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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 names Bernd Pischetsrieder to supervisory board

Some executives in the automotive industry stay with one company for their entire careers, while others bounce from one to the other, often leaving their indelible mark on each automaker at which they serve. Bob Lutz is certainly an example of the latter. So is Lee Iacocca, having presided over Ford and later charing the Chrysler board. Carlos Tavares was chief operating officer of Renault before being nominated as chief executive at PSA Peugeot Citroën. But as far as the Germans go, nobody's jumped from the leadership of one automaker to the next quite like Bernd Pischetsrieder - especially now that he's been named to the supervisory board of Mercedes-Benz parent company Daimler.
An engineer by training, Pischetsrieder started his career at BMW in 1973, eventually rising to the office of CEO after twenty years. There he remained until 1999, only to be dismissed after orchestrating BMW's takeover of the Rover Group (of which only the Mini brand remains in the company's portfolio, the other brands having been sold off after his dismissal).
The next year he was named chairman of Volkswagen's Seat brand, and rose to the chairmanship of the entire Volkswagen Group two years later. Despite a largely successful four-year tenure (that gave birth, incidentally, to the Bugatti Veyron), disagreements with supervisory board chairman Ferdinand Piëch saw him leave the helm at VW AG, focusing his attention on the Scania truck division. He's since been touted as a potential chief executive for Opel and for Continental, but neither potential was apparently realized.

Brabus bringing 900-horsepower Mercedes S65 to Geneva

The S-Class may be the ultimate Mercedes, but what's the ultimate S-Class? Is it the S550? Maybe in some markets, but that's just the starting point in North America. The S600? Getting closer. The Maybach? Sure, if the last word in luxury is what you're after. But if it's performance you crave, then you'll want an AMG version like the S63. But even that's not the flagship. No, in terms of outright power, it all comes down to the S65. It's got a 6.0-liter twin-turbo V12 churning out 621 horsepower and 738 pound-feet of torque, for crying out loud. But Brabus thinks it's still not enough. That's why (alongside the 850-hp S63 coupe) it's bringing a version it calls the Rocket 900 to the Geneva Motor Show this week. To turn the S65 AMG into the Rocket 900, Brabus has bored out the cylinders to total 6.3 liters and fitted larger turbochargers, a new exhaust system, intake module and much, much more. The result is an output increased to 887 bhp and 1,106 lb-ft of torque. Brabus has upgraded the limited slip differential to handle the extra muscle, helping it rocket to 62 in just 3.7 seconds, on to 124 in 9.1 and up to a top speed of 217 Autobahn-crunching miles per hour. The famed Benz tuner has also fitted a carbon-fiber aero kit to keep it from flying away (however unlikely considering the vehicle's approximately 5,000-lb curb weight), along with 21- or 22-inch wheels, a retuned air suspension that drops the ride height over half an inch closer to the road and – we can only hope since the release makes no such mention – upgraded brakes as well to keep it all in check. Brabus also offers a full range of interior enhancements as well, but don't expect any of this to come cheap. As it is, the S65 starts at $222,000, but a turn-key Brabus Rocket 900 goes for 347,719 euros – or about $390k at today's rates. Related Video: World premiere at the 2015 Geneva Motor Show BRABUS ROCKET 900 The new reference for high performance in the luxury class V12 with 662 kW / 900 hp, 1,500 Nm and a top speed in excess of 350 km/h BRABUS ROCKET 900 – that is the new reference for high performance in the luxury class, which celebrates its world premiere at the 2015 Geneva Motor Show. BRABUS (Brabus-Allee, D-46240 Bottrop, phone +49 / (0) 2041 / 777-0, fax +49 / (0) 2041 / 777 111, internet www.brabus.com) builds this super car based on the new Mercedes S 65.