The collapse of Germany’s government is not directly related to Volkswagen, nor is the prospect of new elections precisely tied to Germany’s more open approach to China. They are not unrelated, however, and there’s a way to view Volkswagen’s issues with China and Chinese suppliers as an analog for a lot of what’s gone wrong in Germany.
Yet again, Volkswagen is facing the prospect of having to ditch a supplier over human rights concerns, though the issue is with a Chinese supplier operating in Europe and not in Asia. Continuing on the theme of yesterday’s Morning Dump, Volkswagen’s über-performance-brand Lamborghini is hitting pause on its electrification plans as it waits to see what the market actually wants.
The Biden Administration, on the other hand, is hitting fast-forward on its loan programs to companies hoping to build factories related to electrification. Despite fears that the next administration might slow down chargers, some think it would take an “act of God” to reverse those plans.
There’s a lot to talk about for a Tuesday, so let’s jump right into it.
VW Subsidiary Has To Ditch Another Chinese Supplier
If the second half of the 20th century was all about the ascendance of Germany and then Japan in the global car market, it seems clear that the first half of the 21st century is all about China and, to a lesser extent, South Korea. Part of Germany’s economic might at the turn of the century came from its growing relationship with China, which involved sending its manufacturing and industrial expertise to Asia in return for a lot of money and access to China’s market.
There’s an argument to be made that the China Shock of the 1990s over here was aided and abetted by European companies, and in particular German ones, that helped China quickly industrialize and flood the American market with cheap goods. In general, Germany has relied on its industrial might to navigate the many financial upheavals of the last 30 years or so, with China as a key partner.
Keeping Germany’s key industries running was a big part of maintaining political stability for the country’s moderate Conservative governing party and, more recently, its shaky “stoplight” coalition government. Not only did the greater economy need to be stable in order for the country’s leaders to keep both the right-wing and left-wing parties from gaining too much electoral power, but companies like Volkswagen were encouraged to build plants in the former East Germany to boost employment in these areas.
Unfortunately for Germany, there was a bit of realpolitik involved in all this that the country is now having to face. The first shock to the system came when Russia invaded Ukraine. Germany, and much of the West, looked the other way as Russia intervened in the politics of other countries in exchange for cheap energy flowing via a pipeline to German homes and factories. The invasion of Ukraine put an end to that.
The issue of China has been much harder to deal with as the economies of the two countries have long been more intertwined. Volkswagen was essentially the biggest automaker in China for decades due to early local partnerships and, in recent years, more exports to the country. Volkswagen brands still sell millions of cars there, but not as many as in the past as some of the expertise it helped build in the country has been coopted by Chinese firms making cars better suited to local tastes.
Porsche SE, the Porsche/Piech group that owns the largest share of Volkswagen, is already writing down the value of its stake in the company by $21 billion in no small part due to issues with China:
Analysts have warned the combination of pricing pressure, lower dividends from China joint ventures and committed investments will likely leave Volkswagen with a free cash flow close to zero in coming years, boding badly for Porsche SE’s financial stability.
As if sales in China dropping wasn’t itself wasn’t a big enough problem, Germany, in order to keep its good relationship with China, had to vote to try to allow Chinese automakers to sell its cheap cars in Europe, where VW is struggling.
This brings us to this week’s report from Manager Magazine that VW’s truck brand MAN, is stopping the use of tires from upstart Chinese tire manufacturer Linglong over credible reports that the company committed human rights violations against Indian workers building its new tire plant in Serbia:
Zrenjanin in northern Serbia, an hour and a half from Belgrade: Until February 11, 2024, 14 Indian workers were apparently temporarily housed here in order to build the first Chinese tire factory on European soil. Beds without mattresses, contaminated drinking water and illegal employment contracts – this is clear “exploitation” according to the local human rights organization Astra, which had contact with eleven of the men and has extensively documented the conditions together with the Serbian investigative media “Balkan Insight” . “We suffered from everything,” wrote one of the alleged victims to manager magazin via a group chat, “our company made us suffer.” The atmosphere was threatening.
Worse for Volkswagen is the fact that the new Tiguan is rolling out on Linglong tires, forcing the company to “investigate” the issue, which is likely to further aggravate the Chinese government. This isn’t the first time Volkswagen has had issues with Chinese suppliers, as earlier this year he company had thousands of its Audi, Bentley, and Porsche cars stuck in ports here in the US due to suspicions of parts made using forced labor in China.
