Imagine a country that takes its climate protection goals seriously. That became rich on oil, yet still aims to ban cars that run on fossil fuels in just six years' time. That country exists. Norwegians aren't crazy. They have a plan.
Germans have been building cars for over a hundred years. Do we have a plan, too? The demise of the combustion engine is near. The world is shifting to an electrified future. It's not an option anymore to say it won't happen. We've crossed the line. It's happening.
The question isn't what type of engine is better or more environmentally friendly. The car industry is in the throes of unprecedented change and Germany risks being left behind. The world's biggest car market, China, is powering an electric vehicle revolution and building the cars it needs itself. Trying to preserve jobs come hell or high water in sectors where I can see that world markets have already moved those sectors in a new direction. It's the worst mistake you can make.
The world has made up its mind. Has Germany, the birthplace of the automobile, a proud car culture. We know how to build a diesel engine. The cars are probably the best in the world. We can also build combustion engines. The question is, does the world still need them?
We're in Bergen. This was once Norway's most polluted intersection. John Marx Plus, the junction of two major transport routes. Now the city's biggest electric vehicle charging station is located here. Do you feel like a pioneer do you feel quite normal? Quite normal, yes. It's much cheaper. I don't have to pay that whole road. I don't have to go to a gas station and it's coming in. Everyone says, well, it doesn't work because it's so complicated in all the way. No, it's not. No, it's not. Will you ever go back to combustion engine car? That's not.
No other country in the world has more electric cars per capita than Norway. 65% of all new cars sold here are electric or hybrid models. The figure's just 7% in Germany. It's not a coincidence. It's political will. Norway wants to be a pioneer. It sees climate protection as an opportunity for its economy, not a threat. It's already world leader in a mission-free technology for ships. Drivers of electric cars enjoy tax exemptions, free or cheaper public parking and the use of bus lanes. Charging stations and parking garages are standard.
I meet up with Christina Buu. Her association represents the interests of Norwegian electric car owners. Her voice counts, not just in Norway. German politicians and industry executives have also sought her advice. This clear direction is for the consumers also a clear sign that this is where we're going and this is the future. I'm really sick of hearing car manufacturers blaming consumers. Saying consumers are not ready. If someone asked me if I wanted a smartphone before it was launched, I wouldn't have understood even. If someone now wanted to take my smartphone away from me, I would have, you know, it's the same with electric mobility. The Norwegian case shows that if prices level, consumers are more than ready to go electric. So don't blame us. Don't blame the consumers. Do the job.
In Oslo, 77% of all new cars sold are electric. Within a year, carbon dioxide emissions have dipped by 9%. Norway didn't invent the battery-powered car. In fact, alternatives to combustion engines have been around for a long time. In 1975, Mercedes rolled out its first emission-free van. 1976 marked the birth of Volkswagen's electric golf. BMW launched its E1 in the early 1990s. We showcased our first electric cars at the 1972 Olympic Games in Munich. They accompanied the marathon run. We now have 20 years of experience under our belt, and I think we've mastered the technology. Give us five, maybe 10 years, then we'll be ready. 27 years later, and we're still not ready.
Germany is nowhere near to reaching its 2020 climate goals, which foresee a million electric vehicles on its roads next year. Instead, we're still debating. Our threshold set in stone is the diesel engine better than its tattered reputation. Our electric cars pollute us in other ways.
The Geneva Motor Show stomping ground of the tradition-conscious car industry. Here, nothing seems out of order. After all, Dymler is unveiling a van. It's electric. Unfortunately, it's not for sale yet. And then it presents the GLE 53, 435 horsepower, 212 grams of CO2 per kilometer. This rounder makes me feel like I can do anything, anywhere, anytime. Thank you very much. Thank you, Danny. Great job. Thank you, guys.
To date, most German electric vehicles have been hybrids. Big, heavy, and above all, expensive. Prices start at 70,000 euros. The premium segment has a, quote, higher price elasticity, which is another way of saying it reaps bigger profits for managers and shareholders. Small, affordable mass market ready, German manufacturers have been slow on the uptake.
