Closing factories will not be enough to save Volkswagen(economist.com)
economist.com
Closing factories will not be enough to save Volkswagen
https://www.economist.com/business/2024/09/05/repairing-vw-requires-huge-upheavals
94 comments
Apple may have produced a few pieces of popular hardware before they produce the iPhone.
I expect a more telling difference is whether the management of the successful company is overtaken by people who are better at political infighting than competing with other companies
I expect a more telling difference is whether the management of the successful company is overtaken by people who are better at political infighting than competing with other companies
It keeps me busy, this kind of thinking. In a good way - something to mull over.
These massive companies that epically fail to adjust, is it primarily a management style (cliché representation: Private equity takeovers – focus on 'management is a job unto itself, I do not need to know much or care much about what this company actually produces', and perhaps as a consequence, cost cutting over care about the product, and considering the general opinion about your company and products as a 'brand thing that I do not need to care about; I have a marketing department for that who can fix this by tossing some ad euros at something')...
or is it more fundamental, that even with pretty good management, companies inevitably turn into a giant rusty smattering of cogs that generally keeps running but is nearly impossible to reconfigure? That we should e.g. study what Apple is doing with its odd corporate management structure: That it is _exceptional_ for a larger company to be able to pivot quickly regardless of market, circumstance, or management team?
Or is software development just uniquely difficult and therefore it is highly likely that a company that starts with a better-than-average grip on that and worse-than-average everything else still wins over a company that needs to 'buy in' to software?
Not enough data to really know, and the answer probably a convoluted mess of 'a little bit of everything'.
These massive companies that epically fail to adjust, is it primarily a management style (cliché representation: Private equity takeovers – focus on 'management is a job unto itself, I do not need to know much or care much about what this company actually produces', and perhaps as a consequence, cost cutting over care about the product, and considering the general opinion about your company and products as a 'brand thing that I do not need to care about; I have a marketing department for that who can fix this by tossing some ad euros at something')...
or is it more fundamental, that even with pretty good management, companies inevitably turn into a giant rusty smattering of cogs that generally keeps running but is nearly impossible to reconfigure? That we should e.g. study what Apple is doing with its odd corporate management structure: That it is _exceptional_ for a larger company to be able to pivot quickly regardless of market, circumstance, or management team?
Or is software development just uniquely difficult and therefore it is highly likely that a company that starts with a better-than-average grip on that and worse-than-average everything else still wins over a company that needs to 'buy in' to software?
Not enough data to really know, and the answer probably a convoluted mess of 'a little bit of everything'.
I recommend Parkinson's essay on injelitence
I think some of it is just age related. Massive, older companies accumulate older employees, who tend to be less performant and more expensive. When technologies shift their accumulated experience, which may have been keeping them viable, loses value.
I know tech workers don't like to hear about this, but it's something you all need to keep in mind as you plan your careers.
I know tech workers don't like to hear about this, but it's something you all need to keep in mind as you plan your careers.
But wouldn't you agree that by the time of iPhone, Apple had had a fair share of political infighting and forgetting to compete with other companies too?
At the time of the iPhone Steve Jobs made the iphone an important project and so political infighting was not done. There is always political infighting, but sometimes it can work for you.
Not really. Feels like orders of magnitude less than other companies of similar size. And still feels like that today. However, the fact that this sense of 'we are ALL and thus need not bother with anything but company-internal politics and how we influence the world at large' is missing at Apple is now hurting them: They appear to be pretty brazenly picking fights with governments thinking they are the david, and they.. really, _really_ aren't.
One wonders why.
* Lingering influence of Jobs? Even now? * Their somewhat well known weird corporate structure? * A cultural conviction that they are the underdog, instilled decades ago when Apple was doing badly, a conviction that is cherished with such religious fervour it survives even today when Apple has been top 3 market cap world wide, has reigned the profitability-in-cell-phones charts for over a decade, and in general has a profitability that makes your head spin, it's incomparably large (literally: Compare it to other big corps and it is mind boggling).
I just don't know what it is. I find it remarkable that Apple does _not_ seem like it has had its fair share of political infighting and forgetting to compete. It has had its share of that, sure. But not its fair share. Not even a tenth.
One wonders why.
* Lingering influence of Jobs? Even now? * Their somewhat well known weird corporate structure? * A cultural conviction that they are the underdog, instilled decades ago when Apple was doing badly, a conviction that is cherished with such religious fervour it survives even today when Apple has been top 3 market cap world wide, has reigned the profitability-in-cell-phones charts for over a decade, and in general has a profitability that makes your head spin, it's incomparably large (literally: Compare it to other big corps and it is mind boggling).
