The German car industry's political muscle | DW Documentary

a source of national pride in germany cars stand for freedom status and german engineering our prosperity today is inconceivable without the car and without the car our prosperity tomorrow will not be possible the car is the engine of the german economy an industry that employs millions car makers have long enjoyed a special relationship with politicians the message is the car stands for germany it must be protected sacrifices are made in the interests of the auto industry large corporations influence politics in germany and in europe the german chi industry has traditionally been very powerful in in brussels they take disproportionate interest control and influence but the biggest fraud scandal in recent history has tested the cozy relationship between car makers and politicians i'm extremely angry the mood is shifting many are calling for fundamental change at the same time new competitors are entering the market especially from china if we keep doing the same old stuff we'll wake up in a world where germany is no longer an industrialized country in the middle of dealing with this credibility crisis the auto industry is dealt another heavy blow covid 19. sales have slumped assembly lines are at a standstill the outlook is poor without firm political backing the industry could be headed toward an uncertain future is the era of the german automobile coming to an end [Music] stuttgart one of the most important automotive hubs in germany here people have long depended on local car makers and their suppliers for their livelihoods but past successes aren't worth much today as dieter cecha warned shortly before stepping down as ceo of daimler no law of nature says daimler will exist forever roman sitzelsberger believes the consequences would be devastating he's the district manager of the german metal workers union ig matal in baden-wurttemberg on november 22 2019 the union rallies to protest recently announced job cuts today i stand here in stuttgart looking out at 15 000 metal workers who are saying boss this is not the way to do it four months before the coronavirus pandemic shuts down europe many employees already fear for their future more than 500 000 people work in the automotive industry in baden-wurttemberg [Music] it's a whole system that's affected suppliers prefab development and that doesn't include the baker the butcher the hairdresser the retailers the list goes on and on it's clear that without these industries the lights will go out car manufacturers and suppliers are in a difficult position their business model is shaky many companies have few answers to the myriad challenges of the future job cuts are one way to reduce costs now they're saying we'll get rid of some employees now and we might need new people elsewhere in reality it's about cutting costs and saying i'm no longer doing this here in germany i'm doing it elsewhere workers not only blame auto executives for failing to find innovative solutions they also hold politicians responsible politicians are reacting far too late they always support the automakers who are actually responsible for the problem they should be ensuring our jobs are safe auto industry employees are often weighed down by insecurity and existential fears germany the nation of cars is also plagued by self-doubt the germans and the automobile share a long emotional history at the end of the 19th century carl bentz and gottlieb daimler lay the foundations of what would become the automotive era the internal combustion engine is the flagship of german engineering following the second world war cars are mass-produced suddenly after years of hunger deprivation and war there was you this opportunity wherever you wanted and you could afford to do it with your own car suddenly the world was open politicians commit fully to nurturing the auto industry building roads was cheaper than expanding public transport in the 1950s there was so much faith in technology and the future that people said we're going to rebuild the city they made this car-oriented city with wide roads easy access for cars they tore down neighborhoods to do it the whole country is rebuilt with cars in mind when problems arise politicians step in to help during the 2008 financial crisis the government introduces an environmental bonus to help the industry we have our hands full here we've got deliveries every day up to 20 vehicles 5 billion euros exclusively for the auto industry the relationship between car makers and politicians is a close one and fostered by former german chancellors for decades being a car country has been part of germany's self-image that drivers have freedom on the roads that car companies do their business here this idea has actually grown in importance over time in 2019 more than 800 000 people were directly employed by the auto industry but the mechanical engineering metal working and textile sectors all benefit from the high volume of orders from car makers too an estimated two million people depend on the auto industry for work that's nearly one in twenty of germany's working population this club is clear why the car plays such a central role for us when it comes to politics automakers have long enjoyed a special status the automobile industry is especially close to my heart in terms of industrial policy it's perfectly clear the automobile is the lifeblood of germany and bavaria the auto industry is key in germany