Electromobility: The Self-Sabotage of the Green Party

The strides that the current government has made in terms of its own environmental goals have been everything but impressive. You might even say disappointing:

No thanks to solar subsidies: The Ministry of Economics announced last week that projects related to promoting solar energy have been scrapped. Former VW boss Herbert Diess had advocated for rejuvenating this key green industry. Now, plans to do just that are off the table.

No shift to rail mobility: Railway management and insufficient investment funds are preventing this from happening. The railways are fighting themselves, not the climate crisis.

Germany's dirty energy supply: We are further away from a zero-carbon energy supply than any other Western European country. Reasons include: the shutdown of nuclear power plants, a seven-year delay in expanding power lines and the need to build about 20 power plant units that initially run on gas to prevent blackouts.

Next up, the electromobility sector: The "central modernization project of the current government coalition" (Spiegel) is suffering. Two years ago, the coalition boldly proclaimed, "We will make Germany the leading market for electromobility."

Two years later, the inconvenient truth is that:

• In the first two months of 2024, the share of electric cars in total sales was as low as it was three years ago.

• Additionally, the German Association of the Automotive Industry expects sales to fall by 14 percent this year.

• Overall, less than three percent of the vehicles on German roads in early 2024 will be 100% electric vehicles.

The current government is not solely responsible for this but bears a significant responsibility. This coalition's epitaph could read: Their words were bigger than their actions.

#1 Maximum Uncertainty

Officially, the German government wants to see at least 15 million electric cars on German roads in six years. However, according to the Center of Automotive Management (CAM) forecast, only 7 to 8 million electric vehicles will be on the road by then—about half the target.

Moreover, the so-called environmental bonus to encourage the purchase of electric vehicles has been cut—without a backup plan. This is partly because the expansion of the welfare state, from pension supplements to essential child benefits, always takes precedence. This coalition is green on the outside and red on the inside.

For comparison, 5.5 million people currently receive essential social benefits, more than the populations of Schleswig-Holstein, Mecklenburg-Western Pomerania and Saarland combined. The current budget is €26.5 billion. On average, the environmental bonus was valued by politicians at only about €1.4 billion per year.

#2 A Country Without Charging Stations

Same story, different subject: A program to invest some €200 million in private charging stations, solar panels and energy storage in 2024 alone has also been scrapped. Now, every electric car owner has to fend for himself.

No one expected such a breach of trust from the government. Ironically, they have taken a step backward on their core issue of fighting climate change and electrifying all forms of transportation. The environmental reprioritization of government spending has yet to happen.

#3 The Return to Internal Combustion Engines

Chancellor Scholz cannot ignore: The car industry needs the profits from the sales of combustion engines to manage the decarbonization of its products and factories.

Volkswagen, BMW and Mercedes are interested in reversing the decision to phase out combustion engines in Europe by 2030. They want to improve their balance sheets with depreciated diesel and gasoline technology. As a result, the ambitious e-plans have been watered down in boardrooms and supervisory boards.

At VW, for example, electric car production in Germany is being consolidated; the ID.3 will not be produced at the main plant in Wolfsburg due to insufficient demand.

Mercedes CEO Ola Källenius had declared: “Only electric.” By 2025, he wanted 100% electric cars and plug-in hybrids to account for half of sales. Germany's most famous car brand was finally taking off after his predecessor, Dieter Zetsche (2006-2019), hadn't put a single electric car on the road.

Times have changed: The car boss now only commits to the goal of selling "up to 50 percent" of cars with an electric motor in the second half of the decade. Källenius remains Zetsche's reluctant protégé. Der Spiegel comments:

#4 All-Electric Society Without Adequate Charging Infrastructure

Empty promise: Even with charging infrastructure, the announcements must keep up with reality. By 2030, about 15 million electric cars should be able to charge at about one million charging stations.

The reality: According to the Association of the Automotive Industry, to meet the federal government's ambitious goal, the pace of expansion would have to triple. There are twelve electric cars per public charging station, not including plug-in hybrids.

The Catch-22: The expansion of charging stations is stalled because grid operators are barely keeping up with the installation of the necessary power lines. Charging station operators wait more than a year for network connections.