I just don't know what it is. I find it remarkable that Apple does _not_ seem like it has had its fair share of political infighting and forgetting to compete. It has had its share of that, sure. But not its fair share. Not even a tenth.
This is true across many industries as well. For example, today’s SLR cameras have terrible software that is nearly impossible to change by anyone other than the manufacturer. I feel they should be a sensor and physical buttons with today’s phone hardware for brains. Let the user load custom software to control the hardware if they wish.
not only are they not going to do that, Sony’s android phones delete the firmware if you unlock the bootloader
Yup
Hardware engineers (most of them, anyway) make awful software developers.
They always get dregged on any slightly flexible process and higher level development.
Hardware engineers (most of them, anyway) make awful software developers.
They always get dregged on any slightly flexible process and higher level development.
I can design hardware - but as a programmer I know I'm not very good with it and avoid it. I know when I design something it will be subject to things I barely understand like RF and cross talk. I could get a EE degree (either formally or just by self study), but that would be a lot of work and so I think it is better to not do that. Hardware developers fail to understand they are not very good at software and they don't understand the mess they are making.
And when software engineers are allowed to built hardware, we end up using touchscreens to turn on our headlights. Whoever decided that we need an app to open our car doors was't a hardware engineer.
You use touchscreens to turn on your headlights because it is cheaper, touchscreens and embedded SoCs are so cheap these days that adding one to your car (as long as it is rectangular) is tons cheaper than wiring multiple buttons on your dashboard.
The cost of programming those displays is relatively small and fixed, it doesn't get more expensive if you sell 1 million cars or 10. But these companies still haven't managed to have proper processes for the software platforms for their cars so the software ends up sucking.
They treat their cars like video game developers, once done and released there might be a few patches. But the next car is mostly rebuilding the software from scratch.
On an aside as more people are becoming aware that buttons and knobs are actually nice you will likely see them coming back, but only on the more expensive vehicles.
The cost of programming those displays is relatively small and fixed, it doesn't get more expensive if you sell 1 million cars or 10. But these companies still haven't managed to have proper processes for the software platforms for their cars so the software ends up sucking.
They treat their cars like video game developers, once done and released there might be a few patches. But the next car is mostly rebuilding the software from scratch.
On an aside as more people are becoming aware that buttons and knobs are actually nice you will likely see them coming back, but only on the more expensive vehicles.
> On an aside as more people are becoming aware that buttons and knobs are actually nice you will likely see them coming back, but only on the more expensive vehicles.
While the inflationary overuse for touchscreen is driven by cost (and fashion), it's not really like that buttons are coming back only in higher priced cars. Dacia being the cheapest European automaker uses lotsof buttons in their cockpits.
While the inflationary overuse for touchscreen is driven by cost (and fashion), it's not really like that buttons are coming back only in higher priced cars. Dacia being the cheapest European automaker uses lotsof buttons in their cockpits.
Apple had iPod which was almost an iPhone already and they had decades of hardware and UX experience. They needed the cellular bits which they didn’t all build inhouse. Qualcomm is still the modem giant and Apple still uses them.
I’ve just rented a toyota and it’s comical. How people keep buying this???
Car is perfectly fine (despite being an anaemic ICE), but damn fix your UX.
People shit on Teslas touchscreen, but buttons on your Toyotas are worse - smaller, crowded and hard to discern.
Audio connectivity feels designed by lawyers who wish you to crash car as quickly as possible (thinking about this loud - maybe it’s a good thing, like the tullock spike?)
Car is perfectly fine (despite being an anaemic ICE), but damn fix your UX.
People shit on Teslas touchscreen, but buttons on your Toyotas are worse - smaller, crowded and hard to discern.
Audio connectivity feels designed by lawyers who wish you to crash car as quickly as possible (thinking about this loud - maybe it’s a good thing, like the tullock spike?)
All cars I’ve rented in the last 5+ years have CarPlay/Android Auto, so it is all the same UX. Connect the phone via usb or Bluetooth, and I’m good to go. Can’t say that for Teslas.
Except most cars I've tried had shite carplay connectivity.
CarPlay is a handy crutch for cars with terrible software. Teslas have had generally good software.
This is exactly the Volvo / Polestar philosophy. There is a Decoder podcast with their CEO about just this sentiment.
I've got a Stellantis vehicle (admittedly, a higher trim one) and my girlfriend has a Model Y. I absolutely HATE driving the Model Y. Tesla's UX is far, far worse. The main thing I interact with in my car is CarPlay. Simple things CarPlay does well (making and receiving calls, providing directions, voice to text, playing music/podcasts, etc.) Tesla fails at and that's most of what a car UX is for these days.
I will literally never get a car without CarPlay. But even excepting that, Tesla's UI mostly sucks.
