"The cartel" / German carmakers might face "wave of lawsuits"

Der Spiegel / Spiegel Online

“The cartel”

Germany’s most important carmakers have met in “secret workshops” since the 1990s in order to coordinate their exhaust gas treatment systems and collude to fix technology, costs and suppliers, weekly news magazine Der Spiegel and associated website Spiegel Online report. “This could amount to one of the largest cases of cartel agreements in Germany’s economic history,” Frank Dohmen and Dietmar Hawranek write on Spiegel Online. A “sort-of voluntary disclosure” made last year by the country’s biggest carmaker VW revealed that Volkswagen, Audi, Porsche, BMW and Daimler have all been implicated in the secret meetings in which “agreements were made to systematically undermine free competition”, the article says. What might turn out to be especially troublesome for Germany’s most important industry is that the carmakers apparently also agreed on important technical details of their diesel exhaust gas treatment and therefore jointly “laid the basis of the diesel scandal”.

Read the article in German in Der Spiegel here (behind paywall) and on Spiegel online here.

 

Reuters

BMW, VW and Daimler shares take hard hit

Shares of German carmakers BMW, VW and Daimler were falling substantially on Monday after allegations emerged on Friday that the companies operated a cartel, followed by an EU probe into the affair, news agency Reuters reports. “The European Commission said on Saturday that European Union antitrust regulators had received a tip-off about another possible cartel,” the article says.

Read the article in English here.

 

Süddeutsche Zeitung

“Appearance and reality”

Almost no other country hosts as many important car manufacturers side-by-side as Germany and, with about 800,000 employees nationwide, the industry “has an invaluable social responsibility”, Thomas Fromm writes in a commentary for Süddeutsche Zeitung. In order to stand out from their national competitors, German car brands have long sought to promote their uniqueness and “sell emotions alongside steel sheets and horsepower”, Fromm argues. “One has to bear in mind this strategy of distinction to comprehend why the latest allegations over forming a cartel strike the industry at its core,” he writes. If Germany’s most important carmakers have colluded to fix technology and costs since the 1990s, “they not only would have fooled their customers. They would also have ridiculed their precious brand-claims and thereby their company’s identity as well”.

Read the commentary in German here.  

 

Frankfurter Allgemeine Zeitung

“Serial wrongdoing”

Germany’s car industry “keeps falling deeper into the hole that it is digging for itself” two years after the dieselgate scandal broke, Carsten Knop writes in a commentary for Frankfurter Allgemeine Zeitung. Germany’s “poster industry” is not only badly prepared for the shift from the combustion engine to alternative technologies, but is also gambling away its reputation by “having a new scandal revealed every other week”, Knop argues. The industry has committed “serial wrongdoing” but now needed to make a “radical change of strategy” and come clean with the public, he writes. “There’s nothing wrong with cartels that are intended to achieve technological progress,” Knop says, “but if progress is obstructed and competition among suppliers is prevented, the sanctions need to be severe.”

Read the commentary in German here.

 

Handelsblatt

“Has the time of lawsuits come?”

Germany’s carmakers might face a wave of lawsuits after reports over possible collusion to fix costs and technology emerged last week, business newspaper Handelsblatt reports. Tens of thousands of customers might seek compensation for “possibly paying a much too high price” for their vehicles, estimates Klaus Müller, head of the Federation of German Consumer Organisations (vzbv). The European Commission and Germany’s Federal Cartel Authority are currently investigating whether the carmakers have broken the law by agreeing on suppliers and technological details of their exhaust gas treatment systems, the article says. The EU’s consumer protection commissioner Vera Jourova said “enabling class-action lawsuits will relieve our judiciary system. And it strengthens lost faith of Europeans in the rule of law”.     

Read the article in German here.

For more information, see the CLEW dossier The Energiewende and German carmakers.

