Five reasons for optimism: How the German car industry is changing

At the weekend, the largest car show in Germany closed its doors for visitors in Munich. Time for an inventory: Where do we stand as an industry?

Much has changed at the IAA this year: new city, new auto show concept – and the guests were attending virtually and, to a reduced extent, physically again. It could be seen at every turn how the automobile has changed and will change even more in the coming years. In short, this IAA Mobility was a visible signal of change.

Five reasons for optimism:?

1.??German manufacturers are shaping the change

The German automotive industry is transforming. Above all, this holds true for our products:

• German OEMs alone offer more than 25 all-electric cars made in Germany.
• Electric ranges rise while charging times decline - also driven by technological innovation made in Germany.
• The world champion in aerodynamics is made in Germany.

We can confidently say: The German automotive industry offers customers highly attractive and competitive electric cars today.

Including the EQE, we have unveiled four new all-electric Mercedes-Benz vehicles this year alone – along with our EQA, EQB and EQS. In 2022 we’ll have at least one all-electric option in every segment we serve. By 2025 we’ll provide at least one all-electric alternative for every model we make.

The supply is increasing. And demand is on the rise in the same way.

2.??Customers demand the change

More and more people share our view: electric mobility is developing into the superior drive technology. Every fifth car newly registered in Germany in the first half of the year was at least partly electric. Across Europe new EV registrations sky rocketed by more than 230 per cent in the second quarter year over year.

What is also clear is that we aren’t there yet. From a customer’s perspective the expansion of the charging infrastructure remains one of the most crucial turnaround factors. Lasting success therefore calls for a joint effort from many different parties.

3.??Governments support the change

Speaking of parties: In Germany, the Federal Election is coming up in September. As I’m from Sweden, I am not allowed to vote here. But I stand excitedly on the sidelines. Whatever the outcome might be, I am convinced that all of the democratic parties understand there is a gigantic task ahead of us. Which is good, as we’ll have to work united - and determined - in one direction.

One decisive driver for the spread of electric mobility at scale remains charging technology and charging infrastructure. As manufacturers, we take responsibility here, too. But the expansion and development of this infrastructure must be in line with the EV ramp-up.

For example, to reach the EU Commission’s recently published CO2-targets, we’ll need far more than three-million public charging points across Europe by the end of the decade. Today, we have less than a tenth of that. In Germany alone, we’d need to connect 2,000 charging points to the grid – per week. Today, we’re only connecting around 300 per week.

In addition, we need digital technologies to make electric mobility as convenient as possible.

4.??Digitalisation accelerates change

Digitalisation is paving the way and accelerating change. It makes travelling smarter, more efficient and more relaxed. Distance is no longer the only decisive factor in calculating the ideal route; digital systems also take into account the charging level of the battery, charging infrastructure, topography, the current traffic situation and weather data. Connectivity also ensures that your own car communicates with other cars and the infrastructure.

This can help to increase safety, improve traffic flow, reduce emissions and upgrade the overall quality of life. Intelligent parking management alone could save up to 0.9 million tons of CO2 in cities – about as much as all domestic German flights in 2019 combined.

Digitalisation will also contribute to cars serving as flexible, rolling storage units for surplus wind and solar power in the future. Our industry is working on preparing cars for bidirectional charging. This means that cars will no longer just draw electricity, but also return it to the power grids, thus stabilising them.

After their active career, electric car batteries can also continue to serve as energy storage units for the smart grid of the future. The batteries can be recycled to limit the consumption of precious materials. We are currently planning the construction of a battery recycling factory in Kuppenheim, Germany, to build up recycling capacities and know-how.

The automotive industry is working on decoupling resource consumption and volume growth. We want to move towards closing the value cycle. That brings me to the fifth and final reason why we can be confident.

5.??CO2-neutral mobility: the most fascinating task of our generation

Ahead of us is the most important task of our generation: The transformation to a CO2-neutral economy and society. When I started at Daimler, technologies such as automated driving, or emission-free and fully connected cars were pure science fiction. Today, it’s all reality. If we pull together across all borders the transformation to a CO2-neutral society will be the next reality.