Germany’s Chancellor Olaf Scholz essentially asked for a “no confidence” vote this week so that the country could have an early election and answer the question of who is really in charge. If the more conservative parties in Germany fare well the issue will become potentially even more complicated as those parties don’t seem quite as inclined to serve Chinese interests, and may become more aligned with the rest of Europe and the United States on the issue.
Both Germany and Volkswagen have to decide the value of the partnership going forward amid increasing pressure both at home and abroad.
Lambo’s First EV Now Not Coming Until 2029
In keeping with the theme of this year, Lamborghini has said it’ll delay the rollout of its first full EV model until 2029, instead of 2028, reports Reuters:
“We do not think 2029 is late to have an electric car. We do not think that, in our segment, the market will be ready in 2025 or 2026,” Winkelmann told reporters at Lamborghini’s headquarters in Sant’Agata Bolognese, near the northern Italian city of Bologna.
As a premium exotic brand, Lamborghini can afford to pass on the costs of those delays in any gas guzzler/carbon taxes onto its customers.
Ford Gets Final Approval For $9.6 Billion Loan For Battery Joint Venture
Ford and its battery partner, South Korea’s SK On, will get the biggest loan ever from the Advanced Technology Vehicles Manufacturing loan program of $9.63 billion to create plants in Kentucky and Tennessee.
From Reuters via the Detroit Free Press:
The amount is higher than the $9.2 billion conditional commitment announced in June 2023 for the BlueOval project. Trump and his advisers have been critical of the Biden administration’s efforts to incentivize EV production.
“This program is essential to getting people to choose the United States of America,” Jigar Shah, who heads the DOE Loan Programs office, said in an interview. “When you look at the competition that we have from China, it is very clear to me that they have used low-cost debt for a very long time to promote a lot of manufacturing capacity that has hollowed out many communities in Kentucky, Tennessee and other states around the country.”
Once allocated it’s unlikely a new administration will be able to, or even try to end a program that’s building plants in traditionally Republican areas.
It Would Take ‘An Act Of God’ To Overturn EV Charging Money
Yesterday, I encouraged people to buy an EV now in case tax incentives went away. A part of that conversation was the noise that the Trump transition team was making about removing support for EV chargers.
A new report from Automotive News indicates that maybe it’ll be harder to reverse the push towards more charging than initially thought:
“It would take almost an act of God for Trump or Congress to overturn” the National Electric Vehicle Infrastructure program, said Loren McDonald, chief analyst at Paren, which recently acquired McDonald’s EV Adoption firm.
That’s because much of the $5 billion that underpins the initiative has already been doled out to the states. The remainder was preapproved. Policymakers designed the five-year program, which started in 2021, to help states create a network of public charging stations in 50-mile intervals along interstates.
That’s a great quote. McDonald goes on to say that private companies were already in the process of rolling out chargers, with the public money helping speed up adoption by reducing the amount of time it takes for these companies to break even.
What I’m Listening To While Writing TMD
When my daughter gets upset she’ll just straight up lay on the floor, which happened today and reminded me of Radiohead’s “Just” video.
The Big Question
How many EV chargers are you near? Are new ones being built?
I’m in rural Ohio. I’ve got Tesla super chargers 30 minutes away from me which is about 30 miles in one direction and I think there are few in the opposite direction at the same time/distance away. Both are at Sheetz stations, mine doesn’t have any. Pilot which has a location 5 minutes from my house just built GM Energy chargers and I believe the Loves going in across the street will also have chargers. I’ve not confirmed Loves though. Apparently there’s some chargers at a Best Western near me as well. The GM dealership has a single charger in a terrible location on their lot. As far as I know, they’ve had exactly 2 BlazerEVs and that’s it. They let Cadillac leave when they said no to the EV mandate by GM. They are owned and operated by that stereotypical Maga Boomer who runs bible quotes on a digital sign all day so I don’t see them really carrying any EVs unless absolutely forced to and even then they don’t try hard to sell them. I’ve been wanting to see an EquinoxEV and they haven’t had one. Teslas have been the most prevalent electric vehicles around here but I’ve been seeing quite a few electric VW’s lately. Followed closely by Ford F150 Lightning.
There are roughly four or five charges at the Walmart near me. No new charging stations have been or are being built.
Does she lay on the floor or lie on the floor? Pedantry to the rescue! My mother corrects me on this every single time I screw it up, which is basically every time I say lay or lie.
Two of our three kids would lie on the floor when upset. One of them would sometimes roll on his belly and flops his limbs around in the most stereotypically comical way. I felt so bad when I would just laugh and laugh.