 

Rheinische Post

VW CEO can imagine diesel phase-out deal

The head of German carmaker Volkswagen told daily Rheinische Post that he can imagine a deal with the government in which the carmakers agree to a phase-out date for diesel engines in return for more support with e-mobility. “If you act with appropriate lead-time, I can imagine that this works. We are talking to the politicians about this,” CEO Matthias Müller told the paper in an interview. He stressed that the “diesel summit” on August 2 with national ministers would yield certainty for customers as the efficient diesel was needed to meet the medium-term climate targets. However, the future “will be driving electrically”.

Find the interview in German here.

Get background on the German carmakers’ efforts to move into e-mobility in the CLEW dossier and a factsheet on Volkswagen.

 

Focus

German transport minister says quick end to combustion engine “nonsense”

Germany’s transport minister Alexander Dobrindt told magazine Focus that the Green Party’s plan to end the production of combustion engines by 2030 was “utter nonsense” because it would massively cost jobs in Germany’s core industrial sector. Organising the exchange of 45 million vehicles could not be done in a few years, he said. “The e-car is part of the future. If it is the sole future cannot be foreseen today.” Dobrindt also rejected calls to ban diesel cars in cities and announced a fund to create masterplans for modern mobility in cities, jointly financed by the government and carmakers.

 

Welt am Sonntag

“Short circuit”

Excitement over technological innovations and the digitalisation of the energy system are “only one side of the coin” of Germany’s energy transition, Daniel Wetzel writes in weekly newspaper Welt am Sonntag. “The other side is that planners and architects of the Energiewende don’t know where to go from here,” he argues. Gearing the German energy supply towards renewable sources has not furthered the country’s climate protection targets and produces rising costs. And “young people ‘doing something with computers’ are now supposed to deliver a technological miracle,” Wetzel says. Given that 27,000 wind turbines and 1.6 million solar plants cover “only 3.1 percent” of Germany’s primary energy consumption, “building an ‘all-electric society’ within the next 30 years seems utterly unrealistic”, he says.

Read more about The digitalisation of the Energiewende in this CLEW dossier.

For details on Germany’s energy consumption and power mix, read this CLEW factsheet.

 

Der Tagesspiegel

“Lusatia cannot save the world’s climate”

Helmar Rendez, head of Lusatian energy company Leag, is opposed to phasing out lignite-fired power production to protect the climate, Jens Tartler writes in Der Tagesspiegel. “We need to let go of the illusion that Lusatia can save the world’s climate while China and India construct vast capacities of coal plants,” Rendez argued. German Chancellor Angela Merkel’s recent remarks on a possible coal exit do not worry the energy manager since Merkel did not specify a possible exit year. Leag’s plan for the eastern German lignite mining region Lusatia included another 25 to 30 years of coal power, Rendez said. However, he conceded that building new coal plants would not be considered by anyone in the country.

See the CLEW factsheet When will Germany finally ditch coal? for more information.

 

Handelsblatt Global

“The end of the energy transition?”

The pro-fossil fuel stance of the new governing coalition in Germany’s most populous state North Rhine-Westphalia (NRW) “could be a harbinger for a nationwide U-turn on the country's bold transition to renewable energies”, Marc Etzold and Cordula Tutt write in Handelsblatt Global. Andreas Pinkwart, energy minister of NRW’s conservative-economic liberalist CDU-FDP coalition, “wants to tear up many aspects” of Germany’s energy transition, arguing the aim was to “make sure that it works according to market economy rules”.  A CDU-FDP coalition also seems conceivable on the federal level after September’s election, Etzold and Tutt say, and Pinkwart makes it clear that “our policy in NRW is also our policy at the federal level”. This prospect causes concern among the traditionally CDU-FDP-friendly energy companies as they had ”pinned their hopes” on renewables since Germany’s nuclear exit had been decided, the authors say.

Read the article in English here (behind paywall).

For more information on German federal elections and the Energiewende, see this CLEW dossier.  

 

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