The answer to shitty buttons isn't shove it all 3 layers deep in a touch screen menu, it's better buttons.
I will literally never get a car without CarPlay. But even excepting that, Tesla's UI mostly sucks.
The answer to shitty buttons isn't shove it all 3 layers deep in a touch screen menu, it's better buttons.
I haven't tried Stellantis (though MB I've drove 2 years ago was awful), but CarPlay has nothing against Tesla. Maybe you are not used to it, but after a while craplay feels like a joke. Sure, Siri and custom apps is nice, but maps and its UX is just unbelievably behind.
Im very used to both, can’t stand Tesla. I’ll take my RAM any day. It was funny watching my girlfriend use CarPlay, I had to show her “honey just say Siri call mom” as she was looking for some menu on the screen. She’s just used to doing everything the hard way.
Siri is how I interact with my car while driving. Tesla’s voice recognition is straight out of a 2005 flip phone. I can’t just call someone or play the music I want to hear without touching screens. I can’t just tell the GPS where to take me because it doesn’t understand proper nouns. It’s maps routinely don’t have things or have inaccurate data. (I do love that you’ll be driving through a neighborhood and it shows you every goofy home-based business in the DB though.)
The last thing I want when driving is distraction and their UI seems designed to do it as much as possible, probably so you’ll give up and pay them for self-driving. Or you can drive at highway speeds while digging through a convoluted touch screen just to control your HVAC.
I use tons of apps on CarPlay that don’t exist on Tesla. Tesla supports very few. Apple maps is bad, luckily you can use others easily.
Tesla’s UI is so bad I honestly thought you must be trolling for a second.
Siri is how I interact with my car while driving. Tesla’s voice recognition is straight out of a 2005 flip phone. I can’t just call someone or play the music I want to hear without touching screens. I can’t just tell the GPS where to take me because it doesn’t understand proper nouns. It’s maps routinely don’t have things or have inaccurate data. (I do love that you’ll be driving through a neighborhood and it shows you every goofy home-based business in the DB though.)
The last thing I want when driving is distraction and their UI seems designed to do it as much as possible, probably so you’ll give up and pay them for self-driving. Or you can drive at highway speeds while digging through a convoluted touch screen just to control your HVAC.
I use tons of apps on CarPlay that don’t exist on Tesla. Tesla supports very few. Apple maps is bad, luckily you can use others easily.
Tesla’s UI is so bad I honestly thought you must be trolling for a second.
The last Toyota rental I drove (think it was a ‘22 or so?) sure had a smaller, less ‘app-like’ touchscreen and a lot of physical buttons, but I could use those buttons while driving. I’m giving this one to the Toyota.
Edit: Your not meant to try and pair your phone while driving on any car.
Edit: Your not meant to try and pair your phone while driving on any car.
My 2019 Toyota has terrible UX. The higher end cars, particularly newer ones, are a little better (comparing Camry vs Corolla e.g.) but overall pretty bad.
Would love to hear people's opinions on car UX though. The Tesla is terrible too, as are most newer car brands. I haven't minded Hyundai cars, and I recently drove a new Nissan that was decent.
Would love to hear people's opinions on car UX though. The Tesla is terrible too, as are most newer car brands. I haven't minded Hyundai cars, and I recently drove a new Nissan that was decent.
I drove a Hyundai that wanted to sync contacts from my phone when I connected it to Bluetooth to play music. I declined for privacy reasons, and the car then had this loud booming audio request to sync contacts every single time I turned on the car and then I had to wait 30 seconds for the car to timeout/fail after my phone denied the request, and then I had to click on a touchscreen to skip the sync rather than retry.
I ended up just not using Bluetooth while I drove that car because it was such a nuisance. I'm not sure whether it was so bad because of incompetence (they never considered users not wanting to share contacts) or out of malice (they know they can wear people down through harassment and hassle to eventually share their data).
I ended up just not using Bluetooth while I drove that car because it was such a nuisance. I'm not sure whether it was so bad because of incompetence (they never considered users not wanting to share contacts) or out of malice (they know they can wear people down through harassment and hassle to eventually share their data).
You could get one of those bluetooth things that plugs in to your cigarette lighter and broadcasts music on a free FM channel. We have a couple and they work pretty well.
They are only useful in areas without FM stations. I had one and threw it away, because every 5 km there would be a station on the same frequency interfering so the copilot had to change the frequency... useless. What a "luck" that Switzerland is shutting down FM. Ah, and you can't do phone calls with it either.
That's a reason for me to return the car and get my money back.
Oh I have a 10 years old VW with both buttons and touchscreen. I tell you, the buttons you can learn and they're the same across similar VW models, but as soon as you have to do anything with the displays (the big one in the cockpit and the small one on the board) things go downhill immediately. I don't know who designed such UX, but I wonder, do they have the nerve to put it in their CVs?
