They are meeting in Berlin again this week. It's about subsidies for the auto industry, about fueling consumption. Citizens should feel like buying a new car, but this time it is not that simple. Because many parameters have changed, and what was successful as scrappage bonus 1.0 and 2.0 could no longer stand out.
The car. It has been in the pillory for years. Is dirty, impossible and at most tolerated as an electric car for private transport! What type of drive should you promote with a scrappage bonus 3.0 without losing credibility? The problems begin here.
As a mobile chemical laboratory, the diesel has become clean. The majority sure, with a manufacturer, the fuse of the doubt is glowing again. On long journeys a sensible type of drive, which you definitely cannot subsidize after talking about it for years.
Maybe plug-in hybrids? They are mobile surprise packages. In theory, they could stream through the city centers. Pollutant-free with green electricity in the cells. The big unknown in this calculation is the driver. Does he run on electricity or fossil energy? The decision is up to him, and one can assume that the majority of the plug-in hybrids are operated purely fossil due to habit and convenience.
That leaves the purely electric car. Battery operated, whereby I deliberately leave out any doubts about the extraction of raw materials. In principle a good thing, especially for the metropolitan regions. It is particularly welcome when the electric car is powered by electricity from renewable energy. A candidate for even more massive funding than before?
The thing has two huge hooks
Electric cars are expensive. Not for the well-off family. She buys the subsidized Stromer as a green fig leaf. The Panamera and the Diesel Audi are still in the garage for the weekend tour for après-ski. No problem! Things get a bit more difficult for people with slightly less money. So a normal income. Without a second or third car and without a carport with a power connection. The majority of the lantern parkers, the tenants.
It will be tight for them when it comes to electric cars. You are likely to be the one who will suffer the highest percentage of income disadvantage as a result of the crisis. Are they ready for a car category that is expensive and has disadvantages? Around € 30.000 for a small electric car - are they in the family's budget? Are they the target group that is planning longer journeys as a charging station slalom and waits with humility until the range is right, while the youngsters grumble in the background and the coffee is already getting cold with Grandma?
The auto industry will brake
Even more funding for electric mobility is not really welcome. There are Tesla who like to sell their electric drives. You only have that in your portfolio. But it looks different with the established ones. The corporations will do everything in their power to land an electric car in 2020. Please not too much of it, under no circumstances exceed the CO2 targets!
That would be unpleasant for the future, because you would be forced to save even more CO2 in the following years than you already have to. Small dose electric cars, a little more every year, that's welcome. Nothing else. So what will happen? Subsidies for the sale of new cars? The warehouses are full of new vehicles, used vehicles a few months old, annual vehicles and returns from leasing contracts. The inventory is depressing dealers and manufacturers, and it is difficult to find a solution that does justice to the situation. Maybe even impossible.
It may even be that economic and social reality will lead the discussion to absurdity.
Scrappage bonus 3.0. Trends against it.
There are young trends. And they're not good for the auto industry and fueled consumption. Large company car fleets are immobile in the crisis. Companies are reacting, digitization is sweeping across the country with dynamism. What has been warned for years suddenly goes. Sales representatives stay at home, sales are organized via the network. Conferences and meetings are canceled, scary for hotel operators and restaurants. Pleasing for the providers of video conference systems, whose market with Corona has literally exploded.
Working from home is becoming the norm, and the longer the crisis lasts, the more all these young trends will solidify. Fewer cars are needed in the medium term, companies are already reducing their fleets and are not ordering a replacement after the end of the leasing period. Instead of the company car in front of the door, employers have the option of more salary as compensation.
An interesting trend that is good for the environment. That very quietly brings what politicians have been demanding for years. Troubling for corporations. Especially if controllers have recognized the savings potential through digitization and will consequently exploit them further. 2,36 out of 3,6 million new vehicles were new to commercial customers in the Federal Republic in 2019 authorized. The crisis could fundamentally change these numbers in the future. Car production is already expected to decline by 20% in the current year.
Do subsidies still make sense for the automotive industry?
In the current situation, do people want new cars, the purchase of which they usually have to finance through loans? The scrappage bonus 3.0 - there are doubts. Maybe the crisis is turning things around. The auto industry included. If home office and video conferencing establish themselves, it will not be the end of the automaker. Mobility is always required. Only the products would have to be different then. Inspired, innovative, sustainable.
Images: Volvo Cars (1)