Automotive

The idea of the best technology winning is a noble one for sure. Historically it has not been the way in the automotive industry. The ICE propulsion did not become dominant due to its inherent advantages back in the day but due to a concerted political and regulatory effort. This led to a similar situation that was attempted recently with electric - it gave manufacturers investment clarity and very soon the technology was naturally dominant due to the effects of the cumulative R&D poured into it and the corresponding experience curves. 

I am with you that China has made a long term strategy that plays to its advantage, where electric is a key component. Trying to play catch up in the ICE world would not be economically the most sensible approach for them. This way they reframed the competitive landscape and threw down the gauntlet, if you wish. As many of the established car manufacturers became disproportionately dependent on the Chinese market over the last 40 or so years, this of course had an effect. Not only on volumes - the Chinese market has been the most profitable one for most for a very long time. There is some misunderstanding that the Chinese will want to dominate the global automotive markets sooner or later. While that might be the case, simply squeezing the established players from the Chinese market might suffice to change the landscape of the industry markedly. 

There are different ways of dealing with the situation. One would be for established manufacturers to continue producing the existing kinds of vehicles, which they knew how to make well. Even neglecting the environmental impact, this would mean slowly having to give up key markets, as those cars would either be squeezed out or no longer be competitive anymore. Another is to compete at the same game. There is enough engineering capacity, knowledge and financial strength there with the large ones to successfully make the transition, even if they play catch up. What most cannot do, though, is play catch up in terms of electric, while concurrently developing hydrogen (a complete waste of time for passenger cars anyhow), ICE / hybrid…

Where the Germans manage to shoot themselves in the foot further - from an industrial point of view - is by not finally adopting a speed limit on their autobahns. As you will know from my posts, I thoroughly enjoy the ability to drive fast legally on the highways here but for the car industry it has turned from a source of competitive advantage to one of disadvantage. The significant resources invested into making cars that perform well in what is ca. 4% of the world market could be used much more profitably in other areas. If nothing else, you could make much more efficient engineering choices, giving you the necessary profitably to invest in the more important aspects for winning the race for tomorrow. 

Again - personally I enjoy a good handling, fast car more than most but from an industry perspective this is not where one wins, as examples like Lotus, Alfa, Maserati, Jaguar and many others demonstrated over the past decades. 

I am also not in the business of trying to convince people to switch to electric propulsion - as long as there is choice, to each their own (and I don’t drive an electric car myself). At the same time, I have a lot of understanding for why a regulatory framework might be helpful for the automotive industry, in spite of what the odd lobbying organization or automotive CEO might say in an interview (remember, their incentives are much more closely aligned with the next several quarters than with the long term health of the company).