I can't use touchscreens while driving because I keep missing a lot. I'd have to look at the screen for too long. That's why I prefer low priced or older models. I'm puzzled why touchscreens are even allowed.
I had no idea VW Group did so badly. On the other hand, the ID series... I don't even have words for how bad it looks on the outside and on the inside. And the pricing... very, very expensive.
Glancing through the article, it seems VW is doing the same mistakes as other corporations that are not software native: they see software development as an assembly line and think it works like an assembly line where you have an expected output rate.
Glancing through the article, it seems VW is doing the same mistakes as other corporations that are not software native: they see software development as an assembly line and think it works like an assembly line where you have an expected output rate.
VW had more profits 23 than in 22. It's their VW brand that is in trouble, Seat and Skoda are much more profitable.
How come? All the cars are basically identical, just the logo is changed and they look a bit different on the outside.
On the other hand, the ID series... I don't even have words for how bad it looks
Really? While I'm not a huge fan of the ID 3 or 4, I think both the 5 and especially 7 look OK. Plus the Buzz is pretty cool. I agree that all their ID cars are too expensive though.
Really? While I'm not a huge fan of the ID 3 or 4, I think both the 5 and especially 7 look OK. Plus the Buzz is pretty cool. I agree that all their ID cars are too expensive though.
I waited for the buzz with excitement. Then it came out and the details, and price were... an insult. Do they really want to restrict their consumer buyers to (questionably) fashion-forward rich hipsters?
How far from their roots they've wandered...
How far from their roots they've wandered...
Do they really want to restrict their consumer buyers to (questionably) fashion-forward rich hipsters?
I mean if you have to pick a group to target, you could do a lot worse. That being said 80-90% of the ID Buzz's I actually see on the road are company cargo vans, so that might be the actual target market.
I mean if you have to pick a group to target, you could do a lot worse. That being said 80-90% of the ID Buzz's I actually see on the road are company cargo vans, so that might be the actual target market.
I don't know, they seem very spartan and plasticky to me.
Maybe their focus on costs is why their recent cars are terrible.
I've had a 22 Jetta as a loaner and it's the worst car I've driven in a long time. I've driven older jettas like 10-15 years ago and they were pretty sporty. This one's a boring sedan. The screen is so tiny. Its lane keeping is beyond useless.
We had to do a 6-hour road trip, and everyone agreed the seats are unbearable after about 2 hours.
I've had a 22 Jetta as a loaner and it's the worst car I've driven in a long time. I've driven older jettas like 10-15 years ago and they were pretty sporty. This one's a boring sedan. The screen is so tiny. Its lane keeping is beyond useless.
We had to do a 6-hour road trip, and everyone agreed the seats are unbearable after about 2 hours.
I was absolute Volkswagen fan. The Audi Quattro was great. Diesel engines were a huge leap forward during Golf 4 times (20 years ago). 1.9 TDI was great, had that nice 96 kW version. Afterwards VW cut quality. Suspension in VW got worse than in Audi branded cars. The FSI engines came with timing chain problems. Then the big story with diesel defeat device and gasing apes. And then ID branded electric cars showed up and were obviously at least one generation behind competition. And every year the price jumped higher and higher and there was no improvements in quality or design. Current VW is a brand of boring expensive cars with average quality and very arrogant management. This is a perfect recipe to disappear.
China didn't look like a competitor until they were miles ahead.
"Appear weak when you are strong, and strong when you are weak" - Sun Tzu
"Appear weak when you are strong, and strong when you are weak" - Sun Tzu
VW plan was to JV with a Chinese auto brand (or buy one outright), design & make in China, and then re-import them into Europe. The only way they could get price down for the consumer, at the quality level required to sell in Germany, is to leverage China supply chain and automated manufacturing advantages. VW EV built in Germany currently incurs significant loss per vehicle. This is part of the reason why German auto was so against EU tariffs - which basically scuppers this plan
VW has Chinese joint ventures since decades. They already sell their "jv-EVs" in China, just not in Europe. I think in that regard, they are undecided wheter these products will meet brand standards in Germany.
VW as a brand went upmarket in the 2000s, with Skoda / Seat / jvs going for the meat. They became world class in repackaging and rebadging, and EoS helped a lot. That also made them kind of conservative in engineering, since everyting everywhere is super path dependent. You could find the same switch in a Seat Arosa and in a Bentley.
They are not trying to make a good EV, they try to replicate their ecosystem as a whole and that needs EoS above anything.
