveld offentliggjorde Opplysningsrådet for veitrafikken (OFV)
registreringstallene. De viser at det ble nysolgt 25.779 elektriske
personbiler i Norge i 2015. De tre bestselgerne delte 62 prosent av markedet:
Volkswagen e-Golf (8.943), Tesla Model S (4.039) og Nissan LEAF (3.189)." [0]

[https://web.archive.org/web/20160206212025/http://www.elbil....](https://web.archive.org/web/20160206212025/http://www.elbil.no/nyheter/elbiler/3698-nesten-26-000-nye-
elbiler-i-fjor)

~~~
woodandsteel
>ICE manufacturers produce ICEs because they are cheaper than EVs and that's
where the market is at right now.

That's correct. But as I said, battery prices are falling and so around 2025
they won't be more expensive.

>This is a problem that solves itself automatically by simply waiting for
cheaper batteries which is the strategy ICE companies are following right now.

The problem with that strategy is that an auto company can't just one day
switch over from almost all ICE's to majority EV's. It takes at least half a
decade to do so, so a company needs to be working very hard on the change-over
before it comes.

One example is batteries. If VW should want in 2025 to switch over, it
couldn't do so because there would not be remotely enough batteries being
produced, and building new battery factories will take many years. So what VW
and every other ICE manufacturer needs to be doing right now is investing
billions in battery factories.

However they just are not doing that, or many of the other things needed to
get ready, and so when the time comes they are going to get totally clobbered
by Chinese manufacturers who have been ramping up EV production at a very
rapid rate, and Tesla.

And the reason the Chinese companies are rapidly expanding EV production is
the government is pushing them so hard. But in Europe, not to mention the US,
the governments are mistakenly assuming that it is going to be ICE's forever,
or at least that the EV revolution will be two or three decades from now.

------
noetic_techy
So Volkswagen is about to be the Nokia of the car industry.

------
Theodores
There is another short term problem that has to be resolved before we get to
EV cars in Europe. The E.U. car market is in a bit of a holding pattern due to
Brexit. This is cramping the style of the European manufacturers even if they
have no components coming from little Britain, no manufacturing plant there
and no customers there. You would think companies like FCA (Fiat) or Mercedes
would be exempt but they are not.

I am an evangelist when it comes to EV cars however I don't think that
everyone is so keen, particularly in the cynical UK. Relatively speaking
Americans are falling over themselves to buy Tesla cars, Tesla being a great
American success story, even with Elon Musk upsetting people in his own
special way and the prices being so high.

With the European brands there are tells, if VW come out with a new car there
is nobody asking where the EV version is. Same with other makes, that is just
not on most people's radar, exhaust note matters more. I think it is a sad
state of affairs. There are promises that they will be fully electric/hybrid
by such and such a date and then they launch a 'G-Wagen' type behemoth with a
monster ICE engine in it. It is like they are hooked on heroin and promise
they will give up next week.

China is showing leadership and it is about their domestic market and having
cleaner cities. You can't get permits to drive an ICE car into some cities
now, unless you live there and already have an ICE car then your only option
is EV. That is fantastic. The Chinese know that they really will be conquering
the world with their EV cars. We may mock their cars as not being crash worthy
and rip-offs of European designs but we said that about the Japanese and their
sub-compact cars. And the Koreans. It is not rocket science, just poach the
design team from another company and get styling from an Italian specialist -
Italdesign, Pininfarina, there are plenty of good ones.

The Chinese cars I am looking forward to seeing are the basic electric cars.
When you have a quiet car with no gearbox or vibrations there is no need to
make up for having an ICE with cupholders galore, speakers galore, carpets
galore and other cruft. People in China have cottoned on to this already
through buying second cars - EV cars - to enter the city with. They find that
they don't really need that 'luxury' car after all.

Once these things enter the EU market the European marques will be doomed,
maybe with a few exceptions. The Nissan Leaf/Renault Zoe is a product that is
going somewhere but consumers are not that interested apart from evangelists.
I also doubt that the insistence on 500 km range will be lasting forever -
range anxiety. In China you can have 50 mile range and with a supercapacitor
that can be achieved with far less batteries. Anything further just hop on a
plane. Can't do this in Europe where it takes four hours to get in and out the
airport.

The European makes and the European customers had their chance and they blew
it. Tough. I look forward to the 5 year plan of China and a flood of Chinese
EV Volvos coming over to Europe to be totally taken up by millenials with
kids, leaving fuddy duddy ICE addicts to grow old and die off.

