VW seems to be panicking...
Discussion
Nomme de Plum said:
To be fair Russia was seen as a potential partner and was even touted to be a future member of Nato. I think the USA put pay to that and the relationship went down hill rapidly after that. In hindsight had we tried to keep Russia on side it may well have worked and Putin may have had an unfortunate accident.
He didn't so here we are. Germany gambled and now have a big issue power wise. They had decided decades ago to dump Nuclear and maybe it is not in the German psyche to change.
Policy changed post fukushima. Merkel was all for nuclear until that event.He didn't so here we are. Germany gambled and now have a big issue power wise. They had decided decades ago to dump Nuclear and maybe it is not in the German psyche to change.
https://www.google.com/amp/s/amp.dw.com/en/how-fuk...
The leading political class in Germany were getting backhanders from Russia, they chose personal gain over a sensible long term strategy.
https://www.politico.eu/article/outrage-germany-ex...
You can't trust a despot like Putin, the USA administration knew that and tried to nudge Germany to do the right thing before they cornered themselves.
TheDeuce said:
To be clear I was outlining why the UK has not invested in trying to 'keep up', I wasn't suggesting we should or that we could even if we reduced worker conditions - which of course we never can, some things can only ever move in one direction.
We're out of the manufacturing business, we're still a wealthy country and that has much to do other sectors where we're extremely successful.
I guess it depends on how you define wealthy. The folks providing funding didn't seem to think so a while ago. Seeing as the thread is full of simplistic statements, maybe look at UK debt vs German debt or debt rating for that matter. We're out of the manufacturing business, we're still a wealthy country and that has much to do other sectors where we're extremely successful.
I'm not sure what this has to do with Volkswagen mind you. But I guess with a faltering currency, the UK will increasingly need to look for cheap imports from let's say China in order to maintain an acceptable price point. Or keep tax subsidising German EVs as is currently the case.
dxg said:
China has 90 car manufacturers of which almost none are profitable. China has car manufacturing spare capacity that is greater than the number of cars sold in Europe per year. The domestic consumer market in China is imploding as the new middle class has lost large amounts of wealth speculating on property and buying a lifestyle they could never maintain. China is running out of domestic customers for its higher value goods. China's car empire's only real option is to export or die. Meanwhile, the European manufacturers have spent the last two decades not focusing on being able to compete directly but seeking to use the EU to lock out Chinese competition while giving China all the expertise and ability to butcher them. I'm not entirely sure even tariffs can help at this point.
dxg said:
Jeez, if that's true it sounds like a confused man shouting about a problem they somehow didn't expect!?Anyway, VW have their new ID7 to rescue their fortunes! But unfortunately it's been criticised for all the reasons the rest of the ID range have been, zero excitement or driver engagement, so so tech, bland.
Most reviews seem to have politely given it a 4/5 stars on the basis there isn't anything offensively 'wrong' with it, but most also make a point of there being more interesting alternatives available, in their conclusion. It's also weirdly expensive compared to some obvious alternatives.
The ID range has been a flop in terms of VW's first foray into EV. Sure, they sold OK initially, ahead of cheaper alternatives arriving en-masse, but a lot of that has to do with brand loyalty and trust - the question is, have the bland cars been sold at the expense of eroding the brand itself? They don't seem to have capitalised on the strengths of EV, it's as if they were shy and in no way wanted their new EV's to risk being more fun or flamboyant than their traditional ICE offerings, which sounds sensible but I think now it's time to be a lot more confident with EV, they should be better - unapologetically so.
DonkeyApple said:
dxg said:
China has 90 car manufacturers of which almost none are profitable. China has car manufacturing spare capacity that is greater than the number of cars sold in Europe per year. The domestic consumer market in China is imploding as the new middle class has lost large amounts of wealth speculating on property and buying a lifestyle they could never maintain. China is running out of domestic customers for its higher value goods. China's car empire's only real option is to export or die. Meanwhile, the European manufacturers have spent the last two decades not focusing on being able to compete directly but seeking to use the EU to lock out Chinese competition while giving China all the expertise and ability to butcher them. I'm not entirely sure even tariffs can help at this point.