Isn’t “lie on the floor” what a congressperson does when making a speech?
Senators too. 🙂
Pedantry!
Shouldn’t all manufacturing done by chinese companies be investigated for exploiting workers/children?
Well attempts are made. It’s important to distinguish so we know where to look. Is it the labour practises of the companies in China? Or the laws in China that enable them? I’d argue China is enabling abuses, but that does not mean every company takes advantage of that. There are some good actors. In the case of this example, yes Chinese company, but this was in Serbia. I would argue the Serbian government should also be accountable. Especially since they are trying to join the EU. Likewise, look at all the automotive production in Hungary. Not exactly a beacon of human rights. Although they probably have some decent worker protections.
Transparency is one of the most abused terms we hear these days. It just ends up meaning “nothing to see here”.
It’s mostly China’s systemic enslavement of the Uyghurs, which is so bad that even the US Congress has passed actual laws against it.
The only charging stations I notice regularly are the ones at a local grocery store chain. Outside of that I have no idea what, if any, other charging options are available.
Checking the map, it looks like there are maybe a dozen total in my city of ~120k, but most of them are in places I don’t frequent so I don’t see them. They are pretty reasonably placed though, most of them being either downtown or near the main highway through town. Better than I realized, although I’m not all that surprised since it’s a fairly affluent city that probably has a fair number of EV drivers.
I can look out my window and see 4 chargers at work. There are a number around me and more seem to be appearing.
Right now‽
Do they look angry? Are they whipping their charging cords around in a circle, moving ominously toward you as more and more join the force? Do you have access to an ICE vehicle so you can flee?
I’m experiencing the same and they are all muttering “brains, brains…”
I’m pretty sure they are all from the Electrify America graveyard.
The Bends is my favorite Radiohead album and this is a great video.
Have you ever heard the Anthrax cover of The Bends?
I have now! Whoa, I was not expecting it to be a faithful rendition; I expected it to sound like Anthrax! That’s more singing than John Bush did on all of Sound of White Noise put together. And I understood waaaay more of the lyrics than on the original!
Thanks for the tip!
Glad to help.
There is an Arco gas station with some chargers that I never see in use, a Tesla supercharging station, and what I assume are a bunch of Electrify America chargers in the parking lot of the Walmart. Not bad for a town of 20,000, but I assume they are mainly there to cater to the big city dwellers headed out to the coast for vacation.
“Germany, and much of the West, looked the other way as Russia intervened in the politics of other countries”
The history of how frequently and sometimes brutally “Germany, and much of the West” – including the good old’ US of A – have “intervened in the politics of other countries” doesn’t really put those countries on a solid moral high ground.
But we’ve had so much success bringing democracy to the world!
One of my personal favorites:
Nikolaus Barbie (25 October 1913 – 25 September 1991) was a German officer of the SS and SD who worked in Vichy France during World War II. He became known as the “Butcher of Lyon” for having personally tortured prisoners—primarily Jews and members of the French Resistance—as the head of the Gestapo in Lyon. After the war, United States intelligence services employed him for his anti-communist efforts and aided his escape to Bolivia, where he advised the dictatorial regime on how to repress opposition through torture. In 1983, the United States apologised to France for the U.S. Counterintelligence Corps helping him escape to Bolivia, aiding Barbie’s escape from an outstanding arrest warrant.
https://en.m.wikipedia.org/wiki/Klaus_Barbie
Go freedums!!!
And yet, after all of that people continue to trust the US intelligence community to be honest and forthright in all of their other dealings, “we’ve totally changed, I swear! Iraq was absolutely the last time we lied to drag the country into a war!”.
None yet. I thought they decided to build the V6 Charger first?
I hear theyre ditching the EV for a hemi, since i guess theres a new president who hates EV’s but supposedly his best friend/biggest donor builds them or something? Strange world we live in.
*happens to be CEO of a company that employs talented people that builds EV’s
So VW made the choice to go with Linglong and prosper? Talk about vulcanization.
It was the logical thing to do.
To be fair, they probably never thought they would tread on their worker’s rights.
Just their backs.
They just wanted to kling onto their old ways of doing things.
They are a for profit enterprise.
Sounds about right. My 5 year old will do similar. My daughter prefers to exercise her vocal chords when she’s mad.
