German car supplier ZF Friedrichshafen stops combustion engine development

German car industry supplier ZF Friedrichshafen is to discontinue development for combustion vehicles, CEO Wolf-Henning Scheider said in an interview with the Frankfurter Allgemeine Zeitung (FAZ). Germany’s third largest supplier of cars has diverted all development resources to new technologies, which can contribute significantly to the range and efficiency of electric cars, Scheider said. “We are preparing ourselves for the fact that in 2035, hardly any internal combustion engines will still be sold in Europe, and perhaps none at all in the passenger car sector,” Scheider told FAZ.

The take-up of electric vehicles has been slow in Germany in comparison to many other markets, but in 2020 numbers of newly registered e-cars rose significantly. The German car industry has committed to climate-neutral mobility by 2050, but some companies reject a sole focus on electric mobility and insist that efficient combustion engines and synthetic fuels are also key to achieving climate targets. While the country's major carmakers focus heavily on electric mobility, its large supplier industry often insists on pursuing alternative technologies, especially hydrogen fuel cells and synthetic fuels made on the basis of renewable hydrogen.

In the meantime, Der Spiegel reported that Chinese manufacturers are increasingly exporting electric cars to Europe. Just under 18,000 Chinese battery-powered vehicles were registered in Europe from January to November 2020, according to market analysis provider Jato Dynamics. In the same period the year before there were just 391, Der Spiegel writes. Although the numbers remain low so far, European car manufacturers should take the competition seriously, experts told Der Spiegel. "What we are experiencing now is a vanguard,” said Stefan Bratzel of the Center of Automotive Management in Bergisch-Gladbach. "The Chinese cars that are on the market in Europe today have to be taken seriously," management consultant Jochen Siebert added. European car buyers can expect more diversity in the future, in part because the EU is considered one of the next big growth markets for e-cars, Der Spiegel writes. "In 2025, we expect China to produce two million battery-powered vehicles per year, compared with four to five million in Europe," Siebert told Der Spiegel.