VW as a brand went upmarket in the 2000s, with Skoda / Seat / jvs going for the meat. They became world class in repackaging and rebadging, and EoS helped a lot. That also made them kind of conservative in engineering, since everyting everywhere is super path dependent. You could find the same switch in a Seat Arosa and in a Bentley.
They are not trying to make a good EV, they try to replicate their ecosystem as a whole and that needs EoS above anything.
Wouldn't the tariffs help them sell their own cars though? Collaborating with a Chinese manufacturer would only be required because the Chinese cars would undercut on price in the EU market. With tariffs, they won't.
Germany made VW EV are already too expensive (and yet still make a loss per vehicle). Tariffs might give a short window - VW CFO has said 1-2 years - to get to the level where they can make cars profitably and affordable for the consumer. No chance of this
Is German Economy in a free fall at the moment?
Looks like many companies are in a "zombie state" unable to survive high interest rates, high inflation, and widespread job losses happen mostly among high-income individuals?
"Green idea" seems to have failed completely, and the long-term effects remain uncertain. Meanwhile, far-right and far-left parties are gaining momentum, that's scary!
Looks like many companies are in a "zombie state" unable to survive high interest rates, high inflation, and widespread job losses happen mostly among high-income individuals?
"Green idea" seems to have failed completely, and the long-term effects remain uncertain. Meanwhile, far-right and far-left parties are gaining momentum, that's scary!
Dear VW Group, please follow Tesla's example and eliminate your rent-seeking dealership network. Then you can reduce prices to a level that customers are willing to pay.
That’s what a global market does: global competition from both Tesla and other imports.
Companies come and go: c’est la vie.
Yet, it might be too soon to write down VW.
Companies come and go: c’est la vie.
Yet, it might be too soon to write down VW.
I wonder what plan B should be for the Western labor forces that are not competitive with 9-9-6 kind of labor. With transportation as cheap as it is, obviously the two sides must equalize one way or another.
Tarrifs are the obvious solution and what we're doing. I expect to see a lot more of it. This is the one situation where economists would largely recommend them.
If you're afraid of a looming onslaught of cheap Chinese cars, just make 'em not cheap.
If you're afraid of a looming onslaught of cheap Chinese cars, just make 'em not cheap.
But then again, you want to export to China as well, so they can make your products more expensive in retaliation by slapping tariffs on your exports.
And they certainly have and will and it has had an impact. But what’s the alternative? Let them decimate your industries one by one until they own them all?
It’s not great in any case and one hopes diplomacy can solve it but I don’t see another path.
It’s not great in any case and one hopes diplomacy can solve it but I don’t see another path.
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War & tariffs. That seems to be the way it's going.
996 is self-destructive.
The current events have more to do with the entire Chinese society (knowingly or unknowingly) being led by the CCP to massively subsidize their manufacturing far beyond demand curves at >10x the rate of the west.
Many of their industrial companies now only survive as jobs programs that would collapse if they were not being subsidized by the government.
This is a publicly acknowledged long term play that is starting to bear fruit.
1) Invite tech companies like VW to manufacture in China.
2) Set up government funded parallel factories to quickly clone the output.
3) Compete on price with a government backed supply chain.
4) Flood the zone and put global competitors out of business who don’t have the 10x subsidizes.
5) Reduce subsidies and be the last company standing.
Edit: Here is a department of treasury talk on this from July: https://www.cfr.org/event/us-china-economic-relations-jay-sh...
The current events have more to do with the entire Chinese society (knowingly or unknowingly) being led by the CCP to massively subsidize their manufacturing far beyond demand curves at >10x the rate of the west.
Many of their industrial companies now only survive as jobs programs that would collapse if they were not being subsidized by the government.
This is a publicly acknowledged long term play that is starting to bear fruit.
1) Invite tech companies like VW to manufacture in China.
2) Set up government funded parallel factories to quickly clone the output.
3) Compete on price with a government backed supply chain.
4) Flood the zone and put global competitors out of business who don’t have the 10x subsidizes.
5) Reduce subsidies and be the last company standing.
Edit: Here is a department of treasury talk on this from July: https://www.cfr.org/event/us-china-economic-relations-jay-sh...
This strategy is not unique to one particular country. Basically, it happens on different scales but repeatedly in the history (like Japan post-war).
Having an order of magnitude larger country makes this strategy somewhat similar, but different in kind, due to the new economic distortions that haven’t been trialed before.
>>I wonder what plan B should be for the Western labor forces that are not competitive with 9-9-6 kind of labor
It's not really tongue-in-cheek to suggest that labour rights for other countries are being fought to emulate other Western labour forces that transitioned away from 9-9-6 to 9-5-5 (and maybe aspirationally eventually 10-3-4).
