Volkswagen AG and Mercedes-Benz AG have failed in the electric car market
Volkswagen AG and Mercedes-Benz AG have failed in the electric car market
2022.11.19 12:17
Volkswagen AG and Mercedes-Benz AG have failed in the electric car market
Budrigannews.com – The German auto industry has bid to take away the crown of electric cars from Tesla Inc. Volkswagen AG and Mercedes-Benz AG veered off course this week in a stumble.
According to a person familiar with the situation, VW has also cut the price of its flagship EQS EV in China by about $52 billion ($54 billion) this week after software buzzed, questioning the ambitious €33,000 EV rollout touted as the industry’s largest. Shares fell as much as 7.2%.
The development is a red flag for an industry that is pouring unprecedented money into the transition with an ambitious timeline. Automakers around the world are working on switches away from combustion engines, but the stakes are high for a German manufacturer accustomed to commanding a premium based on state-of-the-art technology and luxurious trim.
“The German automaker has announced bold electrification targets and claims to be leading the transition, but it has not yet materialized,” said Michael Dean of Bloomberg Intelligence. “They still have a long way to go.”
After years of failed attempts to replace Tesla, with Chinese start-ups preparing their moves, the German carmaker has switched gears to win the EV race, away from making incremental changes to their combustion-engine cars that have dominated for decades.
BMW, Mercedes and VW hope to scale up an entirely new infrastructure of assembly platforms, battery plants and software to deliver a new generation of EVs, these are to lead to digital products that tap the driving range as well as new revenue streams and shut out high-tech rivals .
“From a hardware perspective, there’s no doubt that they can make excellent cars,” said Axel Schmidt, global head of automotive at Accenture. “But can the complexity and quality required for software be mastered by hardware manufacturing with a 120-year history?” I’m not so sure.”
This week’s development is a delicate development for Mercedes because VW re the strategy set by former chief Executive Herbert Diess, who was replaced by Porsche Head Oliver Bloom and May after a number of setbacks, the struggle with the finest EV models in China plans to be as electric only as possible by 2030.
With VW, the fallout could also be widespread. If the delay in the Trinity battery car project beyond the original 2026 is confirmed, the automaker could scrap plans for a €2 billion plant in Germany, which also means that the VW brand will lose the opportunity to close the technological gap with Tesla, especially in autonomous driving capabilities.
The delay in the Trinity project stems from a well-documented struggle at Volkswagen’s software development unit, Cariad. The subsidiary is already plagued by confusion and mismanagement that had pushed back the release of Audi Artemis – the company’s extravagant answer to Tesla – by 2027 by 3 years.
“Bloom is clearly reevaluating the entire battery-electric vehicle and software strategy, so 2026 will be the earliest time VW can challenge Tesla,” he said.
With any trinity delay, Volkswagen has been forced to invest more in its MEB platform, which is the basis of its ID electric car series These cars have been plagued by software problems, such as sudden braking from a faulty traffic detection system and the driver’s car display being seized.
Cariad now focuses on finishing the new software architecture for premium models of Porsche and Audi, enhancing the Trinity Project and improving the quality of the car itself.
“It looks like the Germans are tripping over themselves a little bit these days,” said Matthias Schmidt, an automotive industry analyst based in Berlin. “Inherent perfectionism can be their own worst enemy, slowing them down in a fast-paced EV environment.”