we have a great responsibility for the many jobs that depend on it for years political decisions that benefit the auto industry have been made not only at the federal level but also in the eu parliament the environmental organization transport and environment campaigns for sustainable transportation in europe julio poliskanova advises parliamentarians for the organization she sees the effects of the auto lobby's influence on a daily basis i think for many many years what we have seen working here in brussels is that there is really a lot of protectionism on behalf of the german government towards the industry protecting the auto industry often comes at the expense of the environment in 1999 the eu wants to require manufacturers to take back obsolete vehicles germany's environment minister green party politician jurgen tretin supports the plan however it would be very costly for the car makers car chancellor gerhard schroeder intervenes in a turnabout train abstains from the vote in brussels the motion fails the arguments put forth by the automotive industry are of such great importance for the chancellor but he has changed sometimes it really feels that the government is in the pockets even of of the german manufacturer and a lot of the time the german government has intervened and really supported the business interests of their manufacturers here in in brussels in eu decision making [Music] christina dexvert works for lobby control an organization investigating the influence of the auto industry on the german government [Music] this is the vda the german association of the automotive industry one of the most powerful lobbies right here in the government district it's a stone's throw to the chancellor's office which means easy access to politicians the major german automakers also position themselves close to the bundestag the german parliament bmw volkswagen and the vda and of course daimler a short walk from the german parliament is the volkswagen group [Music] forum the group representation is located upstairs that's really the lobbying office so they exert influence on the government from here mr steek former government spokesman for both schroeder and mackel works here michael janzen heads the office he used to head mackel's office you can see the relationship between politics and the car lobby is very close long-standing relationships give auto lobbyists special access to government personnel auto industry people go in and out of government offices they're on a first name basis they have a tight relationship closer than in almost any other industry here top politicians regularly move on to jobs in the auto industry one prominent example matthias visman he was a former federal transport minister for the center-right christian democrats and a member of parliament for more than 30 years after leaving parliament he became the chief lobbyist for the vda his letters to the chancellor begin with dear angela maximilian scherbel formerly the press spokesman for the christian social union now the chief lobbyist at bmw and eckart von klayden a member of the christian democrats federal executive committee in 2006 he was the party's federal treasurer [Music] in september 2013 fond clayton was serving as minister of state in the chancellor's office two months later he became the chief lobbyist at daimler signed his employment contract with daimler while he was still working in the chancellor's office you have to ask do his interests already lie with his future employer or is he still making decisions for the common good which is the job of a politician lobbying is a permitted part of the german democratic tradition what is unusual about the auto lobby is that it's consistently staffed by high-ranking ex-politicians hildegard miller the vda's current president is no exception as angela merkel's former minister of state she's well connected to the chancellor's office shortly before the outbreak of the coronavirus pandemic she is seen as a beacon of hope someone to lead the auto industry out of the crisis her annual salary at the vda more than one million euros former top politicians demand high salaries and only the large corporations can afford that hardly any environmental association can afford a top politician as its chief lobbyist are environmental and societal interests falling by the wayside who is politics for at the federal transport ministry in berlin parliamentary state secretary stefan bilger tries answering the question there are various legitimate interests that includes employees in the automotive industry as well as residents who want clean air as a ministry we're of course tasked with reconciling all of these different legitimate interests and that is what we are trying to do here day in and day out and what of environmental interests in the transport ministry in 2019 german transport minister andrea schuyer met 11 times with representatives from the automotive industry despite requests he did not meet once with environmental groups and this is a huge imbalance and shows what mr shoya stands for he stands for protecting the german car industry not the environment and consumers unilateral government support has shaped german industry policy for many years since the late 1990s parliamentarians have discussed stricter limits on co2 emissions but instead of concrete rules they decide voluntary measures are enough the former environment minister defends the decision a voluntary commitment aimed