'Electric cars: tariffs won't save us from China. Competitiveness and cost gap too wide'

'We can continue to raise tariffs indefinitely, but right now the competitiveness and cost gap is such that China could afford even more advantageous pricing policies and still permeate our markets'. Josef Nierling, CEO of Porsche Consulting Italy, does not believe in the effectiveness of tariff barriers to protect the European-made electric car.

In time, Chinese cars will come, as Tesla came. It would be better to push on innovation and competitiveness. Moreover, China responds to tariffs on cars by questioning dairy products, for example. Europe is too dependent on exports to afford this scenario. What we must not do, even on the domestic front, is to lose market share. The automotive pie will not grow enormously, but it is very important, because there are so many jobs behind it. The key is innovation.

The 2035 target is irrelevant to the current problem, which is declining sales. In 2035, the sale of new cars with combustion engines will probably end, but there are still ten years between now and then. Since the development cycle of a car is three years, there will be three generations of electric models and it is unlikely that people will invest in new combustion cars that are competitive with electric ones. And then combustion cars won't sell either. Even manufacturers with an almost entirely combustion product portfolio are struggling. The car market will certainly have a strong rebalancing towards electric, as has happened in China, where electric is already around 50 per cent and will rise towards 75 per cent in the coming years. Questioning the green transition does not help, if anything one can reason about how it should be implemented. Europe, Germany, Italy basically have an export-based economy, not by choice, but because our market is not enough to sustain the welfare system we benefit from. In China, electric cars, alternative energy, software and digital are the fastest growing sectors. So, regardless of the logic of sustainability, behind the Green Deal is the objective of being able to compete and sell in that market, which, although in crisis, is the only one growing by 4-5% per year.

Right now I think European companies are a bit behind, they have not been fast enough and therefore are not attractive not only to the Chinese market, but also to the American market. The companies that had the capacity to develop products for that market segment perhaps started a little slower and therefore are not ready. The premium manufacturers started launching high-end cars first, partly because in a transition phase the product costs more, then more affordable models arrive. It is a timing issue, not a feasibility issue. Today competitive products for that market segment could arrive from China. And I don't know if duties will protect us.