And also: Why are Indians being brought to Serbia to build a tire plant? This is beside the fact that the UK should be funding the basic living needs of everyone in India and its diaspora for another century or so as reparations (and, frankly, owes a big moral debt to China over the opium trade too), but there are plenty of Serbians who could do the building. If those Indians have specific necessary skills they should be compensated with fancy fringe benefits like clean water and bedding just to be competitive with other employers.
LOL. Lowest cost solution wins always in the shareholder driven world we live in. The moment you use local labor is the moment you have to start giving a shit.
So what labor do companies in India use?
Uyghur’s?
Pretty sure China’s got a lock on those.
I’m pretty sure India is just one country.
Fixed in post.
Imma go with Bangladeshis
Other Indians. The caste system hasn’t gone away.
A very “simple” gesture would be to return the damn Kohinoor diamond.
Diamond! The most boring possible form of carbon…
Obviously Serbia needs to build a wall! And make India pay for it!
Make Serbia Great Again!
Come to think of it I’m pretty sure “Make Serbia Great Again” was what lead to WW1…
Some might attribute the start of World War I to the flailing of a large but declining and divided empire unwilling to adapt to a changing world, but that doesn’t have any modern parallels at all.
More specifically:
https://en.m.wikipedia.org/wiki/Black_Hand_(Serbia)
In Canada, the EV Charger hasn’t landed yet, so none are near me. But initial reviews seem it’ll be as popular as charging stations with the new US Administration.
I have seen zero new chargers built since I have been paying attention for the past half year or so.
With that said, public charging is horrible. Period. Anything less than Level 3 is completely pointless unless you are going to be parked there for more than 2 hours.
Level 2 charge rates are about 25-30 miles per hour. In order to recharge any decently substantial range, you need a couple hours, minimum. Unless you have “something to do” for 2 hours, no one is going to want to sit at a charger and wait unless they are on a road trip and have to.
Level 3 charging is acceptable. BUT, there are WAY fewer Level 3 chargers (around me, and I’m in a good market for this). Most chargers I interface with are Level 2 chargers. Yes, there are a number of Teslas SC sights around me, and I rarely see them fully occupied. And, NO, I don’t have an adaptor yet to use them. Another barrier to entry for them.
My point; this transition is still very very rocky. It is going to take a lot more investment in infrastructure to pull the “average” automotive customer into buying one. And, even then, outside of roadtrips (where it’s required), charging away from home is a horrible process I try to avoid like the plague.
Swappable batteries and V2V communication are the two major innovations we are all waiting for. Until there is political capital to make these happen, the ICE will continue to exist.
ICE can continue to exist in the form of PHEVs and REXEVs. You may not get the manual shifted, high revving, flat plane, wailing V8 torque monster you want but you’ll get the range and convenience you need, at least till the rest of EV tech catches up.
I like swappable batteries too. I do have questions on how well those would work in the rustbelt though.
The power delivery from an EV is just so much better than ICE. My crappy little Bolt is so much faster than everything else on the road. I’ve come to do things in this car I would NEVER imagine doing in any of my other cars. The level of confidence it inspires is pretty amazing.
There’s no reason a PHEV or REXEV can’t do the same.
Totally agree!!! No issues with either, just not interested in owning either one.
I agree with this. There are a couple dozen near me. But it’s 4 at this office building, 2 at another, 2 at Holiday Inn, etc. It’s a mix of Level 2 and 3. Hardly the degree of infrastructure that would compel me to buy an EV, even though I am very pro-EV.
There is a lot of federal money out there and a lot is being done. But it’s SLOW. Federal money goes to the states, states take months to set up grant programs, companies take months to apply, and then a 2-year project to install chargers and electric buses at your local school can begin.
Yeah, they need to be put in more logical places. This first round put them “places”. And those places weren’t the most convenient.
“Honey, mind if we put the litterbox between our pillows on the bed??”
IIRC, your daughter wanted either the Jag or the giant van, not a suburban weeny CRV Hybrid, so her lying on the floor is the very least you deserve.
Linglong is working very hard to be a stereotypical caricature of a Chinese tire brand.
Linglong also has a doorbell division, DingDong! 😉
that got me. kudos.
Thanks♪(･ω･)ﾉ
EV chargers: Last weekend I went skiing at Eldora Resort. They had 30 L2 chargers in the parking lot at no cost to charge. This is how it should be – not 2 or 4.
Hopefully other ski resorts, work locations and places where you park for 4+ hours will take notice and follow this model. you don’t only need L3 superchargers.