at a reasonable goal is not bad simply because it's voluntary the question is if the goal will be achieved and if it is there's no need to bring out the most torturous tools of persuasion it quickly becomes clear that the industry is falling far short of its co2 reduction targets the car industry the car sector in europe for example is one of the biggest contributors to co2 emissions so we have to go faster and the car industry has to go faster but instead of preparing on time investing and enrolling our technology they prioritized profits in the good years the years where they didn't have any regulations to meet meanwhile the issue of climate change grows more serious every year in 2007 angela merkel now chancellor of germany speaks out in favor of ambitious eu climate targets but in 2013 when political groups in the european parliament agree to drastic cuts in co2 emissions from passenger cars merkel intervenes the car industry in germany some of the larger manufacturers were not happy with the agreement so merkel came to brussels with a mission to weaken and adjust the regulation to their needs the text of the new law has already been approved by member states the vote should be a mere formality yulia poliskanova is there when at the last minute the plan is stopped in its tracks to all be called up by the council to say we're very sorry but the agreement no longer holds we have to renegotiate and there was an outbreak in the room members of parliament were saying but this is unprecedented we just agreed you gave us your word so that was a real scandal in european decision making [Music] after tough negotiations a compromise is reached car manufacturers can count especially fuel efficient vehicles several times toward their overall balance using so-called super credits the strict limits have been eased angela merkel is pleased with her success [Music] that's not the case in all eu states and you can see from the votes at the european level that there are different approaches based on how each industry is shaped but the idea that we are somehow putting on the breaks is wrong protecting the interests of one's own industry is a legitimate political goal but has it gone too far in germany in 2015 the u.s environmental protection agency discovers illegal software in vw diesel cars the software manipulates data related to the emissions of nitrogen oxides which are especially hazardous to health it's the biggest fraud scandal in germany's recent economic history and all the major manufacturers are implicated the auto industry apparently feels very secure in germany the government hardly intervenes and always shields them from consequences so that creates the breeding ground for something like the emissions scandal the diesel scandal plunges the auto industry into crisis and prompts environmental protests the mood shifts i'm extremely angry volkswagen is parting ways with audibos rupert prosecutors are investigating stadla in the diesel scandal prosecutors say there is danger of collusion a turning point for the entire industry journalist and consultant don dalman has been covering the automotive industry for many years don't forget not only the german government but all of us the taxpayers fund research in the automotive industry a lot of money was invested in the development of hydrogen fuel and electromobility over the last 10 years and nothing came of it so politicians got angry but politicians also shoulder some blame the german car industry slept through important innovations being made elsewhere in the world for years economic interests were prioritized over the environment and public health it's a high price to pay road traffic today accounts for about one-fifth of all co2 emissions in germany the federal government has never been interested in sustainable mobility car summits were not a place where that was celebrated instead it was about safeguarding what already existed what kind of industrial policy can reconcile the needs of the environment and the economy it's a question that's of existential importance for a place like stuttgart the city's former green party mayor fritz kuhn has unique insight into the conflict between these interests ultimately the government's job is to determine emissions limits for co2 nitrogen oxides and so on and the automotive industry's job on the economic side is to provide the best vehicles on time but the best doesn't just mean the fastest and biggest it also means environmentally friendly vehicles for decades made in germany stood for innovative manufacturing but more than five years after the diesel scandal the transport ministry is reviewing its policies with a critical eye opportunities for innovation have been missed sometimes by politicians but also by car makers now it's up to them to bring these innovative vehicles to market the iaa international motor show september 2019. the automotive industry's message is clear car companies are turning over a new leaf volkswagen plans to switch entirely to battery-powered vehicles by 2040. daimler and bmw are also focusing on battery powered vehicles but they promise to develop other driving technologies as well but change takes time daimler estimates that its fleet of new passenger cars will not be completely co2 neutral for another two decades that may sound like a long time but in fact it's only three product life cycles and it's not much time when you consider what a huge transformation it is for us many have