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The chancellor, the federal minister and industry representatives advise on how the German auto industry can be helped to emerge from the crisis. A particularly controversial move shouldn’t come at the moment.
The ailing auto industry can look forward to additional help for structural change. However, it is not about taking direct action against the acute sales crisis, such as expanding purchase premiums to include modern gasoline and diesel cars, but about strengthening the equity of suppliers in particular.
A working group will examine whether, and how, a “market economy concept” could be developed at the next high-level meeting in November. That comes from an outcome document from the “car summit” on Tuesday night. It was available for the dpa news agency. State purchase premiums for cars with modern internal combustion engines are not mentioned in the results document.
Suppliers under pressure
Suppliers in particular have come under pressure from the Corona crisis. On the other hand, according to the document, it is convenient to examine what other aspects should be taken into account in the “future investments” in the industry provided for in the federal government’s economic stimulus package.
The top round also agreed to advance digital transformation around cars and autonomous driving. The charging network for electric cars should be more accessible to customers.
Chancellor Angela Merkel (CDU), federal ministers and representatives of automobile manufacturers and unions, as well as prime ministers of “automobile” countries, participated in a video conference that evening.
In June, the coalition decided on an additional program totaling two billion euros for future investments by vehicle manufacturers and the supplier industry. This is intended to promote investments in new technologies, for example. The Ministry of Economy is currently working on implementation.
CSU Purchase Bonus Lawsuits
IG Metall, Greens and SPD had campaigned for a state investment fund to help midsize companies in the auto industry. Many midsize suppliers are still attached to the combustion engine, but they have to invest a lot of money in structural changes. The CSU had renewed demands for combustion engine purchase premiums to stimulate declining demand during the Corona crisis. Modern gasoline and diesel cars could reduce CO2 emissions and help the industry emerge from the crisis. Cars with internal combustion engines are currently being produced in “arsenals”, Transport Minister Andreas Scheuer (CSU) said on Tuesday in Deutschlandfunk: “They have to leave the farm.”
Scheuer warned of massive unemployment in the auto industry with hundreds of thousands of employees. Bavarian Prime Minister and CSU leader Markus Söder said that many had not yet understood the seriousness of the situation. A large part of the wealth in Bavaria and Germany depends on the automobile.
Merkel had already dampened expectations before the conference. She made it clear that she is not assuming there will be a quick decision on more help for the auto industry.
SPD tip resistance
In June, the automotive industry – and with it the heads of governments of the “automobile countries” Bavaria, Lower Saxony and Baden-Württemberg – demanded state bonuses for the purchase of combustion engines in the debate on an economic stimulus package. But that had failed due to resistance, especially from the SPD leadership.
Instead, the black-red coalition decided to cut VAT and significantly higher government premiums for the purchase of electric cars. New registrations of electric cars have increased significantly recently, but are still at a low level. Manufacturers continue to do most of their business selling gasoline and diesel cars. But its sales figures are falling. In addition, there are long delivery times for electric cars.
The German auto industry faces significant economic and structural challenges, according to the auto summit outcome document. For Germany to remain a “leading global and open-technology location” for the automotive industry, the challenges now need to be addressed more intensively: new drive technologies, digitization, good jobs and climate protection are named.
Regular operation for autonomous driving planned from 2022
Germany should take a leading role in autonomous driving. With the autonomous driving law currently being prepared, Germany wants to be the first country in the world to allow autonomous vehicles in regular operation as well as in the entire national scope of application. The goal is for vehicles with autonomous driving functions to go into regular operation by 2022.
In addition, a “mobility data room” will be created. The auto industry wants mobility data to be available “within the scope of freedom of contract.”
By establishing a charging network for electric cars, the ministers of economy and transport must meet “without delay” with the energy industry for a second high-level meeting. Specific agreements must be reached on a uniform payment system and a use of the charging stations that facilitates the customer. Associations like ADAC complain that very different pricing models have been used at public charging stations.
“Development of new value-added clusters”
The vice chairman of the SPD parliamentary group, Sören Bartol, said that the electronic premium was working. But for it to work, more charging stations are needed and expansion takes too long. “We will be attentive to the evolution of the suppliers in the coming weeks. I still think that transformation funds make sense for companies that can realign themselves and for the development of new value-added clusters.”
FDP transportation politician Oliver Luksic criticized that the auto summit did not provide a break for distressed vehicle construction: “The federal government is focusing on the right issues with guidelines for autonomous driving, mobility data and alternative fuels, but more implementation and fewer task forces are needed.