~~~
benj111
"little Britain, no manufacturing plant there and no customers there"

The UK is a large market for German cars.
[https://www.acea.be/statistics/article/motor-vehicle-
trade-b...](https://www.acea.be/statistics/article/motor-vehicle-trade-
between-the-uk-and-main-eu-partners)

This one says 20% of the market
[https://www.express.co.uk/finance/city/906047/German-car-
fir...](https://www.express.co.uk/finance/city/906047/German-car-firms-brexit-
chaos-Merkel-mercedes-BMW)

Also I'm not sure what you class as German manufacturers but Vauxhall/Opel
have a factory in Ellesmere port building Astras (Opel and Vauxhall), and Opel
is a German brand. Alternatively Minis are made I Cowley and owned by BMW. I
assume RR and Bentley are still in the UK also and they too are owned by
German companies.

As to parts suppliers. I cant point to any one supplier that supplys German
car companies but I cant believe there aren't any.

~~~
Theodores
I just saw the street outside and all the cars are German, although there is a
Renault Zoe looking good without the tailpipe - had to check that. But yes,
you are right, German cars are what everyone wants to buy in the UK.

Opel and Vauxhall were owned by GM until a year ago, they are now owned by
Peugeot/Citroen - 'PSA group'. When the Astra gets to the end of its life
expect Ellesmere Port to close. Regarding Luton there will be vans made there
on the PSA platform, this will be badge engineering with the same vans having
many different inprints, possibly for other non PSA brands as that already
goes on a lot in the sector.

PSA also bought Chrysler Europe many aeons ago and only kept the Ryton plant
going in the UK, the Peugeot 309 was supposed to by a Chrysler originally.
That really was decades ago and it kind of vanished, much like how GM/Ford
dropped a few brands after 2008, closing production here and there.

Bentley do have some British badge on them but they make the Bentayga
alongside the Porsche and Audi SUVs somewhere in the Czech Republic or
Slovakia, I would have to fact check there, but you get the idea. They might
send them off to England to have the badges slapped on but the point is that
it is an integrated supply chain.

Rolls Royce have invested in plant in the UK but that again is part of a
complicated supply network, the engine is German in a Rolls, originally - a
century ago - Rolls did the engine and chassis, you were having to shop
elsewhere for the 'coachwork', in 2018 they do just the 'coachwork'. Rolls
Royce is ultimately a halo brand, bespoke but very much made possible by BMW 7
series type of platforms.

MINI production is in the UK however there is also a lot of MINI cars made by
Magna in Austria (the MINI Clubman things) as well as in the former DAF
factory in the Netherlands. MINI are well placed to shut up shop completely,
for good in the UK. Notionally they are changing the UK production facilities
for the EV models promised.

Getting back to Vauxhall, they were not just Opel with a different badge, in
the days before the common market GM had lots of different subsidiaries with
their own design and engineering. Same with Ford, British Fords were different
to German Fords.

In that era there was a cross licensing deal with components so Lucas/Girling
in the UK did not compete in the same markets as Bosch in Germany. With things
like disc brakes, lighting and much else that was how it worked, Lucas could
make the whole range for the UK and Bosch could for their markets, sharing
patents and IP. Lucas got merged, acquired, split up and sold, so some bits of
it are owned by companies in Germany like ZF. These companies know no borders
though.