#5 Project Megalomania

Another reason for the coalition's step back is the misconception that electric mobility is unlikely to prevail worldwide in the foreseeable future.

There are currently 1.4 billion vehicles on the world's roads, 99 percent of which are internal combustion engine vehicles. With an annual production of 90 million cars, the electrification of all forms of transportation remains a mirage.

Why is that? Bosch CEO Stefan Hartung explains:

The problem is that a 100% switch is unlikely. In the megacities of Jakarta, Kolkata, Istanbul, Nairobi, Mombasa, New York, Paris, London, Tokyo and more, the power generation, power grids, charging stations and purchasing power of the people are not sufficient to achieve ambitious goals in a reasonable time frame.

The reality: Bosch CEO Hartung understands how the world works beyond political narratives. He says what no one in the government dares to admit, "Part of mobility will not be electric in the end."

Conclusion: Overambitious goals, unclear priorities and an auto industry with dwindling vitality will lead to the failure of rapid electromobility transformation. In 2023, only about four million cars will be built in Germany, the same as in 1994. Technological leadership has passed to the Chinese (BYD) and Americans (Tesla). This is what industrial decline looks like.

• Former Transport Minister Andreas Scheuer has resigned due to unpopularity.

• Analysts predict a sharp decline in Tesla deliveries in the year's first quarter.

• Is Stefan Raab making his comeback?

Ordered retreat: Former Transportation Minister Andreas Scheuer resigned his seat in the German Parliament (Bundestag) yesterday with immediate effect. He will travel to the USA and Asia but has not announced any further plans. The Christian Social Union (CSU) politician announced:

Easter surprise: According to BILD, the CSU leadership was unaware of Scheuer's plans and Markus Söder was not informed. However, Scheuer announced in January that he would not run again in the next federal election. According to DPA, skeptical voices had been against his potential re-candidacy in the CSU district association of Lower Bavaria.

Long career: Andreas Scheuer has been a member of the Bundestag since 2002, representing the Passau constituency. From 2009 to 2013, he served as state secretary in the Ministry of Transport, and from December 2013 to 2018, he served as CSU secretary-general alongside then-party leader Horst Seehofer. Following the 2018 federal election, he became Federal Minister of Transport in Angela Merkel's fourth cabinet.

Costly minister: The failed car toll project will be remembered most from the CSU politician's career. Scheuer's passion project was stopped by the European Court of Justice in 2019. The federal government had to pay the original operators €243 million in damages.

Conclusion: Andreas Scheuer, 49, is charming, eloquent and a bit shady. In civilian life - beyond politics - the trained political scientist has to show what he's made of. The history books, including those of the CSU, certainly won't have a page reserved for him.

Repression: Israeli Prime Minister Benjamin Netanyahu, backed by a majority of lawmakers in Jerusalem, has legislated the closure of Al Jazeera in Israel. Israel's accusation against the Qatar-based network is that its programmers are not reporting objectively during the Gaza war.

On X, Prime Minister Benjamin Netanyahu proudly announced his achievement:

The Al-Shifa Hospital: According to the Israeli military, tanks have been withdrawn from Al-Shifa Hospital in Gaza. Since the Israeli military's incursion into the Gaza Strip, the hospital has been heavily contested. While the international community criticized the IDF for entering the largest hospital in the Gaza Strip, Israeli authorities suspected it was a Hamas command center.

After the withdrawal, hundreds of residents returned to the site and reported finding bodies and "total destruction."

Death of Iranian generals: Following the suspected Israeli airstrike in Syria, Iran's Revolutionary Guards have confirmed the deaths of two generals from their ranks. The IRGC reported on Monday evening that the two generals Mohammed-Resa Sahedi and Mohammed Hadi Haji Rahimi were killed in the attack on the Iranian embassy in Damascus. Five other members of the Revolutionary Guards were killed in the attack.

