Dirty, harmful - not just diesel cars, all combustion engine cars are under scrutiny. The panacea is called electric car. But does it really work or is it just a placebo?

  For months, the German automotive industry has been making negative headlines. Image crisis, diesel summit, emissions manipulations, cartel accusations. However, in all of this, the automotive industry as a whole does not exist. While the cartel accusations are directed at the "Big Five" - Audi, BMW, Daimler, Porsche, and Volkswagen - the situation is different with the diesel scandal. The author tried to shed light on this in the previous column. Or rather: to bring clarity to the major misconceptions about the automotive industry. The first thesis was: "The era of diesel is coming to an end." It was examined in the first part, in the previous column. Four more theses follow now:

Thesis 2: The cartel of the "Big Five" systematically deceived diesel customers for years through secret agreements.

No! For logical reasons alone, this is not true! Economists know (or should know) that cartels in the form of secret agreements can only function between a few car manufacturers (tight oligopoly) and without external competitors (such as manufacturers from Japan or South Korea). They are generally prohibited if they aim to set excessively high sales prices in markets with limited supply and high demand, or to exploit purchasing market power against suppliers by setting low purchase prices. The latter was the case with the truck cartel, where truck manufacturers Daimler, MAN, Volvo/Renault, as well as Iveco and DAF, coordinated prices between 1997 and 2011. The EU Commission fined the manufacturers nearly three billion euros. Daimler alone had to pay one billion. The VW Group, with the MAN brand, went unpunished as a key witness through a self-reporting mechanism. The company has thus had positive experiences with this legal instrument. There was no evidence of such elimination of competition, where customers and suppliers are deprived of fair market prices, against the "Big Five." Instead, the companies were accused of technical agreements to minimize AdBlue urea tank volumes with a corresponding limitation on diesel exhaust gas cleaning. Drawing a conclusion of a subsequent compulsion to manipulate exhaust gas electronics from this is downright adventurous. Firstly, the tank volumes of the individual brands are by no means uniform. They vary in size, with BMW leading the way. Each manufacturer could install what they wanted. Secondly, it contradicts any business logic to compensate for possible cost savings in the double-digit euro range by initially installing small AdBlue tanks, and then offsetting them with millions in investments in manipulated exhaust gas electronics - and also risking high fines. In simple terms: No one can be that stupid! In general, technical agreements for standardization and type approval are sensible and permitted for rational economic reasons, not only in the automotive industry but also in mechanical engineering. And finally: The death of any cartel is external competition and price wars in saturated markets. The current discount battles in the diesel market between all German and foreign diesel car manufacturers are evidence of an extremely fierce competitive situation in the automotive industry and render any idea of a cartel absurd.

Thesis 3: Combustion engines are to be replaced by electric drive in the foreseeable future.

No, they are not. This is simply not feasible quantitatively. Two examples: Firstly, the global stock of combustion engine cars stands at 1.1 billion, with an annual new production of around 85 million. The production capacity for pure electric cars currently amounts to approximately 350,000 units per year. How can the existing stock be replaced just in time for climate protection? Secondly, there is a persistently inadequate electric charging infrastructure. Creating masses of charging stations in the city or rewarding electric cars with free parking spaces is deemed impossible by major housing companies. In Munich, on December 31, 2016, there were exactly 701,131 registered cars. Their owners lived in 140,384 residential buildings and 787,320 apartments (without potential electric charging facilities). The stock of electric cars was 1577, and there were 48 electric charging stations available in the city of Munich. Do the math! How can the mouse give birth to the mountain?

Thesis 4: Electric cars with Lithium-Ion Battery (LIB) technology are the cars of the future.

No, they are not! To avoid being suspected of being a "petrol-head" and showing bias towards combustion engines: Long-term, the future belongs to electric drive! But not to those electric cars powered by LIBs. The reason: The need for production capacities for LIBs is vastly underestimated. The Gigafactory under construction by Elon Musk (Tesla) will have a capacity of 35 GWh at full completion. Assuming an average of 55 kWh battery capacity per car, to power ten million battery-based electric cars, you would need 16 such production facilities - for an estimated 30 million electric cars worldwide in 2030, you would need 50. Even if the investment requirement of 250 billion dollars (as of today) could be easily met: Where will the necessary lithium come from and where will the rare earth elements (both heavy and light) required for battery cell production come from? And for wind turbines and lithium-ion batteries in other devices? World production would need to be increased by a factor of 4 compared to today. But even if the capitalist economic system were capable of this incredible efficiency, what about the political supply security? Where already today, 85 percent of the world's rare earth demand comes from China. Furthermore, it also holds over 44 percent of global reserves. Trade an oil sheikh for a mandarin? Especially considering that the production of battery cells is very environmentally harmful and highly energy-intensive. And in major consumer countries like China, two-thirds of the electricity is still generated from coal. Why is this never critically questioned by green do-gooders? Not to forget amidst all the enthusiasm for electric cars: Experts still dream of synthetic fuels, so-called E- or Synfuels, which involve substituting fossil fuels with artificial fuel produced using electricity for clean diesel. Take: CO2, sun/heat/electricity, process water or seawater, microorganisms, and you have the synthetic fuel - produced without the scarce resources of drinking water or farmland. This would be the best solution for all parties involved!

Thesis 5: Political subsidies and requirements for electric vehicle quotas for manufacturers will help electric cars break through.

No. Faced with the failed attempt to promote the sale of electric cars through state incentives, a proposal has recently been circulating among politicians to push electric mobility through mandatory quotas. European manufacturers should be mandated by Brussels to have a binding electric vehicle quota in production. These considerations were inspired by concrete plans in China. The Beijing Ministry of Industry is set to introduce a final law on the implementation of electric vehicle quotas by the end of August 2017. According to this, auto manufacturers in China must meet an 8 percent electric vehicle quota in production from 2018, which will increase to ten percent the following year, and twelve percent the year after. For German manufacturers, whose profits now depend on the automotive business in China by up to fifty percent (without a single electric car in their lineup), Chancellor Merkel is trying to secure a postponement until 2019 ("zero round"). Such considerations of an electric vehicle quota were born in communist China for a reason. Despite all its capitalist excesses, the economic regime remains central and dirigiste. For a trained market economist, the idea of "electrical coercion" in a national economy is hair-raising. Consumer sovereignty and free entrepreneurial decisions regarding investments and production are fundamental principles of a market economy. Unlike in the former GDR, in the Western world today, what is produced is what the consumer wants, not what the state mandates. Conclusion: Introducing an electric vehicle quota in Europe would be fundamentally wrong because manufacturers would have to produce something they cannot sell freely on the market. This would pose insurmountable problems for the German automotive industry and, above all, for the automotive country of Germany.   [Article published on ntv]