The history of the automobile is inextricably intertwined with that of Germany. In fact, the Benz Patent Motor Car, model No. 1 is widely considered the first automobile, marking man’s transition from horse-drawn buggies to automobiles.
Built by German engineering genius Carl Friedrich Benz, who is also credited with building the first stationary gasoline engine — a one-cylinder two-stroke unit that debuted in 1879 – this vehicle was patented on January 29, 1886. In effect, this patent – number 37435 – can be considered the birth certificate of the automobile. Just over a decade later, another German wizard by the name Ferdinand Porsche unveiled a new kind of car at the Paris World Exhibition in 1900.
Called Lohner Porsche, it was an electric car with wheel-hub motors driving the front wheels. Also in 1900, Porsche designed the world’s first functional hybrid car, the “Semper Vivus”, thus laying the foundations for electric and hybrid electric mobility.
More than a century later, when the world is on the cusp of an electric vehicle revolution, there is no wonder that German brands, including those established by these prodigies are at the forefront of technological innovation and advancements. There is no denying the fact that German automakers have lost considerable ground to Tesla as they took their sweet time to decide on joining the EV party. But what they bring to the table is something that Tesla does not have. It is flawless heritage, unmatched experience, and the legacy of more than a century of customer goodwill.
However, it was not as simple as deciding overnight to make EVs and jumping on the bandwagon. These automakers came under immense pressure from the European Union towards the end of last decade when aggressive emissions standards were announced, requiring them to cut their emissions footprints by 38 per cent between 2021 and 2030.
In response, Germany’s automotive industry announced an investment of over 40 billion euros ($45 billion) in electric vehicles over three years starting 2019 and to triple the number of all-electric models in their line-ups. Challenges abound including record outlays for a payoff that could be years away, and resistance from customers wary of high sticker prices, limited driving ranges and sparse charging infrastructure.
Moving away from the combustion engine also poses other fundamental challenges to the industry and German economy as such. The German automotive industry employs nearly one-tenth of the country’s population and generates nearly 380 billion euros in revenue, approximately two thirds of it from exports. This makes the automotive sector one of the most important industries in Germany and also accounts for 25 per cent of all passenger cars produced in Europe. Keeping this in mind, Germany is making sure that embracing electric mobility is a joint effort by policymakers and the automotive industry itself.
Three years on, German behemoths like Volkswagen Group, which includes Porsche, Audi, Skoda and several other brands, have made incredible progress on the EV front. In fact, last year, the Group sold more EVs than Tesla in its home market of Europe.
Although Tesla still leads globally, the VW group stands a better chance than most others in catching up with the disruptive Silicon Valley brand. By the year 2030, VW is aiming for at least 70 per cent of its European revenue to come from electric cars, while in China and North America, its goal is at least 50 per cent of revenue from EVs. VW’s early success in the EV market can partly be attributed to its huge legacy customer base, who prefer not to take risks with upstart brands when it comes to new technologies and go with established players instead.
The same is happening with the higher end luxury segment of the German EV models, from brands like Audi, Porsche, BMW and Mercedes-Benz. Audi with its E-Tron range of all-electric vehicles, Porsche with the Taycan range, BMW with its ‘i’ series, and Mercedes-Benz with its EQ range of EVs, are revolutionising the way electric mobility is seen by infusing unprecedented levels of luxury and opulence into the sector.
And it isn’t just luxury that these brands are focusing on.
They are also making serious breakthroughs in terms of battery technology that is vital to an electric car’s success. Mercedes-Benz has been pushing the boundaries of electric range with their Vision EQXX research electric car. In April 2022, a Mercedes-Benz electric car drove more than 1,000 km (621 miles) from Germany to the French Riviera on a single charge, stealing the technology thunder from Tesla. Mercedes took things to the next level just a couple of months later in June when the EQXX prototype managed to travel nearly 1,200 km (750 miles) on a single charge, beating every electric vehicle on sale today.
Tesla’s longest-range vehicle, the Model S, does 400 miles per charge, according to EPA estimates, while Lucid Motors, the latest EV startup to launch a vehicle, has its Air sedan rated to travel 520 miles between charges. Better still, Mercedes said it had the air conditioner, a big drain on a EV’s battery pack, running for about eight hours of the total drive of 14.5 hours.
All these point to the fact that the German auto giants are in the EV game for the long haul and are focusing as much on technology and efficiency as they are on providing a characteristically premium ownership and driving experience. And if recent reports are anything to go by, the shift to electric mobility has not in any way diminished the perception or global standing of these brands.
According to the Brand Finance Global 500 2021 ranking, German auto brands continue to dominate the world’s most valuable auto brands despite the harsh effects of the coronavirus crisis on the auto industry. The ranking says the country’s auto industry leads with a cumulative brand value of $201.8 billion. Mercedes retains its position as Germany’s most valuable brand across all industry sectors, with VW, BMW, Porsche, and Audi all occupying spots in the global top 10 most valuable auto brands.
According to the ranking, German companies in the top 10 have a combined brand value of $197.2 billion – equivalent to a whopping 54.7 per cent of the top 10 most valuable auto brands.
So, while retaining the highly cherished values of innovation, reliability, safety, and design that made it the world’s favourite over the past century, German automobile industry is carving a new path for itself in the burgeoning world of electric mobility. After all, it is only fair that an industry that gave the world its first car and the first electrified vehicle stakes a claim for its preeminent spot in the global automotive map of the future.
