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German Automakers Are Betting Against Themselves
Philipp Raasch
October 10, 2025
Welcome to Issue #88 of The German Autopreneur.
I'm in Japan right now. From here, I'm watching a debate unfold across Europe.
The most emotional version? That’s happening in Germany.
At IAA, German automakers showed their best EVs yet. Many experts said: Finally, a real answer to Tesla and China.
But something else happened at the same time. These same CEOs were in Brussels. Lobbying the EU. Asking for more time to sell combustion engines.
BMW CEO Oliver Zipse warns: The German auto industry could "shrink by half" if the 2035 combustion ban remains as is.
Politicians are demanding the ban to be scrapped entirely. The calls are getting louder.
This confuses people. What's the actual strategy? Which technologies do the companies actually believe in?
The answer: All of them. And that's exactly the problem.
Today I want to break down a uniquely German concept that perfectly captures this mess.
“Technologieoffenheit” - A Very German Word
Germans have a term for this strategy: "Technologieoffenheit."
It translates roughly to "technology openness." But like many German compound words, it means more than its parts suggest.
Germany is famous for impossibly long words. This one's relatively short. But it captures a very German way of thinking.
The idea sounds reasonable: Stay open to all technologies. Don't commit too early. Keep your options flexible.
In practice? It means developing everything at once. Combustion engines. EVs. Hydrogen. E-fuels. Plug-in hybrids. All of them. Simultaneously.
Supporters call it pragmatic. They say it adapts to different customer needs. It reduces risk.
BMW emphasizes that this approach increases resilience.
Porsche just shifted back to this strategy. From a strong EV focus to more combustion engines again.
Porsche justified the shift: "Risk and bold decisions are part of Porsche's DNA."
The implied message? Others bet on one technology. We're bold enough to try different paths. To swim against the current.
In reality, it's exactly the opposite.
Why Betting on Everything Is the Most Risk-Averse Move
A truly bold move would be a clear bet on the future.
Bold would look like this: “We believe in this technology. We're going all in. Every resource goes here.”
Betting on everything is the most risk-averse strategy possible.
No vision of the future? Place chips on every number.
This is what people globally call "German Angst." The German tendency to overthink risks instead of taking them.
What would a truly bold Porsche move look like? Dropping EVs completely. Sticking with combustion. Betting everything on e-fuels.
But that's not what they're doing.
They stay in the middle. Keep all options open. Wait and see.
The problem: This strategy costs a fortune.
Each powertrain needs its own development teams. Its own production lines. Its own supplier structures.
A new platform costs around €10 billion. Developing multiple powertrains in parallel? Multiply that cost.
And here’s the real danger: While competitors focus everything on one technology, you spread yourself thin.
You’re investing in winners and losers at the same time.
Nokia, Blackberry, and Kodak Already Went Through This
2007: Apple launches the iPhone.
Nokia and Blackberry are still market leaders. Both recognize that smartphones could be the future.
But neither dared to go all in.
Instead, they kept making classic phones. While trying to build smartphones on the side.
They wouldn’t commit. They kept all options open.
The result? Both disappeared from the market.
Then there’s Kodak. In 1975, they invented the first digital camera. But they didn't dare bet on it fully.
Why? Their entire business model was based on analog film.
So they developed both technologies in parallel. Digital cameras. And analog film.
Strategic restraint instead of bold vision.
The result? Bankruptcy in 2012.
That's the problem with betting on everything. No clear vision for the future. Resources spread everywhere.
You lose to those who focus.
How Markets Are Actually Developing
Let's look at the numbers:
Diesel: New car share in Europe dropped from 52% (2015) to under 12% (2024). In the US and China? The technology is dead.
Hydrogen passenger cars: Only 12,866 fuel cell vehicles sold worldwide in 2024. Down over 20% from the year before. Compare that to 10.8 million battery EVs in the same year.
E-fuels: One analysis forecasts that by 2035, the EU will produce enough for just 2% of its vehicle fleet. Plus, they require 5x more electricity than an EV.