Iran's foreign office spokesman Nasser Kanaani strongly condemned the attack and blamed Israel for the death of the generals:

Death of foreign aid workers: According to Palestinian media reports, five employees of the aid organization World Central Kitchen have been killed in a suspected Israeli airstrike in the Gaza Strip. Four foreign nationals from Poland, Australia, Ireland and the UK and their Palestinian driver were among the victims of the attack on a vehicle south of Dair al-Balah in the center of the sealed-off coastal strip, as reported by Times of Israel. The Israeli army wrote on Telegram that the military was "conducting a thorough investigation at the highest level to understand the circumstances of this tragic incident."

Election Day: Two days ago, Turkey went to the polls for local elections - with a difficult result for incumbent President Recep Tayyip Erdoğan.

Nationwide setback: Overall, the opposition CHP (Republican People's Party) (37.7 percent) won the local elections by a narrow two percent margin over the ruling AKP (Justice and Development Party) (35.5 percent). This is the first time since its founding in 2002 that the Islamic-conservative party had become the second largest force in Turkey. The CHP's defeats in the metropolitan areas of Ankara and Istanbul are particularly significant victories.

"Whoever wins Istanbul wins Turkey”: Erdogan's chosen goal was to reclaim the metropolis of Istanbul in the local elections. Already in 2019, Ekrem İmamoğlu of the opposition CHP won Istanbul. This year, nothing has changed. With a lead of more than ten percent, İmamoğlu (51 percent) prevailed over AKP candidate Murat Kurum (39.6 percent) - a significant loss for the AKP and the president.

Rebuke: The election results are probably a clear expression of the population's dissatisfaction with Erdogan. With an inflation rate of around 67 percent, this comes as no surprise.

Expectations lowered: Analysts expect a significant drop in Tesla deliveries for the year's first quarter. This week, the car maker will release its sales figures for January-March.

Growth expected to stall: On average, analysts surveyed by Bloomberg estimate that Tesla delivered 453,964 vehicles in the quarter. That would represent a more than six percent decline from the previous quarter.

Focus on Wall Street: The key will be whether Tesla can report year-over-year growth - it delivered 422,875 cars in the first quarter of 2023. Some analysts expect a decline here as well. If so, it would be the first year-over-year decline in deliveries since the second quarter of 2020.

Challenges in China: Competition in the People's Republic is fierce, with BYD recently surpassing Tesla as the most prominent electric car maker. Wedbush Securities analyst Dan Ives notes that "increasing competition and ongoing price wars" have made China "a significant challenge" for Tesla.

Under pressure: Tesla and Elon Musk must regain Wall Street's confidence. Wells Fargo has already called the company a "growth company with no growth."

The stock is down 29 percent since the beginning of the year.

Tuesday:

• The Federal Statistical Office announces the inflation rate for March.

Wednesday:

• The NATO foreign ministers meet in Brussels. The two-day meeting will focus on further support for Ukraine, preparations for the NATO summit in July and celebrations to mark the 75th anniversary of the alliance.

• The Statistical Office of the European Union publishes consumer prices for the previous month.

• Nokia and Walt Disney hold their annual general meetings.

Thursday:

• NATO turns 75 years old.

Friday:

• The Federal Statistical Office in Wiesbaden provides information on incoming orders in various industries for February.

He is back: Stefan Raab may be coming out of his entertainment retirement and returning to the big screen, at least if we can trust the video he posted on Instagram yesterday. Let's remember: yesterday was April 1st, and Stefan Raab has a reputation as a prankster to uphold.

Going viral: Raab posted a video on Instagram with his TV colleague Elton four days ago. In the video, Raab can be seen fishing from behind in a mountainous landscape. When Elton tries to convince him to make a comeback, Raab says,

Record numbers: After three days, more than 60 million people had watched the video. But watching doesn't necessarily mean following, so at the end of the self-imposed three-day deadline, the account only had about 3 million followers.

No cause for alarm: Even though the goal wasn't reached, Raab announced in a second video—in the same setting—that he would be making his TV comeback in September. It will be in the boxing ring. His opponent is Regina Halmich, the undefeated lightweight world champion from 1995 to 2007.

Unsettled score: Raab has already faced Halmich twice, and both times, the fight ended in defeat. Now, it's time for a rematch—on September 14, 2024. It may not be very original, but it's certainly a worthy comeback!

Wishing you a wonderful start to your day. Stay informed. Stay with me.

Best wishes,