For example, there is a growing backlash in China around the "inevitability" of 9-9-6 resulting in more youth (still a tiny minority, but growing) opting out. As manufacturing and the 9-9-6 (or worse) schedule transitions to cheaper countries, the cycle will repeat.
It's not really tongue-in-cheek to suggest that labour rights for other countries are being fought to emulate other Western labour forces that transitioned away from 9-9-6 to 9-5-5 (and maybe aspirationally eventually 10-3-4).
For example, there is a growing backlash in China around the "inevitability" of 9-9-6 resulting in more youth (still a tiny minority, but growing) opting out. As manufacturing and the 9-9-6 (or worse) schedule transitions to cheaper countries, the cycle will repeat.
The western model is architected to exploit cheap labour from its colonies/vassals/"developing states". And to keep them from ever becoming developed. When these become unavailable, there is no plan B, you just go bankrupt and out of business.
I disagree. Yes, the west had pretty terrible colonial past, but we are owning up to that. We introduced supply chain laws to remove child labor and extortion where possible. We have debates over closing factories because of human rights violations. Yes, there's black sheep, but in total the west is trying sincerely.
And then you have russia, which is basically the largest colonizer on the plant, and Saudi Arabia, North Korea, Syria, many African Countries... which are a gleaming example of human rights as we all know. Yet, you chose to pick on the group of countries which at least try?
I cannot understand your worldview.
And then you have russia, which is basically the largest colonizer on the plant, and Saudi Arabia, North Korea, Syria, many African Countries... which are a gleaming example of human rights as we all know. Yet, you chose to pick on the group of countries which at least try?
I cannot understand your worldview.
this article is literally about closing factories in GERMANY. So VW is definetely not "exploiting cheap labour from its colonies/vassals/".
Why not? Cheap energy from Russia, that came to an end. Cheap parts from China are not so cheap now because trade war and tariffs. Result: margins shrink, VW makes worse cars at higher price.
You said they are exploiting cheap labour from its colonies/vassals, again the factory is in germany.
Also electricity prices are largely back to pre-war levels https://tradingeconomics.com/germany/electricity-price , so is the gas price https://tradingeconomics.com/germany/gasoline-prices
Also electricity prices are largely back to pre-war levels https://tradingeconomics.com/germany/electricity-price , so is the gas price https://tradingeconomics.com/germany/gasoline-prices
Automation - which western companies have been doing for years. The typical western factory makes just as much today as in 1950, but with 1/10th the number of humans. That automation is often not only cheaper (compared to western wages, not compared to Chinese wages!), but more accurate.
That's a solution for handling the manufacturing/productivity side, though doesn't necessarily address the part of the labor force that may become redundant. Growth is always possible as long as a technological edge exists over the cheaper labor regions, but when that goes away it's down to UBI or (idealized) communist style redistribution. I don't know how compatible the market economies are with this kind of policy. Interesting times indeed
There are more jobs than ever. Someone needs to design those machines they are building, design the automation and so on. There is more we want to do than there are people for the foreseeable future.
Westerners wouldn't need as much noncompetitive wages if housing was cheaper.
Related:
An 'earthquake' at Volkswagen – and a crisis for Germany?
https://news.ycombinator.com/item?id=41473376
An 'earthquake' at Volkswagen – and a crisis for Germany?
https://news.ycombinator.com/item?id=41473376
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Excessive enthusiasm with EVs were the spell of death for german auto manufacturers.
Then, the absurdly stupid sanctions on Russian Oil and Gas, coupled with the irrealistic and inconsequential energy transition and other absurdly emotionally charged decisions like phasing out nuclear power.
Germany industrial competitivity depended a lot on cheap Russian energy that could only be realistically replaced with Nuclear Energy.
Blaming volkswagen demise on incidental stuff like their issues with software is something that only someone as ignorant of the real world as a journalist from The Economist could do.
Then, the absurdly stupid sanctions on Russian Oil and Gas, coupled with the irrealistic and inconsequential energy transition and other absurdly emotionally charged decisions like phasing out nuclear power.
Germany industrial competitivity depended a lot on cheap Russian energy that could only be realistically replaced with Nuclear Energy.
Blaming volkswagen demise on incidental stuff like their issues with software is something that only someone as ignorant of the real world as a journalist from The Economist could do.
Why do you think that nuclear energy, requiring Uranium, a resource that again has to be bought from another country (a lot of the supply comes from Autocracies), is the better alternative to renewable energies?
Edit: And moving away from russian energy is the best thing Germany did since the Berlin wall fell.
Edit: And moving away from russian energy is the best thing Germany did since the Berlin wall fell.
Because solar and wind renewables are intermitent, and the factual reality of energy prices and grid stability in every fucking place of earth that went all in into renewables trumps the all the wishful thinking of the the rent seeking renewable energy industry.