Carnation Germany is evidently in no hurry to join the revolution. It's counting on tried and tested technology, on slow change. Stefan Brazel is a seasoned expert on the auto industry. He's growing increasingly concerned. I think German car makers have a 50-50 chance of surviving this world of the world. It could be that Germany is simply a victim of its own success, that on the whole, with its auto manufacturers, industry, and political backing, it was too comfortable to recognize the changes and draw the correct conclusions.
Germany has yet to produce a master plan for coping with the changing automobile industry. Maybe because change is the opposite of what the government and car makers have bonded over. Some 800,000 jobs are directly dependent on the auto industry. Many more are indirectly dependent. Annual turnover, over 400 billion euros. One reason why German politicians have long worked to avert any threat to the car industry, protecting the sector from sudden, disruptive change.
In 2018, the German chancellor addressed an annual gathering of German industry. We cannot alter the climate goals that we've set for ourselves, and to an extent adopted as part of European climate targets as a whole, particularly for 2030. But anything beyond those efforts threatens to drive the auto industry out of Europe. Car makers would produce the cars they sell here somewhere else. I stress that I do not want that to happen.
Is change necessarily a threat? When it comes to the auto industry, the German government seems to think so. We'll use all means to fight restrictions, as in driving bands. Our goal is to avoid driving bands and shape the future of mobility in a way that includes clean combustion engines. Clean combustion engines, a flexible concept in Germany. Driving bands are red flag, threatening to curtail open roads for free citizens. The diesel emissions scandal sowed anger in Germany. The auto industry stalled, then cheated, then covered it up. And then cities imposed driving restrictions.
Waiting for compensation, Germany's yellow vests feel betrayed by corporations and punished by politicians. Automotive freedom, subsidized diesel fuel, commuter allowances, incentives to sweeten life in the suburbs. But now they say, they're footing the bill for mistakes made by industry and government. They're always saying, no, it's not like that. It's not true. Of course they cheated, and VW has to answer for that. But we can't all be punished as a result.
This will have a huge impact on Germany for years to come, affecting the auto industry and its suppliers all the way down to the last mechanic. Germany failed to get in the driver's seat and forge a path for others to follow. It may prove an existential mistake. Because while we Germans are still arguing about past emissions, the rest of the world is already on the road to a new era.
China, the world's biggest and most important market, it's still growing. German car makers helped power mass motorization here and made a lot of money. They command a market share of 23.2% in the combustion engine sector. But just 0.4% in the electric car sector, and that's a problem. No one can beat Germany when it comes to technology for diesel and gasoline engines. It has 130 years of experience. But when it comes to electric vehicles, everyone is taking off from the same starting line. And China is racing ahead.
By 2025, Beijing wants about 25% of cars sold annually to be plug-and-hybrids or battery powered, not least because the country is suffocating in smog. But 25% in China equals the combined total of new cars sold in Germany, France, and Britain. It's a giant piece of the pie. A pie that, if Germany isn't careful, will be divided up among others. China aims to stop selling combustion engine cars in 11 years.
I've arranged to meet a German top manager who spent years at BMW. He helped develop the I-8, a small electric revolution at the time. But then he turned his back on Germany and came to China. He took half his development team with him. What opportunities did Kostin Breitfeld identify here that he didn't see in Germany?
Things happen in China at lightning speed. It's a gigantic market, with 30 million new cars sold each year. There's a ton of capital and investors in China, and the issue has strong government backing. In China, if the government says more electric cars are the goal, then the decision is made to install 50,000 charging stations, and by the next month they're in place.
So normally, the follow-up question in any interview is, does that mean I'm against democracy? And naturally I say, no, I'm not. But if I look at the European democratic structures, then I see how we spend about a decade discussing new ideas. And after a decade, all that's left is 10% of the original idea. So we need to realize that if we maintain that pace of decision-making and realization, we just won't be able to keep abreast of global developments. With the speed of development in the world.
Las Vegas. The annual CES trade show, Spotlight's high-tech innovations from around the world. Before his current venture, Cost and Brightfeld helped build this car for Chinese startup, Biden. German manufacturing expertise, lots of cash, and unlimited government backing. The ingredients China is using to power a head on the market.