BMW seem to be doing the smartest thing, they've kicked their cars up a notch in luxury terms and have taken EV's very seriously from day one, they now have a convincing range of EV's that have the appeal and engineering kudos to convince enough people to pay the extra. Apparently their new upcoming EV platform will also save some costs too.
Mercedes, seem to be doing 'OK' but so far their EV's seem to ignore driver appeal, which is another reason people tend to be willing to pay more for a German car. VW are definitely the ones with most to lose as they're raison d'etre is to build cars for the common person, which is precisely what the Chinese are focused on and are going to remain focused on.
The point for the Chinese government - assuming their property sector doesn't completely implode and take everything else with it in the interim - is to "pump and dump" their products into well established markets overseas. Pricing below cost.
Do this for long enough and the incumbent Western actors (e.g. VW in the automobile sector) can't complete and go under. Then the Chinese take over and prices rise back to what they needed to be for business survival.
It worked for the Chinese previously with the Western steel producers.
And worked for the Rothschild family prior to that with American railroads.
Do this for long enough and the incumbent Western actors (e.g. VW in the automobile sector) can't complete and go under. Then the Chinese take over and prices rise back to what they needed to be for business survival.
It worked for the Chinese previously with the Western steel producers.
And worked for the Rothschild family prior to that with American railroads.
The problem for VW when it comes to Chinese trade barriers is that they make cars in China and they are one of China’s biggest brands if I’m not mistaken.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
DMZ said:
The problem for VW when it comes to Chinese trade barriers is that they make cars in China and they are one of China’s biggest brands if I’m not mistaken.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
My understanding is that things are going really badly for VW in China as well. I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
The Chinese consumer is far less tolerant of VW's quality problems, it seems. Esp. when the local brands are better.
https://www.ft.com/content/1386906c-5dd1-4167-bc96...
dxg said:
I've come across that chap before. He's fairly intelligent, but blindsided by being completely narrow minded. If we think EV's are going to take over the world, then he's worth a follow, but he has absolutely no interest in the headwinds facing EV market share expansion.Not to say that VW don't have some issues, they do, and especially in China. But if you read some of his other posts (if Tesla were to double today, its still a super cheap stock to buy) and he's absolutely convinced that the Tesla robot, Level 5 FSD with cheap cameras are coming soon, and nobody will get in their way. Thats where he loses credibility IMO. He's got his full savings and pension invested in Tesla, as well as convincing many of his friends and family to do the same. So take what he says with a pinch of salt.
dxg said:
DMZ said:
The problem for VW when it comes to Chinese trade barriers is that they make cars in China and they are one of China’s biggest brands if I’m not mistaken.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
My understanding is that things are going really badly for VW in China as well. I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
The Chinese consumer is far less tolerant of VW's quality problems, it seems. Esp. when the local brands are better.
https://www.ft.com/content/1386906c-5dd1-4167-bc96...
Audi sold twice as many cars in China during January as Tesla did, and continue to do so in Feb. So did BMW and Mercedes.
Which bit I am missing?
https://cnevpost.com/2024/01/30/china-ev-insurance...
Edited by coetzeeh on Wednesday 28th February 15:28
coetzeeh said:
dxg said:
DMZ said:
The problem for VW when it comes to Chinese trade barriers is that they make cars in China and they are one of China’s biggest brands if I’m not mistaken.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
My understanding is that things are going really badly for VW in China as well. I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
The Chinese consumer is far less tolerant of VW's quality problems, it seems. Esp. when the local brands are better.
https://www.ft.com/content/1386906c-5dd1-4167-bc96...
Audi sold twice as many cars in China during January as Tesla did, and continue to do so in Feb. So did BMW and Mercedes.
Which bit I am missing?
https://cnevpost.com/2024/01/30/china-ev-insurance...