What the EU Actually Decided
There's confusion about what the EU actually decided. Here are the facts:
From 2035 on, only zero-emission new cars can be registered in the EU.
Existing combustion cars? Drive them forever. Sell them. Repair them. Maintain them. Nobody has to scrap their car in 2035.
One exception: E-fuel vehicles can still be registered after 2035. But they must technically be designed so that you can’t fill them with fossil fuel.
Also important: 2035 isn't the only deadline. By 2030, new car emissions must drop 55% compared to 2021.
This 2030 target is the real game changer. It forces action now.
What China Does Differently
Many German CEOs now point to China as a model.
What does China do differently?
China hasn't banned combustion engines. Yet NEVs make up over 50% of new car sales.
How? With a system of incentives and requirements.
Manufacturers get penalty points for making combustion engines. They compensate by producing EVs. High EV quotas become mandatory.
The crucial difference? What China calls an EV.
China uses the category “New Energy Vehicles” (NEVs). This includes battery EVs, plug-in hybrids, and range extenders.
This gives manufacturers more flexibility than Europe's zero-emission target for 2035.
At the same time, China invested heavily in charging infrastructure. EVs get registration advantages and easier license plates. Customers get real purchase incentives.
The advantage over Europe's model? Stability. No constant political battles over delays or exemptions.
The Problem With Zigzag
Is the EU strategy perfect? No.
The Chinese model simply worked better.
But it’s too late. The EU's 2035 target stands. It's already decided.
Constantly challenging this only makes things worse.
Why? Because it confuses consumers.
Imagine you want to buy a car and keep it for 10 years. You keep reading contradictory reports. Politicians debate combustion comebacks. E-fuels. Hydrogen.
You'd think twice about buying an EV. Will the technology still be supported in 5 years? Will charging infrastructure exist?
This uncertainty kills EV adoption.
The Corporate Strategy Problem
But there's a second level. And that's the real issue.
Using this hedging strategy at the corporate level.
With political requirements, you can debate which path is better.
As a company strategy? It's disastrous.
Why? Because focus wins.
Spread your resources? You won't lead anywhere.
Nokia, Blackberry, and Kodak already proved this.
The Downward Spiral of Indecision
Betting on everything creates a downward spiral:
Step 1: Fragmented Development
Companies spread resources across all technologies at once. They invest in everything. Master nothing.
Step 2: Uncertainty Everywhere
The industry sends mixed signals. Externally and internally.
The message? We don't know what's coming.
Employees ask: What should I specialize in?
Investors ask: Does management have a vision?
Customers ask: Should I buy now or wait?
Top talent leaves for companies with clear direction. Investors back players with clear strategy. Customers don’t buy.
Step 3: Competitors Pull Ahead
Focused competitors move faster. They expand their tech lead. They gain market share.
Bosch shows this perfectly. They invested broadly in diesel, hydrogen, and e-mobility. The result? 22,000 jobs gone by 2030. The bets on diesel and hydrogen failed.
Invest in multiple technologies at once? Development costs multiply. That's the direct cost of betting on everything.
You see it in pricing. The Chinese offer cheaper cars - also because they focus their investments.
My Take
The push for "Technologieoffenheit" comes primarily from Germany.
Why? Because German automakers invested in combustion technology for decades. Entire factories, supplier structures, and jobs depend on it.
A quick combustion phase-out means massive restructuring. Expensive investments. Jobs disappearing.
This multi-technology strategy buys time.
Time to use existing investments longer. Time to cut jobs gradually instead of suddenly.
Understandable. But not a winning strategy.
Betting on everything isn't what it promises. Not a bold vision for a diverse future. It's the opposite.
An attempt to hold onto the past. A fear of committing to the new.
Former VW CEO Herbert Diess put it well: "The more time spent on dying technologies like diesel, the easier for Chinese companies to pull ahead."
The core problem? Unwillingness to take risks.
Traditional automakers need to make a bet.
The alternative? Wait until there's no risk left. Until the answer is obvious.
By then it's too late. Focused competitors will have already won.
Making no decision is a decision.
For the status quo. Against the future.
That's all for today.
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Until next week,
— Philipp
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