The M-Bite is a 40,000-euro electric SUV with a 1 meter 20 screen, a tablet on wheels for video conferences or online shopping to pass the time in traffic jams. It's set for production late 2019. Mercedes is here too, with a glass prototype. The mid-range combustion engine cars on the other hand can be purchased. BMW also has a vision. The eye next. Electric self-driving with a shack carpet. It's not for sale.
I'm meaning another high-profile German who jumped ship. Karl Tomas Neumann was on the Volkswagen board. CEO of Continental, and then Opel. Now he lives in the US, where he's launched a startup. Is this really the dawn of a new era?
The dawn of a new era. And down here we have the biggest SUV that BMW has ever built. Isn't that emblematic of the current situation in the German car industry? Sure, you could say that. It's kind of symbolic of what's going on. It certainly looks more like a dinosaur than futuristic. But the dinosaurs aren't nearing extinction. They're still successful money makers in the twilight of the combustion engine.
Can success hinder progress? Is the German auto industry being held back by its own success? I do think that's a big part of it, yes. It's hard to get up that success and say to some extent, I have to destroy that success to create a new one.
Now you weren't exactly in a bad position at Opel to make a start. Why didn't you? We did try in the end. I would have liked to fully electrify Opel because when the emissions scandal hit, I realized it's not enough to just adhere to the laws. You need to develop a new mindset. And the mindset I would have liked for Opel would have enabled a full switch to electric car production by 2030. Then we could have gone to lawmakers and said, Hey, we need the framework so that this can work. We both need to make sure this happens. Jobs will be lost, but new ones will be created. Electric vehicles will give rise to new business opportunities. But where's this being discussed in Germany or even in Europe?
Maybe we Germans simply can't part with our gas gusslers yet because they're our invention and so slick. Perfect machines with high precision parts that just keep getting better, stronger, heavier. 2.5 tons of German engineering genius. The most complex driving machine in history. An electric car doesn't need all that. Instead of an estimated 2,000 moving parts, it has just 200. Simply beneath our dignity.
Carnation Germany appears comatose. It's as if all the changes have nothing to do with us. Alternative engines, driverless cars, new visions of transport. Why can't we catch up? We're a country of engineers. Perfection took us to the top. And continuity kept us there. A abrupt change is exactly the opposite.
I have an appointment with Ova Kahnat. He chairs a government advisory panel on research and innovation. And he has an explanation for what's gone wrong in Germany. You have to work hard to attain the status of innovation leader. The danger is that once you've made it to the top and there's a reversal, then you get the so-called lock-in effect. The lock-in effect means untrapped inside and can barely see a way out apart from extremely high expenditure.
So in the case of the auto industry, we are now at the top of our game in fossil fuel-powered cars. No one comes close. But stepping out of that comfort zone towards other types of engines is associated with very high costs, conversion costs, transaction costs. And that's called lock-in. That's what we have here in the German auto industry. And that's the challenge. How should policymakers be steering developments?
In processes of deep structural change, the government has a responsibility to secure people's incomes, but not their jobs. No one should get left behind amid such structural change. There needs to be a safety net somewhere. But trying to preserve jobs in sectors where I can see that world markets have already moved those sectors in a new direction is the worst mistake you can make.
It can't have escaped anyone's notice that things are moving in a new direction in this sector. Dieselgate, the emissions crisis, theoretically a good time to be mapping out a transformation plan for policymakers too. More of the same can't be the answer in a world undergoing radical change. We're letting others call the shots.
Why is Germany like a rudderless ship? The German transport minister didn't have time to answer our questions. Instead, we speak to the minister, Stefan Bilga. Our country is closely connected to the automotive industry, so we need to consider the impact that major transformations will have on jobs. For us, this transformation is a process of evolution, not revolution, and we're managing quite well. But isn't it precisely because of that responsibility that we should be driving innovation? We've backed ambitious climate targets.
We've always pursued ambitious goals at the European level, which our automotive industry then has to implement. But there have been times when it seemed there was little political support for the most ambitious climate goals. There are without a doubt proposals within the Europe wide debate that we don't consider productive. In my view, the goal should not be that we decide today, in 2019, what transport will look like in Germany in the years 2025, 2030 or 2050. A lot can develop in the coming years. What if developments go in the wrong direction?