Edited by coetzeeh on Wednesday 28th February 15:28
Tesla models are being updated.
So the ‘old’ versions drop off a cliff.
Updated models coming in now.
DMZ said:
The problem for VW when it comes to Chinese trade barriers is that they make cars in China and they are one of China’s biggest brands if I’m not mistaken.
I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
Yup. It's an issue for German manufacturing as a whole over French as Germany favoured an expansion into China utilising cheap local labour etc which now leaves them slightly trapped when it comes to anti China rhetoric back West. I suspect the bigger problem is the complete lack of FOMO when it comes to EVs. Deflation is obviously a big factor and VW has been on a big price cutting spree along with others and then there’s the reality of something new and better and perhaps cheaper in another few months. Unless you are stuck on the lease train, why bother? Particularly if you already have an EV that keeps ticking in the same EV benefits.
VW is having an issue in China currently as its target demographic of new middle class Chinese has revealed itself to not be remotely middle class as it has spunked all its money on gambling, fags and shiny tat to impress the neighbours. So now the property speculation bubble is bursting, debt financing has leapt they can't afford the payments on their fancy foreign goods rentals anymore.
The manufacturers also have the not insignificant problem that they have all acted similarly with regards to ICE sales which has been to increase pricing to compensate for the reduction in sales volumes but when it comes to EVs, again, they don't have dominance in that market so haven't been able to manipulate it upwards as the likes of Tesla have preferred to maintain volume by discounting
I suspect that VW's new production line in China that is for producing cars for the Chinese market is actually planned to export to Europe to combat the cost and net zero issues.
coetzeeh said:
So according to the FT article VW BEV sales showed 24% growth in 2023 - is that really bad?
Audi sold twice as many cars in China during January as Tesla did, and continue to do so in Feb. So did BMW and Mercedes.
Which bit I am missing?
https://cnevpost.com/2024/01/30/china-ev-insurance...
24% is well below what they saw in other markets and China represents the backbone of not just their EV expansion but sales growth altogether so in reality 24% is a big miss. Audi sold twice as many cars in China during January as Tesla did, and continue to do so in Feb. So did BMW and Mercedes.
Which bit I am missing?
https://cnevpost.com/2024/01/30/china-ev-insurance...
Edited by coetzeeh on Wednesday 28th February 15:28
They also only had 1.6% total sales growth in China which is the key worry but it also suggests that the growth in EVs not o ot came about through discounting but then by taking sales from its ICE market.
This is one of the big benefits that Tesla has in that when it discounts to prevent inventory build up it doesn't have any other business to risk taking clients from, so long as it balances the discounts between models, of which even then it only has two of merit, all it ever does is take sales either from competitors or from its used market (which is free to then drop in value to reflect the cuts in new so limiting that impact). The latter being their other big benefit which is that Tesla doesn't own their used cars unlike the likes of VW who retain them on their balance sheet so that they can manipulate their values against consumers as part of their new car financing model.
This means that firms like VW who in Europe have been raising ICE prices to compensate for lower volumes and less ability to accurately control yr 3 values have to try and increase EV sales in that market knowing they may need to discount to compete against Chinese production but rather than taking sales from the competition could just end up digesting themselves.
And then you have some really weird marketing behaviour out of VW such as banging on about imaginary eFuels for the peasant masses, even promoting the tale via their Porsche brand while the entire business plan of Porsche is to go pure EV thus revealing the marketing lie utterly overtly They're an inherently dishonest company where lying is just a core part of their DNA and has been from the time Ferdinand first started playing with cars and the lies from the family and their chosen employees flow as readily today as they always have which will pose more issues for them as they shift more European jobs to China and face the unions along with the net zero challenges which they can't simply 'engineer' their way out of.
The business will survive but it's in for a difficult run to 2030 as Europe's big playground bully has a new boy who is going to slap them about a bit and quite possibly supplant them.
Gassing Station | EV and Alternative Fuels | Top of Page | What's New | My Stuff