The reality nowadays is that for every single GW of renewable capacity generation you forcibly have to have another GW of dispatchable generation, usually natural gas, it is also inescapable that renewables, especially solar, displace baseload generation, reducing its ROI while not eliminating its fixed costs, making energy as a whole more expensive.
Most people have no fucking idea of how electric power generation and distribution and are easy to be mistified with bullshit accounting concepts such as LCOE. But what matter is the total SYSTEM-WIDE cost of energy.
And there is not a single place in the world where widespread adoption of intermitent non-dispatchable power sources haven't absurdly increased the final costs of electricity for the customers.
Of course, lots of people are making a lot of money out of that, a lot of talking heads have their careers based on that and they will say otherwise. So, just move to germany, california, UK or south Australia, enjoy your expensive electric bills, and stop worrying and learn to love increasingly frequent blackouts.
It is not that intermitent renewables are useless and can't be a part of the grid under some constraints. Also, if you have enough hydro-power potential, go ahead. But otherwise, unless you come up with a magic storage solution, solar and wind can't replace nuclear and thermal more than for a small percentage. And while we are at that, solar in a northern european country is a particularly dumb idea.
The reality nowadays is that for every single GW of renewable capacity generation you forcibly have to have another GW of dispatchable generation, usually natural gas, it is also inescapable that renewables, especially solar, displace baseload generation, reducing its ROI while not eliminating its fixed costs, making energy as a whole more expensive.
Most people have no fucking idea of how electric power generation and distribution and are easy to be mistified with bullshit accounting concepts such as LCOE. But what matter is the total SYSTEM-WIDE cost of energy.
And there is not a single place in the world where widespread adoption of intermitent non-dispatchable power sources haven't absurdly increased the final costs of electricity for the customers.
Of course, lots of people are making a lot of money out of that, a lot of talking heads have their careers based on that and they will say otherwise. So, just move to germany, california, UK or south Australia, enjoy your expensive electric bills, and stop worrying and learn to love increasingly frequent blackouts.
It is not that intermitent renewables are useless and can't be a part of the grid under some constraints. Also, if you have enough hydro-power potential, go ahead. But otherwise, unless you come up with a magic storage solution, solar and wind can't replace nuclear and thermal more than for a small percentage. And while we are at that, solar in a northern european country is a particularly dumb idea.
Yes, renewables are intermittent, but the storage needed to deal with this is rapidly becoming cheaper. No natural gas is needed, although the last few percent of storage shouldn't be batteries. Burning hydrogen in turbines would work, and that can be sourced renewably.
Nuclear is so out of the running economically that even with the (rapidly falling) cost of dealing with intermittency, renewables come out ahead.
Nuclear is so out of the running economically that even with the (rapidly falling) cost of dealing with intermittency, renewables come out ahead.
> Nuclear is so out of the running economically that even with the (rapidly falling) cost of dealing with intermittency, renewables come out ahead.
Only if you do the funny math of LCOE. Because in the real world, in terms of system wide costs, this is laughable opposite to reality. More intermitent renewables -> Higher electricity bills, more grid instability.
And no, storage costs are not even close to be economically viable.
The biggest battery systems are able at most to cover the demand of a metropolitan area for a few hours by themselves. What you do in the winter on moderate to higher latitudes with fewer hours of daylight and the sun down in the horizon with very few wind?
Only if you do the funny math of LCOE. Because in the real world, in terms of system wide costs, this is laughable opposite to reality. More intermitent renewables -> Higher electricity bills, more grid instability.
And no, storage costs are not even close to be economically viable.
The biggest battery systems are able at most to cover the demand of a metropolitan area for a few hours by themselves. What you do in the winter on moderate to higher latitudes with fewer hours of daylight and the sun down in the horizon with very few wind?
No, the funny math is typically from the nuclear advocates.
A usual bit of dishonesty you see from them is computing the cost of firming intermittent sources by assuming batteries are the only storage used. This massively inflates the cost, since batteries are unsuited for certain storage use cases (rare correlated outages, seasonal storage) for which there are other, cheaper options. They can massively inflate the cost by doing this kind of strawman engineering. Nuclear bros lap up the numbers produced by this sort of fraud and repeat them unquestioned.
Careful analysis using all the options for dealing with intermittency (storage is not even close to #1) reveals that renewables are very affordable.
But anyway: if nuclear really is so much better, it doesn't need subsidy. So let's let them compete head on. I don't think nuclear can survive if that happens though, since no unsubsidized nuclear power plant has ever been built, anywhere, selling into a competitive market.
The whining about nuclear opposition eventually boils down to complaint that nuclear isn't being given the massive public subsidy it would need to get anyone to actually choose to build it.
