2004 Mercedes Benz G500 G Wagon on 2040-cars

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Automakers face reality of EVs' cost — to jobs, and their bottom line

Related: We obsessively covered the Frankfurt Motor Show — here's our complete coverage FRANKFURT, Germany — European car bosses gathering for the Frankfurt auto show are beginning to address the realities of mass vehicle electrification, and its consequences for jobs and profit, their minds focused by government pledges to outlaw the combustion engine. As the latest such announcement by China added momentum to a push for zero-emissions motoring, Daimler, Volkswagen and PSA Group gave details about their electric programs that could give policymakers some pause. Planned electric Mercedes models will initially be just half as profitable as conventional alternatives, Daimler warned — forcing the group to find savings by outsourcing more component manufacturing, which may in turn threaten German jobs. "In-house production is almost irrelevant to the consumer," Daimler boss Dieter Zetsche told reporters on the eve of the Frankfurt Motor Show, in the midst of a German election campaign in which automotive jobs have loomed large. The company set a target of saving 4 billion euros ($4.8 billion) by 2025 to help fund the cost of its electric cars. "Daimler is the first company to state explicitly how much electric vehicles are going to hurt margins," said Bernstein analyst Max Warburton. "It was brave to go first — but of course it won't be the last." Volkswagen, for its part, said it was seeking new global supplier contracts to source 50 billion euros ($60 billion) of electric car content including batteries, which are not yet manufactured competitively in Europe. "A company like Volkswagen must lead, not follow," Chief Executive Matthias Mueller told reporters. VW diesel emissions-cheating exposed by U.S. regulators in 2015 triggered global public outrage, dozens more investigations into test-rigging by the wider industry and a push by some lawmakers to ban diesel and eventually all engines. TIGHTENING NOOSE Tesla shares jumped nearly 6 percent on Monday after a Chinese minister said it was a question of when, not if, Beijing bans fossil-fuel cars, tightening the noose around the combustion engine. France and Britain have promised its outright abolition by 2040. But PSA, the maker of Peugeots and Citroens, said it was concerned about the risks if consumers were left behind in the rush, and a new generation of battery cars does not sell.

Daimler chairman agrees with German Greens on reducing emissions

Daimler Chairman Dieter Zetsche spoke at a Green Party congress in Germany earlier this week and said he agreed with the party's urge to dramatically cut transportation-based greenhouse-gas emissions by expanding plug-in vehicle sales, Reuters says. Zetsche stopped short of backing the Greens' suggestion to ban gas- and diesel-powered vehicles by 2030, though. The man must keep his job, after all. Zetsche did say that reducing greenhouse-gas emissions from the transportation sector was "necessary," and his company has made plans to do just that. Daimler representatives said at the Paris Motor Show earlier this year that Smart and Mercedes-Benz both planned to debut more than 10 electric vehicles within the next decade, and that plug-ins may account for as much as 25 percent of Mercedes-Benz's sales by then. Moreover, Dr. Thomas Weber, Head of Group Research and Mercedes-Benz Cars Development, said in June that Mercedes could be selling as many as 100,000 EVs a year by the end of the decade. Last month, Mercedes-Benz announced that its EQ electric-SUV concept would go on sale by 2020, and that the Bremen factory that's producing the model will broaden its plug-in vehicle production further. Zetsche's cautious support notwithstanding, the German government appears to be doing its own part to reduce emissions from the country's light-duty vehicles. Earlier this year, Germany enacted a plan that provides as much as 4,000 euros ($4,270) in perks for people who buy new electric vehicles, with German automakers agreeing to foot about half of the estimated $1.4 billion bill. German lawmakers had also floated the idea of a 10-year moratorium on electric-vehicle taxes for cars purchased before 2020. Related Video: News Source: Reuters via Automotive News Europe-sub.req.Image Credit: Ralph Orlowski / Reuters Government/Legal Green Mercedes-Benz smart Electric

2015 Spanish F1 Grand Prix makes its Deutsche mark

The first race of the European Formula One season inaugurates the second phase of the Championship. Teams overhaul their cars with the big updates they've been working on since Australia, and at the end of The Battle of Spain we find out how the positions on the field have changed. Mercedes-AMG Petronas driver Nico Rosberg brought a big update to his psychology, straight-up beating teammate Lewis Hamilton to take his first pole position of the season. Mercedes owns the front row and Ferrari maintains its status as primary challenger, Sebastian Vettel lining up in third. Williams proved it's been hitting the books to do better in class, though, Valtteri Bottas slotting into fourth. And Toro Rosso's visit to a track that rewards strong aero rewarded them with the best team grid position since the Italian Grand Prix in 2008: Carlos Sainz secured fifth, ahead of Max Verstappen in sixth. Kimi Raikkonen's bout of Saturday woes – it seems the Finn is always handicapped by lots of tiny issues – continued in Barcelona with one of his sets of prime tires getting cooked by malfunctioning tire warmers. He recovered well enough to take seventh on the grid, but he's got some strong competition ahead of him. He led three other drivers in the Continuous Issues department, Daniil Kvyat unable to wrestle his Infiniti Red Bull Racing higher than eighth, Williams driver Felipe Massa getting it wrong in Turn 3 to fall five places behind his teammate Bottas, and Daniel Ricciardo in the second Red Bull enduring another engine change and sloppy car behavior to get tenth. And while it turned out to be a steady race a little rough around the edges, the positions on the battlefield just might have changed. A little. Of the 66 laps in the race we might have seen Rosberg for three of them – maybe. The German got a smashing start, had a clear lead into Turn 1, and after that we checked in occasionally during his two pit stops and again at the checkered flag. He owned the entire weekend the way we're used to seeing his teammate do, and the cameras left him alone to run his race. No one got within seven seconds of him during the first third, and as the pit stop strategies played out that cushion grew. He finished seventeen seconds ahead of Hamilton, and 45 seconds ahead of third-placed Vettel. Hamilton, on the back foot all three days, stumbled out of the gate.