long since lost confidence in the car companies outside the halls of the iaa 25 000 people demonstrate for change they want a mobility revolution that cuts out fossil fuels and the influence of big corporations [Music] the diesel scandal cast this iconic product the car in a completely different light and it intensified people's awareness of environmental issues like guys this climate change thing it's no joke it has to be taken seriously one day we'll look back on this period and understand it was a time of epochal change amid this transformation disturbing news about a new virus in china starts to circulate we now have a name for the disease it is kovid 19 and i will spell it c o v i d hyphen one nine but it will still take time to understand just how hard this virus will hit worldwide in stuttgart in february 2020 the threat is not yet felt at daimler management and engineers are working hard to make up for lost time ceo orlo colenius is steering the company through a difficult time the transformation of the auto industry is causing a lot of internal upheaval which affects our company too we're investing huge amounts in electro mobility digital technologies new business models at the same time in order to be able to finance these new investments we have to significantly improve our cost efficiencies the company plans to invest more than 10 billion euros in the development of new vehicles but daimler is still struggling with the fallout from the diesel scandal litigation costs fines penalties product recalls all these go on the balance sheet in the negative column [Music] in order to be as cost efficient as possible cuts are made to personnel we've outlined a plan and set clear targets we're not cutting with a lawn mower we're spreading cuts intelligently in different areas our goal by the end of 2022 is to save 1.4 billion in personnel costs [Music] 1.4 billion euros even before the pandemic as many as 15 000 jobs are at stake major suppliers also want to cut thousands of jobs past mistakes are taking their toll the deutsche automobile industry for many years the german automotive industry did not take the environmental movement seriously enough they have their quarterly reports on the stock exchange but they were not sustainable in an ecological sense now that's coming back to bite them because the electric car that people always talk about isn't really here yet in fact the race for new driving technologies is taking place primarily outside germany in china subsidies and purchase premiums drive technical innovation in 2016 the chinese government makes a decision with far-reaching implications china wants to force automakers to make a production quota for e-cars failure to comply could result in heavy penalties this puts pressure on german manufacturers for them china is the most important market nearly one in three cars is sold there [Music] the germans were once the industry's pioneers now they find themselves on the sidelines other players are making the rules who runs the world market china if we keep doing the same old stuff we'll wake up in a world where germany is no longer an industrialized country china is on the rise just days before the coronavirus brings the country to a standstill people here are confident nearly 500 electric car manufacturers are registered in china in 2019 one of them is neo in hufei thousands of electric vehicles roll off the assembly line here every month the automaker is building suvs for the premium market vehicles designed to compete with daimler and bmw so how to compete with these traditional yams with more than 100 years of history they have accumulated a lot so battery car itself is a little bit less complicated compared with the oil one that gives us a chance so you see bodies come from that tunnel on the second platform victor goo heads production at neo he says the company's success would have been impossible without political support they are supporting on build up the charging stations because this charging station environment actually is one of the key factors for customer to choose between the traditional all your car or a battery car victor goo says china's targeted promotion of electromobility could be decisive in the end german friends should think about we need to put focus on that otherwise china will run very fast in in that in that way i think by 2017 china already has 190 000 public e-mobility charging stations in germany at the same time there are just 9 500. [Music] the fact that alternative driving systems have been ignored for so long in the birthplace of the automobile frustrates even some german developers china welcomes them with open arms former bmw executive danielle kischert co-founded his own car brand in 2017 biten electric vehicles for the premium class i think germany has spent a long time trying to keep diesel cars afloat and that's the question do you see change as a threat or as an opportunity as a startup we of course see a huge opportunity in this kind of challenge we can basically start from scratch with a blank sheet of paper here a pioneering spirit full of optimism the former giants of the industry have some catching up to do three four five years ago we were in absolute denial about electromobility i think people had gotten a bit too comfortable with their own success danielle keshert believes the future of electromobility is here in china this is due in large part to chinese industry policies we built this plant