Europe’s automakers are showing off their latest battery-powered cars at the IAA Mobility car show this week as they try to challenge Tesla Inc. and fend off growing competition from China.
The number of Chinese companies at this year’s IAA has more than doubled compared to just two years ago, as manufacturers like BYD Co. and Xpeng Inc. are pushing into Europe to escape a fierce price war and decelerating economy.
Bloomberg News is speaking with executives from Volkswagen AG, Mercedes-Benz Group AG, BMW AG, Renault SA and several of their Chinese rivals, as well as suppliers Robert Bosch GmbH and Continental AG, about these topics and more.
BYD shows off electric sedan to challenge Tesla’s Model 3
China’s best-selling carmaker BYD showed off its new electric offerings for the European market, including the Seal U compact sport utility vehicle and the Seal sedan. The latter will start from €44,900 ($48,470) in Germany, putting it in direct competition with Tesla’s Model 3 and several of Volkswagen’s cars.
BYD’s design chief Wolfgang Egger, a German native who previously worked for Alfa Romeo, Seat and Audi, said he took inspiration from the ocean for the Seal’s design, pointing out its flowing lines.
BYD has expanded to 15 markets in Europe. Its Atto 3 crossover SUV was the best-selling EV in Sweden in July.
Volkswagen sees EV price parity some years away
The price of VW’s electric cars won’t reach parity with the company’s combustion-engine siblings until the end of the decade, CEO Oliver Blume told reporters. That’s when Europe’s biggest carmaker will produce vehicles from its new EV underpinnings that will add cost-saving scale.
“We want to reach a better price position, but also a better profit position” on EVs, and “our product offering is the decisive factor,” Blume said.
Chinese manufacturers are expected to offer models in Europe at around double the price they’re selling for in their home market, he said.
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Continental taps Google Cloud AI tech for cars
Continental is equipping auto dashboards with Google’s generative artificial-intelligence technology, enabling drivers to chat with their cars.
The German auto-parts maker will integrate the technology into its existing high-performance cockpit computer. Drivers can quiz the AI on a range of topics, from finding the correct tire pressure to more information on highlights along their route. The system answers in real time.
Continental expects the solution to be ready for production in 18 months. By the end of next year, some 30 different cars will be equipped with the high-performance cockpit computers, the supplier said.
Renault’s de Meo wants to avoid price war
Renault CEO Luca de Meo said it’s “important to avoid a price battle in the short term” as European carmakers come under pressure from cuts by Tesla and Chinese manufacturers.
Renault is still planning to list its EV and software arm Ampere next year, which will allow the company to create a “pure EV player” that can help slash the cost of electric vehicles over time. EVs are “not a mature technology yet,” de Meo told Bloomberg Television in an interview.
While the European auto market is “pretty soft” right now, Renault’s plans to unveil a new product each month next year should help the carmaker weather the difficult environment, de Meo said.
Volkswagen’s Blume sees China comeback
Volkswagen CEO Oliver Blume sees China’s economy rebounding from its current struggles and is positioning the carmaker to quickly bring new products to market when it does.
“In China, the market development is not as strong as we expected a year ago, but I’m very optimistic that the Chinese market will have a comeback,” Blume said in an interview with Bloomberg Television. “It’s important to prepare ourselves to be there.”
Blume expects VW’s new partnership with Xpeng Inc. to reap results quickly in bringing new and more tailored products to Chinese customers, as VW seeks to turn around declining EV sales in China.
VW continues to focus on its unified cell and battery production, a key plank in gaining a competitive edge through the company’s huge scale. Blume said VW expects to use its unified cell in about 80% of its electric cars in the future.
First Published Date: 05 Sep 2023, 08:39 AM IST