When the car industry does well, Germany does well. This old adage is a cornerstone of government policy. But what happens if the decade's old symbiotic relationship between government and the car industry can no longer provide answers to today's challenges and the climate crisis? Andreas Kanit is one of Germany's leading researchers in the field of transport. If nothing changes, we'll protect the German auto industry to death. We are currently endangering the five, six, seven hundred thousand jobs that we still have, because we're protecting something that has no chance of survival.
What plan should the German government be making to keep us as a nation of car makers competitive? Well, policymakers have had a long-term plan. Please, everybody, drive cars. Cars go with the good life, and even better if everyone buys German cars. German technology with gasoline and diesel engines, both German inventions. That's what we've been pushing. What's the danger? If we continue this policy, then we'll be overtaken, because the world around us is different. People and countries and above all cities elsewhere in the world have long since made the decision to phase out combustion engines and switch to battery-operated cars.
If we don't play along, we'll lose crucial export markets and we'll be sitting on technologies and cars that no one needs anymore. That's a problem. And it's accelerating, while Germany slams on the brakes. Zwickau in the eastern state of Saxony has a long tradition of building cars. VW opened a plant here in 1990. The Gulf has been rolling off its assembly line for years. But its days are numbered. Change is coming, probably also because pioneer sounds better than emissions cheat. Volkswagen needs a new image.
Its vehicles are responsible for 2% of global carbon dioxide emissions. The world's biggest car maker wants to change that. It's now taking climate goals like Paris 2050 seriously, and electric vehicles are the future.
Mikhail Yostt helped devise the plan. He's chief strategist at Volkswagen, a close associate of CEO, Habat Dice. He filled a new position at BW. It never had a strategist before.
What do you call a strategy that propagates diesel cars for decades and then suddenly says the future is electric? For starters, one doesn't rule out the other. We've never said diesel cars have lost their relevance. But in view of the challenges we all face to meet the Paris targets and bring down CO2 levels, VW is a mass market producer really has no other choice.
But are we in Germany reacting fast enough given the speed of developments around the world? Every technological transformation comes with teething problems. Whenever you rebuild something, it takes three days before you get it to run smoothly and another three days before you get used to it. Well, I don't get the feeling this will take three days. Symbolically speaking, it can be dealtlessly sped up. Speed is what the car industry needs now. It's had its foot on the brakes for too long.
VW's mass market electric model, the ID3, will be built in Zwickau. The company is funneling 400 million euros into the facility's conversion. But the switch to electric will make engine builders, exhaust fitters, and field pump experts redundant. So VW is sending them on what it calls a learning journey to prepare for the future. Long-term employees will have new tasks. This is where the specialists are trained in a roleplay room called Emotion.
After a look back at company history, trainees get a vision of the future with virtual reality. We learn the all important components of the ID Neo-Kennem and experience how these are built in special. In the middle of the light, the control of the control unit can begin their life. An experience that everyone at this plant is slated to share.
Based on what you know so far, do you think you're in for a big change? It will be a big change for everyone here. VW is proud of the 17,000 orders for electric vehicles. But that's just the start. The company builds 44,000 vehicles every day. The next challenge is the future. The future is the future.
Change is coming. But what about the German auto industry and government policy? Can we afford to be complacent or worse yet without a plan? China is building its own fleet of electric cars. German engineers are helping. Now German car makers want change faster than the government.
The transport minister calls Volkswagen's plan totally wrong and wants to keep an open technological mind. A look at Norway shows government back change gets results. So do clearly formulated goals. What we are telling is how fast this can happen. And it will be showing how fast it is.
So for the car industry, the selling cars in Norway and the future, they have to be zero emission. That's where we're going and it's happening now. So that's just a message. We have to make it happen fast and every country will benefit from being in the forefront of this change instead of lagging behind.
It's the end of an era. But also the beginning of something new. The sooner we accept that and seize it as an opportunity, the better. All of this can be done if there's a will to get it done. If we just sit back and wait to see what happens, then we'll face major problems. And I think we're already seeing the first signs of those problems today.
If car nation Germany doesn't look to the future, then others will shape its future. Industry and government have sat back too long. More of the same is no model for the future. We need to hit the road.