here in 18 months as i like to say at chinese speed with a lot of support from the local government there's simply a determination here to drive this change forward quickly and speed is crucial because the competition is fierce if you really want to seize an opportunity you have to be fast you have to get in during this short window of time and carve out a spot in january just before the coronavirus lockdown 340 robots stand ready and waiting for their first shift some 300 000 vehicles are expected to roll off the production line here each year german engineering made in china china has introduced a very good subsidy policy but what you're shown always looks pretty what the actual working conditions are like especially at the level of the suppliers is another thing altogether this is an industry politically it's an industry policy that is ruthless it does not take social or cultural aspects into consideration that's why i'd never consider it a model that's transferable or even worth striving for it china's communist leadership is pushing ahead they want change not compromise the german government also says it wants to put e-cars on its roads the goal one million by 2020 not even a third of this was achieved [Music] politics certainly has a major influence because we set the conditions then the manufacturers have to implement them but in the end it all depends on the customer so if customers don't accept change it'll be difficult demand for electric cars in germany falls far short of expectations is it the customer's fault the customer always has a say that's always true as the customer i'm actually a little bit the king because i can actually steer the industry i don't agree with the industry's point that the customer is the chooser user is the user as as they say so i would say if the car industry put the same marketing power they do today uh on suvs towards clean zero emission vehicles their sales would also boom in the eu pressure is growing on automakers to start driving change the diesel scandal weakened these companies position those who fail to comply with emission limits in the future will face costly penalties the car lobby nonetheless continues its efforts to influence political decisions in favor of the internal combustion engine karimadeli is a french green party politician and a member of the european parliament she chairs a committee on transport and tourism when implementing stricter environmental regulations she often encounters pushback from the auto industry a favorite tactic of car lobbyists using exemptions to circumvent emissions limits that are already in place that was the case in january 2020 when the emissions limits for nitrogen oxides was discussed at this committee meeting europe implemented the euro 6 standard in 2007. but thanks to the diesel scandal we discovered that in fact the euro 6 standard was not being met by car manufacturers in 2017 the eu introduces more realistic emissions tests this is a problem for german auto manufacturers whose vehicles cannot pass muster when tested fairly in this case eckhart von clayton immediately turned to his government contacts he wrote emails he called the chancellor's office and he said this is not the way to go it's too fast for us we need different limits he essentially put the brakes on and email exchanges have since become public which show how the chancellor's office reacted that was in october 2015 when they simply said you don't know how to meet the standards don't worry you can exceed them by 110 until 2020 and then by 50 after 2020 karima delhi wants to get rid of the exemption european standards are very ambitious but if you look at the standards in the us and in japan they are actually twice as strict as us especially for nitrogen oxide emissions more than 600 000 premature deaths in europe are due to nitrogen oxide emissions nonetheless in summer 2020 it looks like the exemption for excessively high nitrogen oxide emissions will remain in place a short-term victory for the industry the eu plans further restrictions on pollutant emissions to meet the 2030 limits sales of e-cars will have to increase more than 10-fold then without warning covet 19 strikes sending the auto industry into turmoil and threatening its very existence the near global shutdown plunges the world economy into its worst crisis since world war ii sales have slumped assembly lines are at a standstill the outlook is poor germany's automakers are hit full force what happened was incredibly serious all the existing problems with the industry's transformation were again laid bare and we're now realizing we're in one of the deepest crises that i've personally experienced it's something we've never seen in germany and never had to face in the auto industry in china the pandemic is also hitting pioneers of e-mobility biden was considered one of the most promising electric car startups in the summer of 2020 its financing dries up the company lays off almost all of its employees whether or not cars will ever roll off the production line here in nanjing is an open question germany's automakers turn to politicians for help millions of jobs are at stake would consider the idea of providing incentives for consumers the industry receives backing from the premiers of germany's automotive states but more than 60 of germans reject the idea of subsidizing the purchase of a new car environmental groups call for a fundamental change in transport policy a change in