~~~
benj111
On some levels you appear to know more about this than me. For example I
didn't know "When the Astra gets to the end of its life expect Ellesmere Port
to close." But then when I check up all I can find is a threat from March
which isn't quite so definitive. And theres no mention on wikipedia either, so
do you have a better source?
[https://www.bbc.com/news/business-43300201](https://www.bbc.com/news/business-43300201)
[https://en.m.wikipedia.org/wiki/Vauxhall_Ellesmere_Port](https://en.m.wikipedia.org/wiki/Vauxhall_Ellesmere_Port)

~~~
Theodores
It is a loss making concern. Hence offloaded to PSA. There is over-capacity in
the market, too many cars, not enough buyers. Life is on hold due to Brexit
plus there are unions, politicians and the media to manage.

They have cut the shifts from two to one, let go of a few hundred workers, so,
as of now it is half closed already.

There is another Opel plant in Poland making the Astra, the Astra being the
only model they make there. The next Astra model comes along in 2020, which is
two years away. There is no money on the table from the UK government to make
this happen.

The plant in Poland is brand new, Ellesmere Port is vintage. Wages are cheaper
in Poland, Poland will also have better access to the EU market if Brexit
happens. Brexit is happening unless there is some fluke event that obliterates
parliament and miraculously restores sanity.

The engines, transmission and much else that lurks beneath the Astra all comes
from Europe, none of that is made in the UK. In Poland these important sub-
assemblies can come from over the border in Germany, no post-Brexit WTO
tariffs needed.

Everyone wants crossovers these days, the Astra as it exists is at the end of
the model life, is not a crossover and limps on in the UK market because it is
notionally British.

Luton is a different story, vans come from there and PSA like their vans.
Right now their main van is a joint venture with Renault, effectively from the
purchase of GM Europe PSA get to where they need to be with vans.

There are dealer networks as well as factories, the former, particularly with
vans, is of interest to PSA.

Renault have ended the joint venture with PSA, they now have a partnership
going with Mercedes. The depths of this I don't know, they share engines and
South America is a big part of the plans.

Here is an earlier story about how Ellesmere Port must 'shape up', note how
the Corsa (made in Spain) already has plans laid out for the new Corsa and
electric Corsa. There is no 'electric Astra' mentioned. The 'electric Astra'
(if it ever exists) won't be designed from scratch for some people in The
Wirral to put together with their existing screwdriver operation, you can
good-as-guarantee it will be an electrified PSA model with a different badge
on it, if at all.

[https://www.autocar.co.uk/car-news/motor-shows-geneva-
motor-...](https://www.autocar.co.uk/car-news/motor-shows-geneva-motor-
show/vauxhalls-ellesmere-port-plant-must-close-cost-gap-survive)

~~~
benj111
Your link just seems to mirror mine, and came out at virtually the same time.
The only mention of job cuts at Ellesmere port that I could find are 400 jobs
last year and sales are down all over Europe so even if shifts were cut I dont
see what your point is.

Look. The first paragraph of your first post claimed German manufacturers sold
no cars in the Uk, didn't manufacture there, and didn't source any parts from
there. That quite obviously isn't true so I challenged it. Your followup
response suggests a factory is going to be closing, when that isn't really
true. If you have a point to make you'll make it much better by not
surrounding it by things that aren't accurate.

~~~
Theodores
You misread me, the brands that are not British are not exempt from Brexit
fallout with that being regardless of whether they sell anything in the UK,
regardless of whether they have components coming from the UK and regardless
of whether they have assembly plants in the UK.

You read into that something else.

Regarding Ellesmere Port, there is no plan for it after the current Astra
model goes. This was decided a long time ago but the deal is to keep it open
until 2020 and the new owners have not renegaded on the deal.

[https://www.bbc.co.uk/news/business-26342093](https://www.bbc.co.uk/news/business-26342093)

It is an old plant and it is as good as gone. There is no point trying to
argue otherwise unless you work there.

~~~
benj111
You're right I did mis read you. I took you to mean there were no German
companies with manufacturing in Britain. And none with any customers.

Re Ellesmere port. We will have to see. Brexit is a massive unknown. But
hopefully wont be by 2020 (ha). But 2020 will probably be an election year so
I'm not sure that the Torys will want the factory closing 'due to Brexit', so
I'm sure some big juicy 'grants' will be offered.

------
forkLding
Although the paper proposes to merge all kinds of EU-based EV and battery
companies together, the issue is still that the European market is 1% of the
global market. EU companies will be likely selling to Asian EV markets for a
long time.

~~~
Bayart
It won't be a big market until there's an actual offering that grows the
market. In Europe gas is very expensive, but electricity is mostly cheap. The
grid is solid. The fundamentals are there.

~~~
pjmlp
Mostly cheap?

Come pay the prices in Southern Europe.

In Portugal gas reigns in households. Most people would never have electricity
based heating or stoves, given the cost spike if they did so.

~~~
Symbiote
Portugal is slightly more expensive than the EU average for electricity.

It's somewhere around average for petrol too, so I don't see Portugal being
much different here.

[https://ec.europa.eu/eurostat/statistics-
explained/index.php...](https://ec.europa.eu/eurostat/statistics-
explained/index.php/Electricity_price_statistics)

