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Day 1 – The industry has undergone a massive change in its external image.
At the IAA today, the street scene is shown even less than in the past. A classic B2B trade fair. Lots of studies, almost only EVs. Few visitors compared to previous exhibitions.
The stands are super small. At previous IAAs in Frankfurt, each manufacturer had an entire hall; today, the VW brand is showing a handful of cars – including the Golf GTI electric, which is not due to arrive until 2027 (!).
The Tesla stand is the most radical and honest. Two cars (Model Y and Model 3) on a neutral stand, without huge screens. WYSIWYG. Looks like a must-visit after the massive subsidies for the plant in Berlin-Grünheide.
This creates a gap that the Chinese manufacturers are filling with a lot of ballyhoo and EVs with good technical data, good looks and very good prices. A Jetta-sized sedan with 80 kWh, +600 km range, screens at the front and rear and fast charging is on offer for €45,000.
The wave is spilling over into Germany. The many EVs lack emotion and differentiation, brands are hard to remember. Cars are becoming even more of a commodity.
The stands of suppliers Conti, Scheffler and ZF as well as many new suppliers for charging infrastructure, automated driving, semiconductors and software, such as MobilEye, are interesting. Samsung has the most impressive stand at the trade fair.
The panel discussions are cautious. Everything is consensus-building about the new world of software-driven electric cars. There are few controversial questions: Are we on the right track? What have we learned just in the last five years? What is the future of the industry?
In Munich, open-air concerts take place in the evening, with free admission and thousands of visitors enjoying the beautiful weather and exuberant atmosphere. The industry is giving something back, but it has nothing to do with cars or mobility. Perhaps this is the only way left to get Gen Z excited about the industry and hand over Germany’s key industry to the next generation.
Day 2 – a closer look reveals surprising insights, even below the EV surface.
The Europeans are coming to their senses and attacking the interchangeability of the Chinese with reminiscences of their successes on new platforms: VW with the ID2 and Golf GTI in the proven Golf/Polo format, the Audi A6 eTron (hotter than ever), BMW’s new series in the beloved BMW 3-series format, Renault with a beautiful e-Scenic (we are waiting for the eR5), Ford with eMustang (GM is rumored to have just launched an eEscalade). EVs are taking the form of successful combustion cars.
The Chinese CEOs (SAIC, BYD, Changan, NIO) meet the German CEOs (Volkswagen, BMW, Mercedes) in a darkened, sparsely attended side room of the trade fair. It is a public exchange of blows of the face-saving kind: the Chinese emphasize their technological superiority, speak of their unprofitable market, of global cooperation and coordinated regulation. The Germans are talking to themselves about how they can maintain their market share in this competition (cooperation, fuel cells, charging infrastructure). The VDA is talking about globalization. The German Foreign Minister will admonish the Germans not to become too dependent on certain markets. She is referring to China – and is hitting on the conflicting goals of geopolitics, environmental protection, German industrial policy and consumer expectations. The expectation is that the automotive industry will come up with solutions.
The VDA publishes a chart. The share of EVs in the world is currently 2%, sales are 15-30%, 60% of all EVs come from China. The imbalance is even greater for batteries. Bloomberg has just reported that fuel consumption has just reached a new high.
If you scrape off the EV surface and take a closer look, you can see it – the familiar combustion world that Europeans have mastered so well.
We learned from Paul Watzlawick that you can’t communicate.
Small stands and no-shows (including Stellantis, Volvo, JLR, the Japanese, the Koreans and the Americans) send a clear message: we won’t be back at this EV-IAA.
However, these contradictions are buried under a lot of trade fair bling, harmonious presentations and panels on the mobility of the future and the headline that German manufacturers are sleeping through the future and the Chinese are taking over the market.
And then there are those who interpret the motto of the IAA more creatively. Renault and Geely will spin off their combustion engine development and production in Aurobay, put it in the basement, so to speak, and continue to use it. This is why Aurobay is flying the flag with two diesel engines at the IAA – the only visible combustion engines at the trade fair apart from a hydrogen engine. However, there are also some hybrids, also from the Chinese.
Opposite the Aurobay stand is the only café where you can sit and process the rush of impressions. Across the street, Mate Rimac (the only serious alternative to the Taycan) is signing a cooperation agreement with Eve, a Chinese battery manufacturer. Their output is currently 250-300 kWh/kg. Next to it is CATL with similar parameters. There is still a tough battle going on here, with basic technology, for every (major) customer.
Renault shows the coolest feature to combat screen fatigue in the cockpit of stationary trade fair vehicles in its Scenic Electric.
The glass roof can be gradually dimmed/shaded at the touch of a button. The product controller’s hair has probably fallen out in view of the cost – sunroofs are set as standard on ageing vehicles and sold at no extra charge. If this feature goes into series production – has Renault created a new design classic here?
Ahhh… I’m curious.
Conclusion – glaring contradictions and a decade of adaptation and learning
If you scratch the surface of EVs, the world of combustion engines comes to light. It will be with us for a long time to come, but will lead a Cinderella-like existence in the cellar. Combustion engines will no longer be developed, but they will be applied and produced.
The industrialization of new technologies, such as batteries and AD/ADAS, is taking up all the attention and investment.
Automated driving could actually become a game changer in this decade. Whoever succeeds in focusing infrastructure, regulation and subsidy policy will be the first to make the leap into electric, autonomous driving.
We are currently 2:0 behind.
The Chinese have a head start here – and not just in battery technology.
Because as unlivable as autocratic societies may seem from here, they have an advantage when it comes to investment decisions in large-scale industries: centralized decisions are faster and more focused. The market and democracies are at a clear disadvantage when it comes to speed.
And then there is the geopolitics that Foreign Minister Baerbock mentioned. If the conflicts intensify further, access to the Chinese market will become more difficult. The allocation models for German manufacturers’ development costs will have to be turned upside down, with the result that the product range will be cut back.
And at the same time, the wave of Chinese kilowatts in Europe will fail to materialize – thus slowing down the electrification of individual mobility in Europe.
In this case, all competencies and supply chains will have to be localized, with the corresponding investments in research, development and learning.
So it remains exciting to see what the IAA 2025 will show: Will it succeed in finding a motto alongside (really cheap electric cars) that unites the global automotive industry and turns the IAA back into a Tier 1 performance show – or will we be looking at regional European solutions and the development of regional supply chains.
My wish would be to give research, technology and learning a large place. After all, this precedes technical innovation, economic growth and social wealth.
I am looking forward to the next IAA in two years’ time, when the technology and knowledge will have progressed. And the VDA and Germany will perhaps have the last chance to create a truly global B2B platform for individual mobility with the IAA.
The conditions for this are excellent in Munich.