A usual bit of dishonesty you see from them is computing the cost of firming intermittent sources by assuming batteries are the only storage used. This massively inflates the cost, since batteries are unsuited for certain storage use cases (rare correlated outages, seasonal storage) for which there are other, cheaper options. They can massively inflate the cost by doing this kind of strawman engineering. Nuclear bros lap up the numbers produced by this sort of fraud and repeat them unquestioned.
Careful analysis using all the options for dealing with intermittency (storage is not even close to #1) reveals that renewables are very affordable.
But anyway: if nuclear really is so much better, it doesn't need subsidy. So let's let them compete head on. I don't think nuclear can survive if that happens though, since no unsubsidized nuclear power plant has ever been built, anywhere, selling into a competitive market.
The whining about nuclear opposition eventually boils down to complaint that nuclear isn't being given the massive public subsidy it would need to get anyone to actually choose to build it.
Again. The real world. Tell me how how much bills have been lowered in California, Germany and the UK.
Tell me about how China installed two orders of magnitude more renewables than nuclear last year.
Germany could power their entire grid using only Organic, fair-trade, hand-picked, artisanal Uranium and still be far ahead of relying on fracked gas and petroleum.
Wind and Solar are great, but still require peaker plants to maintain 24x7x365 power. Grid-scale storage is coming along, but is still cost-prohibitive to do something like power the grid overnight from solar.
Wind and Solar are great, but still require peaker plants to maintain 24x7x365 power. Grid-scale storage is coming along, but is still cost-prohibitive to do something like power the grid overnight from solar.
Until storage is solved (and it might not ever be), then nuclear is excellent for base load. Germany lacks coast line for wind and is in northern europe. Nuclear is ideal for them.
Uranium is not required for nuclear energy. We have other elements that work, like thorium.
Which is used by... transmuting it into uranium (U-233, to be precise.)
Nope, we can do it direct using alphavoltaics.
Exploiting the alpha decay of thorium? If we fully capture the alpha decay energy from the decay chain of Th-232, we get about 24 milliwatts per ton of Th-232. That doesn't seem practical at all.
> absurdly stupid sanctions on Russian Oil and Gas,
do you want to enable people who wage aggressive wars or what?
do you want to enable people who wage aggressive wars or what?
Man, that's the kindergaten view of international relations and war. Really, that's not how the real world works and things have a lot more layers than this cheap naivety.
At the bare minimum, if the US can bomb and invade countries thousands of kilometers away from its borders due to their alleged security interests we should take into account the probability that Russia as a nation-state follows a similar logic when dealing with a country that borders them.
It is not like the US is some kind of exceptional entity that have some special rights to act in certain ways that are verboten for other countries.
At the bare minimum, if the US can bomb and invade countries thousands of kilometers away from its borders due to their alleged security interests we should take into account the probability that Russia as a nation-state follows a similar logic when dealing with a country that borders them.
It is not like the US is some kind of exceptional entity that have some special rights to act in certain ways that are verboten for other countries.
I speak as a Russian. In the US, you have your own protestors for those issues, which I am not qualified to discuss.
So, you really think there was no reason for alarm with NATO encroachment on Ukraine? You really had no issue with the repression of ethnic russians in regions that historically were Russian before Lenin?
You really had no issue with the repression of ethnic russians ...
Which consisted of what, precisely?
in regions that historically were Russian before Lenin?
Are you suggesting that there's some magical, enduring quality to the Russian Empire's territorial claims? Is every place the Russian Empire managed to sit on for a while ipso facto "historically Russian" -- and we should just accept this description at face value?
And before these regions were supposedly "Russian" -- what were they? What kind of people were living there? What became of them?
Would you refer to Okinawa as "historically Japanese", or Algeria as "historically French"?
Enlighten us, please.
Which consisted of what, precisely?
in regions that historically were Russian before Lenin?
Are you suggesting that there's some magical, enduring quality to the Russian Empire's territorial claims? Is every place the Russian Empire managed to sit on for a while ipso facto "historically Russian" -- and we should just accept this description at face value?
And before these regions were supposedly "Russian" -- what were they? What kind of people were living there? What became of them?
Would you refer to Okinawa as "historically Japanese", or Algeria as "historically French"?
Enlighten us, please.
s/b "Enlighten, please"
I'm wondering how you're proposing to power cars with nuclear energy, if not electric cars? Are you proposing synfuels? These are very expensive. Hydrogen cars are notably for how much of a failure they've been, even in places like Japan that have been heavily pushing them.
This is reminding me of Motorola, or really any of the old cell phone companies that were blown away by Apple and smart phones. It was easier to get a company that was good at software to make phones, than it was to make a company that was good at phones to make software.