No Contradiction Here

No more than anywhere else in Germany, I mean.

Contradiction

Everything contradicts itself here. Otherwise they wouldn’t call this place Germany. It’s einfach kompliziert (simply complicated) in this country. Germans don’t like or want electric cars, for example, but are obsessed with “saving the climate.”

With the contradiction between Germans’ climate anxiety and their love of huge SUVs, it’s no surprise that carmakers are struggling – Amid trade wars and plunging China sales, the number of cars rolling off Germany’s production lines has dropped by 12% this year and exports by 14%. European auto sales fell 3% in the first eight months of 2019. 1 With demand expected to remain weak for a couple of years, the German parts supplier Continental AG isn’t ruling out cuts to working hours and jobs.

Meanwhile… Riding a bike and car-sharing have become a genuine alternative in cities such as Berlin.

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And What’s The Problem With That?

German-U.S. Ties Are Breaking Down – Never since the founding of postwar Germany have relations between Berlin and the United States been as fragile as they are today. There is virtual radio silence between Chancellor Angela Merkel and President Donald Trump and U.S. Ambassador Richard Grenell is doing more to agitate the situation than to mediate.

Germany

It’s quite easy to explain, really: “I’m making them pay their bills” and the Germans don’t want to pay these bills. They’ve never paid them in the past, they’re thinking, so why should we pay them now? If there’s anything else I can do to straighten any of this up for you here, just ask.

“There is no understanding, but there are also no misunderstandings.”

“Crotchety, Over-Critical Culture” Part II

As reported earlier, Germans themselves will be the first to admit that, when it comes to entrepreneurship, they have a “crotchety, over-critical culture, with its fear and condemnation of failure,” but it is what it is and they are what they are.

Cars

There’s even a saying/joke here that goes “anything in Germany that is not expressly permitted is forbidden.” Take electric cars, for example. Their production may not be expressly forbidden but the German automobile industry is doing its damnedest to pretend like they don’t exist. One could say this has more to do with “never touch a running system” (this industry still makes piles of money) but it really gets down to being crotchety again. They’re missing the boat and they know it.

Concern is rising in Europe’s automobile heartland about the economic impact of the industry’s move to electric vehicles from gasoline-powered cars.

Officials and executives in Germany fear the country’s big car companies and rich ecosystem of suppliers and service providers are insufficiently prepared for the transition, and that their leadership may not be assured in an electric-car world, threatening jobs, tax revenue and even growth.

Assembling electric cars isn’t as complex or labor intensive as making traditional vehicles and relies partly on imported technology. At the same time, China has made rapid forays in electrification and is shaping up as a potentially formidable competitor in the field.

The trepidation is particularly acute in the city of Stuttgart, hub to one of the country’s biggest automotive clusters at the heart of the nation’s dynamic south. It comes as Europe’s largest economy is showing signs of weakness amid a chill in global trade.

“The greatest catastrophe would be if the industry fell asleep at the wheel. It is crucial for jobs that companies like Daimler make a massive push into this technology and build locally.”

German Of The Day: Handelskrieg

That means trade war.

Handelskrieg

A trade war between the United States and Europe is coming and the fallout could tip Germany into recession, according to analysts at German lender Commerzbank…

Official German statistics supplemented by the bank’s own research show that in 2018, the United States was the top export destination for German cars, accounting for about 12% of the total with a value of 27 billion euros of parts or finished vehicles.

The bank estimated that a Trump-ordered tariff increase of 25 percentage points on EU auto imports would slash that figure for Germany down to around 14 billion euros per annum.

When factoring in how much of that export figure is actual German “added value,” the bank estimated that total economic output for the country could fall by around 0.25 percentage points.

“All the more dangerous in a situation where the German economy is only just managing to avoid a recession,” it read.

Political Paralysis?

That’s my thing now. That’s what I do.

Merkel

On the one hand, I could screw it up with this side. On the other hand, I could screw this up over here first. Decisions, decisions…

The global order that underpins German prosperity is unraveling, and Angela Merkel doesn’t know what to do. President Donald Trump’s America First policy is forcing Germany to make an impossible choice between the U.S. and China — pitting the force behind the country’s modern economic success against the key to its future growth…

For decades, the country profited from an international trading system run by the West and backed up by the military might of the U.S. The government just got out of the way and watched exports roll. Those days are over…

“Germany is caught up in a dilemma of changing trade patterns and doesn’t know how to react.”

