The anticipated reversal of the planned 2035 European combustion engine ban is triggering sharp criticism from leading economists, raising serious questions about its long-term impact on German industry and employment. Monika Schnitzer, chair of the German Council of Economic Experts, warned in the Süddeutsche Zeitung that the revised policy fails to address the current challenges faced by automakers and offers no guarantee of safeguarding industrial jobs within Germany. She expressed skepticism that delaying the ban would actually preserve those jobs, suggesting instead the opposite effect might occur.
Brussels is expected to formally unveil the revised plans on Tuesday, signaling an end to the complete ban on new combustion engine vehicles within the EU. The German government has previously advocated for this shift, but the move is now attracting significant scrutiny. Schnitzer highlighted the risk of sending contradictory signals to businesses, many of which have already made substantial investments in electric vehicle technology. While superficially the change may appear to favor German manufacturers, she cautioned, “It’s a short-term advantage, at best. Today, nobody uses a ‘tastenhandy’ [button phone] anymore.
The criticism isn’t limited to Schnitzer. Thomas Puls, from the industry-affiliated Institute of German Economics (IW), Sebastian Dullien of the labor union-aligned IMK and Anita Wölfl from the Ifo Institute in Munich, all voiced similar concerns. Puls characterized the debate as largely symbolic, arguing that electric vehicles and plug-in hybrids will remain the superior product for most applications by 2035, regardless of the policy change.
Sebastian Dullien emphasized that the root of the difficulty faced by German manufacturers isn’t the combustion engine ban per se, but rather a technological deficit, particularly in the area of battery cell production. He questioned the motives of automotive executives, asking whether they prioritize short-term profit maximization over the long-term health of the industry and the security of employees’ jobs.
Anita Wölfl added a critical perspective on the industry’s approach, arguing that the prolonged pursuit of a dual-track strategy – simultaneously developing both electric and combustion engine vehicles – has become unsustainable. She observes that many manufacturers are already curtailing investment in gasoline and diesel technologies, raising doubts about the feasibility of producing novel combustion engine models in the coming years. The policy shift, critics warn, risks entrenching a technologically lagging position for German manufacturers and potentially hindering the nation’s transition towards a sustainable automotive future.