Daimler CEO: 1 Million Electric Cars in Germany by 2020? Not Likely

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Dieter Zetsche

Dieter Zetsche

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It may only be two weeks since Germany’s Chancellor Merkel announced that her government would help bring 1 million plug-in vehicles to the roads of Germany by 2020 but her bold goal is already being dismissed as impossible by the very automakers her Government is planning to help. 

Enter Daimler CEO Dieter Zetsche.

Talking to the German Bild newspaper earlier this week Zetsche was far from welcoming of the German government’s electric vehicle program, which includes $1.4 billion investment in electric vehicle research and development. 

Why?  It lies in the lack of purchase subsidies for electric cars. Unlike the U.S. and most of Europe, Germany doesn’t offer purchase grants or even tax credits for those buying electric cars. 

Smart ForTwo ED

Smart ForTwo ED

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According to Zetsche, that’s where the problem lies. While automakers know already know how to make electric cars, electric car sticker prices are still prohibitively expensive for most car owners. 

With cars like the 2011 Smart ForTwo Electric Drive costing well over twice the price of its gasoline counterpart and no purchase incentives, Zetsche predicts an extremely low take-up rate. 

He has a point. Electric cars are currently more expensive than their gasoline counterpart, partly due to the costs of expensive lithium ion battery packs but also the economies of scale. 

Mercedes-Benz SLS AMG E-Cell

Mercedes-Benz SLS AMG E-Cell

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Right now, there simply aren’t enough electric cars being made in order for costs to be kept low. Very few automakers are willing or able to subsidize electric cars in order to make them truly price-competitive with gasoline cars on sticker price alone, so Zetsche argues that buying incentives and subsidies for the purchase of electric cars are essential. 

Without additional consumer incentives, Zetsche claimed at best only 500,000 electric vehicles would exist on the roads of Germany unless some form of purchase incentives were implemented by the German government. 

Are incentives essential to the uptake of electric cars? Or should early-adopters pay a premium for being among the first to switch to electric cars? Let us know in the Comments below. 

[Bild via AutoNews]

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Comments (10)
  1. "Economies of scale" is a rather silly reason for assuming high EV costs. Right now Nissan is using a regular chassis and most of the parts of a gas powered version of the Leaf. Deriving an EV from an existing ICE vehicle mostly consists of not putting all that paraphrenalia that accompanies a gas powered drivetrain (engine, transmission, exhaust system, fuel system, cooling system, etc, etc).
    The major stupidity on the part of the Zetsche is his belief that he actually can even estimate the likelihood of future EV sales. They depend, almost in totality, on the cost of batteries and I can guarantee that Zetsche is unqualified to even make a guess on the future of those technology costs. So why is he sitting there pretending that he can?

  2. I think that he is probably quite a bit smarter than you take him to be. He just feels that there will be a low take up rate because there are now government subsidies to someone buying an electric car in germany, compared to somewhere like Ireland where there is a 5,000 euro subsidy and a free charger installation.

  3. Ego.

  4. or better yet, they can raise the gas tax (sin tax) and use the revenue to build charging stations and provide EV subsidies.

  5. This could certainly be true, 1M cars in Germany being electric by 2020, however they won't be made by German companies. The vast majority will be made by Renaut/Nissan, Mitsubishi or even Ford. Germany may be far ahead in solar however they are hugely behind when it comes to EVs.

  6. I think that if German car makers don't lead the electric car movement in their own country it would be a great shame. Germans are very proud of the fact that they are known all over the world for building quality cars and like to buy german made cars. I think if they ever feel they are being left behind, they have plenty of the brightest engineers to help them catch up pretty fast!

  7. The Germans are already paying about the equivalent of $9 per gallon for gas. In some respects EV's should have a much higher payback. It is pretty hard to give tax incentives to convert when Germany debt is already high. They cannot even play the "tax the rich" card there. Everyone is taxed heavily. I was there on business and everything you buy has various taxes for all of the programs in place already. Germany can't cut defense spending very much, they have been bare bones in that department since WW2.
    Looks like Early Adopters will need to pay the price.

  8. The only way to rapidly accelerate the penetration of electric cars is to mandate it. Otherwise the auto manufacturers will not jeopardise their core business and will continue to prioritise their core business. I am not normally in favour of such draconian measures, but the free market will not - and the governments cannot - sufficiently incentivise EVs in the short term. Meanwhile, oil supply, energy security and climate change are fast becoming a 'clear and present danger'. Time to stop sleepwalking into a very nasty situation that will really piss off our children.

  9. I was under the impression that the Nissan Leaf was built as an EV from scratch and there is no ICE Leaf equivalent.

  10. For the record, Dieter Zetsche is commenting on the German market and ONLY the German market. Having familiarity with this market gives him some credence in his comment. Now unless you are familiar with or experienced in the German market or Germany for that matter, you should refrain from deriding Herr Zetsche. There is a culture and infrastructure in Germany that places purchasing a new EV [over other options] at a large disadvantage, unless you do something as Herr Zetsche is suggesting.

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