Trump hin oder her – die USA bleiben Deutschlands wichtigster Absatzmarkt.

Are You Feeling The Security Risk Yet?

European automobile tariff regulators?

Import

The U.S. Commerce Department is set to meet a Sunday deadline to deliver its recommendations to President Donald Trump on whether imported vehicles and parts pose a national security risk, and to outline options on how to address the issue, officials said on Thursday.

Trump would then have 90 days after Commerce’s recommendation to decide whether to impose tariffs…

Trump has urged the EU to drop its 10 percent tariff on imported vehicles. The U.S. passenger car tariff is 2.5 percent, while it imposes 25 percent tariffs on pickup trucks.

The Alliance of Automobile Manufacturers, whose members include General Motors, Volkswagen AG, Toyota Motor Corp, has warned tariffs would boost imported car prices nearly $6,000 on average.

Deutsche Autobauer verstehen die Welt nicht mehr.

German Of The Day: Tempolimit

That means speed limit.

Speed Limit

Odd, yesterday we dealt with getting caught in traffic jams in a country that doesn’t have any speed limits (on parts of the Autobahn) and now it’s time to introduce such speed limits in the same country? At least that’s what the commission National Platform for the Future of Mobility is proposing, whatever that is. Look, these drivers aren’t going anywhere now as it is. How will reducing their speed get them nowhere any safer? Oh, it’s about CO2 again. I should have known.

Limit the maximum speed on the German Autobahn to 130 km/h? This could lead to another revolution, folks. And it probably won’t be a bloodless one this time.

Kommission ist sich der Brisanz bewusst – Noch ist es nur ein Entwurf, doch die Ideen der Kommission “Nationale Plattform Zukunft der Mobilität” haben es in sich. Sie sollen den CO2-Ausstoß bis 2030 um die Hälfte senken.

But This Isn’t Supposed To Happen

Germans don’t like electric cars. So nobody else is supposed to like them, either.

Tesla

The customers are supposed to buy, you know, German diesel automobiles, for instance.

And now this. Tesla was dead. Everybody read about it. At least over here in Germany, they did. Again and again. And they liked what they read, too. But now, Tesla’s Model 3 appears to be a big hit in US-Amerika. And Tesla’s moving on to China. And this wasn’t supposed to happen. This is very upsetting for the German automobile industry. Very upsetting indeed. Now German automobile industrialists are on the defensive and will have to play catch-up and start pushing electric car production even harder even though they’re already printing mountains of money with their old technology now and why the hell would anybody want to buy a freakin’ stupid electric car like that anyway?

TESLA-BOSS SCHOCKIERT DIE KONKURRENZ MIT REKORD – Krisenkarre Model 3 plötzlich Bestseller.

Car No Longer Manufactured Since 2003 Will No Longer Be Manufactured Again Next Year

Feature

The compact Beetle was introduced in Germany in 1938 during the Nazi era before becoming a symbol of Germany’s rebirth as a democratic, industrial powerhouse after the second World War.

It came to the US 11 years later, where it became a symbol of utilitarian transport for the postwar baby boom generation – often used by hippies.

The famous car sold for about 30 years before US sales stopped in 1979, through production continued continued production for Mexico and Latin America. The last of the original bugs was produced in Puebla, Mexico, in 2003.

VW Käfer wird bereits seit 2003 nicht mehr hergestellt.

Robust Export Growth?

German exports rebounded in May, providing more evidence of a strengthening of the economy in the second quarter.

Export

Yeah, I guess that’s true. If you forget the exports last month to one particular country. Those have dropped 10% for some inexplicable reason. But I’m sure that will pick up again real soon, right?

Despite ongoing trade tensions, German exports did what they normally do: grow. In May exports increased by 1.8% MoM, from -0.3% in April. At the same time, imports increased by 0.7% MoM, from 2.6% MoM in April. As a result, the trade surplus narrowed somewhat, from EUR20.1bn to EUR19.7bn.

“Die Verunsicherung durch die Einführung von Importzöllen seitens der USA und die Gegenmaßnahmen der EU und Chinas machen sich direkt bei den Unternehmen bemerkbar.”