attitude that's felt even in the halls of the federal government in june 2020 the german government decides on a coronavirus stimulus program without the auto industry's input and with it this surprise we couldn't simply put together an economic stimulus package which is what is classically done it has to be a package that looks towards the future going against the car lobby's wishes the package includes no generous subsidies for the purchase of diesel and gasoline engines for the automotive industry it was really quite a blow and i don't think they expected it i think this is the most visible sign that something is changing in the relationship between politics and cars what impact will this have on germany's car industry roman sisselsberger fears those calling for change will be left in the lurch this is it's mine that's my biggest concern now that because of the economic pressures and risks facing these companies the whole issue of alternative solutions might stall again i'm afraid the depth of the crisis will result in companies disappearing from the market and then the whole system might start to wobble how dependent is germany's economy on the well-being of the automotive industry scientists from the economic research company prognos study this question in 2018 ceo christian burlhoff explains the automobile industry the automotive industry is in a decisive phase right now due to various issues particularly the technology shift towards electromobility we must ask the question what is the future viability of the german auto industry to answer this the researchers sketch out two possible scenarios in one the german automotive industry masters the challenges ahead and the other scenario is one in which the german automotive industry fails to do so or at least fails to do so comprehensively and there is reason to at least consider this possibility if german automakers do not manage to innovate they could face a bleak future according to prognos the automotive industry would shrink by about 40 percent by 2045. one in three jobs in vehicle manufacturing would be lost which would have repercussions for the entire german economy one question is what is the impact of 500 000 fewer people working in a sector that's significant but you can also see that the entire german economy doesn't immediately go down the drain i think that's something that's important to understand even if the automotive industry were to suffer such massive losses the study forecasts a relatively moderate overall loss of economic output 4.6 percent by 2045. the short-term impact would be considerable long-term however looking back at the country's economic history gives cause for hope [Music] in the last 40 years we've had all kinds of industries in germany that became world leaders then died out the textile industry the chemical industry consumer electronics do we see these losses reflected in the development of the gross domestic product no because each success led to other strengths and lifted other sectors of the economy and over a period of 20 or 25 years i can basically imagine something like that happening in the automotive industry without these places suffering any substantial damage a comforting prospect even without the renowned auto industry there's still hope for prosperity and jobs in germany but it probably won't reach that point germany may be behind when it comes to e-mobility but the car industry is still counted among the most innovative in the world and it has a good chance of catching up where will germany's car companies be in 10 years germans are known to produce the best cars in the world and i really really hope that in five or ten years time germany will transform transition and will be producing the best electric cars in the world roman setzelsburger is also optimistic despite the pandemic i'm still fundamentally convinced that the auto industry in germany will get its act together the optimism is only justified if top executives quickly realize that climate protection is not an afterthought but a major undertaking of the next 20 years i hope they'll get their act together survive this transformation and move forward bravely and that will still have a european auto industry in 10 years time christina deckviet hopes to see a shift in the relationship between the automotive industry and politics in 10 years i would like to see the auto industry embedded in a broad democratic social discourse standing for a mobility policy that is oriented toward the common good mobility state the year 2020 will go down in the history of german industrial policy as a turning point it's the year the german government decided that while the car may be important it's no longer more important than everything else

Channel: DW Documentary

Views: 585,281

Keywords: Documentary, Documentaries, documentaries, DW documentary, full documentary, DW, documentary 2021, documentary, car, automotive industry, crisis, covid 19, pandemic, coronavirus, car industry, Germany's car industry, German cars, German car industry, cars

Id: cGZ78J6AqVc

Length: 42min 25sec (2545 seconds)

Published: Fri May 07 2021

Reddit Comments

[u/lowrankcluster]

Your title is misleading. Auto industry is the core of German economy, so obviously there will be political influence. Also, if Germany intentionally tries to hurt NIO, VW Diamler and Audi can say bye bye to their largest market.

[u/rkay0820]

Good Find Good Video Sums up the many reasons for owning NIO