Our local ski mountain in NH has the same, probably 10-12 L2 plugs. L2 is just fine if you are on the snow all day. Last year I mostly had the chargers to myself, this year they are typically about half full thus far
Good to hear another place is investing in chargers, probably half the time I use L3 chargers could be avoided if there were more L2 chargers around. Ubiquitous L2 chargers would really make a lot of travel easier, whether in normal neighborhoods when visiting family, or campgrounds (remote ones, since we avoid the KOA types at all costs), or even spots like the top of mountain passes- I certainly dream of being able to stop on the top of Red Mountain Pass and backcountry ski or hike for a couple hours while charging just a bit for a buffer to make it home.
That’s a great question and my answer is I don’t really know. I have a charger in the garage and that’s all I’ve ever needed. I see Superchargers from time to time but mostly because they stick out in the back corner of some large parking lots. I know of some chargers in the parking lot of the new apartments they just built up the road.
Now that I’m thinking about it I really don’t see them around here all that much at all.
Is it the US spec Tiguan or the unrelated euro one that is getting the OEM Linglongs?
If it’s the US one, Is that the first case of Linglongs coming from factory on a car sold here? I’ve always known them to be cheapos that trade-ins and rentals get when the stock tires are donezo.
I guess VW is gambling that the typical Tiguan buyer doesn’t notice or care.
I understand it to only be European Tigs.
That makes sense, Especially since Chinese cars are already being sold there without any badge engineering. Really caught me off guard that VW would try that in the US given Linglong tires are basically meme tier amongst car enthusiasts
Wild prediction: Trump’s only going to have a minimal impact on EVs. He’s only making a big fuss about it now because it’s being done by Biden. Giving Ford $9.6bn to make factories is objectively good for America (until Ford pretends it can’t make enough EVs to meet demand, again).
THAT SAID, it absolutely could go tits up because Trump, but I don’t think Trump hates Biden nearly as much as he did Obama.
>How many EV chargers are you near? Are new ones being built?
According to PlugShare, there are 7 chargers (not locations with chargers, actual chargers) within 5 miles of my house (SWFL).
Trump hates Biden WAY more because he beat him. Obama gave him one of the best economies in history. He only hates Obama because he is $*^#^ and his electorate is #@^#!&.
This is a fun Mad Libs, the options are limitless!
It’s the same word! After I hit “send” I realized I should have used the same symbols for both.
He only hates Obama because he is Butt and his electorate is Butt.
Because he is Phoebe and his electorate is Phoebe.
Trump will make virtually no changes but spin EV and hybrid market growth in a way that makes it look like all those new battery factories and jobs were all his idea and due to the brand new policies that he put in place all by himself and totally didn’t come from decisions made way before he got there.
Exactly what I’m thinking. He could even spin it as “protection” against BYD making a foothold here.
bingo. and just like the ACA he’ll talk a lot of smack about it and how he has a better approach. but ultimately it’s just more hot air.
Every time someone freaks out about all the things he’s “promised” to do, I remind them not to worry so much because first and foremost… he’s a liar and a conman.
TBF he’s not the first politician to fail to deliver on campaign promises.
true. campaign promises are one thing. but saying we’re “2 weeks away” from an ACA alternative for 8 years is a bit different.
Precisely.
..which is why if BYD sends someone over to Mar-a-Lago with a suitcase of cash, he’ll subsidize BYD’s new factory in Alabama the very next day
There seems to be more Level 3 chargers added around me than Level 2. 3 years ago there was one EVGO station that already shutdown. Today there are at least +20 Level 3 stations in a 15 miles circle from my house, including a Tesla Supercharger location.
Today I can drive and just tap on my map to look for a charging station, I don’t require as much planning as before.
Hey, that’s the Ford battery plant that was going to be in Virginia. Thanks a load, Youngkin. You twerp.
Technically, the plant that Youngkin killed I think was the CATL project with Ford that ended up in Marshall, MI and not the SK On plant in Kentucky/TN.
It’s not relevant to this discussion, I guess, but Governor Fleece-Vest would be a twerp even if he started crapping out high-density solid state battery cells on his own.
I don’t have a plug in car, so I don’t pay much attention, but all the Wawas certainly have a healthy quantity of Superchargers that seem to be heavily used, but never completely occupied, which probably means capacity is sufficient. As opposed to the air compressors, which always have a perpetual line of a half dozen cars waiting, even though the nozzle is most likely broken anyway
There are a few chargers around here, the only “new” is a Supercharger site that has a bunch of equipment sitting on pallets inside a temporary fence, that has seen no progress in ~6 months.