As German automakers face a sharp decline in market share in China, they are also being tested by the tariff cudgel wielded by Trump. Against this backdrop, the upcoming Shanghai International Auto Show has naturally drawn attention from German-language media. The South German Newspaper believes that German automakers have gone from "masters" to "apprentices." The Frankfurter Allgemeine Zeitung (FAZ) worries that the German automotive industry is being caught between China and the U.S.

In a commentary published by FAZ, it is written: Germany's historic automobile industry is experiencing a storm unprecedented in a century,

Mercedes-Benz and Volkswagen have announced layoffs, and the situation for parts suppliers is even more difficult. This commentary titled "The Dual Crisis of Germany's Automotive Industry" writes:

"The current predicament of Germany's automotive industry is even more severe than just a few months ago, mainly manifesting in two aspects: first, the situation for German manufacturers in the Chinese market has further deteriorated; second, the trade war sparked by former U.S. President Trump is severely impacting Germany's automotive industry. China and the U.S. are the world's two largest automotive markets, and both are currently engulfed in turmoil.

In the Chinese market, BMW's sales dropped by 17% year-over-year in the first quarter; Porsche, under the Volkswagen group, saw its sales plummet by as much as 42%. In this crucial Asian automotive market, electric vehicles and hybrid cars are far more popular than in the West. Autonomous driving assistance systems and infotainment systems have become key considerations for Chinese consumers when purchasing cars. However, German automakers clearly struggle to compete with local rivals in these areas.

The leading company in China's electric vehicle sector is BYD, while smartphone manufacturer Xiaomi, which only entered the electric vehicle industry a year ago, is rapidly capturing the market."

The commentary points out that while German automakers are losing competitive edge in China, U.S. President Trump's tariff measures have dealt an even greater blow to German enterprises.

"There seems to be no quick way out of this predicament. For German automakers to circumvent import tariffs by building new factories in the U.S., not only will it take several years but also require billions of dollars in investment. By the time the factory is built and operational, will these tariffs and their instigator, Trump himself, still exist?

At a critical moment when the automotive industry is undergoing the greatest technological transformation in history, German automakers find themselves in crises both in the East (China) and the West (the U.S.), placing the German automotive industry in an extremely perilous situation. To avoid falling behind competitors, automobile manufacturers and parts suppliers must now invest heavily in research and development for electric vehicles, battery technology, and intelligent electronic assistance systems. BMW, Mercedes-Benz, and Volkswagen still maintain relatively sound financial conditions, but to sustain such massive investments in the future, they must possess stable profits. However, the problem lies in the fact that German automakers are seeing significant profit shrinkage in both the Chinese and American markets."

From "Master Craftsmen" to "Apprentices"

The South German Newspaper writes that in the field of automotive technology, German automakers have transitioned from "master craftsmen" to "apprentices," beginning to collaborate with software and automotive companies in China and establish new R&D centers there. Whether this strategy will prove effective remains to be seen at this year's Shanghai Auto Show:

"For decades, Germany's automotive technology has been regarded as a global benchmark. Nowadays, German automakers must prove at the Shanghai Auto Show that they can still thrive in a market that no longer values traditional engineering expertise but prioritizes software, speed, and price. In the electric vehicle sector, Chinese automakers have already become dominant forces in development, design, and digital services. For German automakers, this means not only catching up technologically but also transforming their cultural mindset. In the Chinese market, 'Made in Germany' alone is no longer convincing.

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This year's Shanghai Auto Show also indicates that the focus of German manufacturers is no longer on unveiling new models but on technology itself. Because models from different Chinese brands often look highly similar, what truly matters is price and digital functions. BMW did not introduce any new models this time but showcased the technologies their future models will adopt. Although Mercedes-Benz brought the extended version of the electric CLA and a luxury van concept car, its emphasis was still on software. In terms of driving assistance systems, German manufacturers hope to catch up as well.

The outlook for German automotive brands in China is not entirely bleak, but the days when they were seen as industry role models are over. However, German automakers have begun to learn lessons from market logic, customer expectations, and R&D speed, striving to keep pace. During this Shanghai Auto Show, it will be tested whether German automakers can translate these insights into market-competitive products. More importantly, whether they can play the role of "catching up" in the fields of technology and strategy."

Original article: https://www.toutiao.com/article/7496339827248382483/

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