Germany Falls into Recession
China is outcompeting Germany as a manufacturer of high value goods, particularly cars [1][2]. Last year it overtook Germany as the second biggest car exporter. In the first three months of this year, China has surpassed Japan to become the world&#x27;s top car exporter for the first time. This is due to its strength in EVs (while Germany&#x27;s strength is in ICEs). Volkswagen holds a 2% share of the Chinese EV market while the Chinese BYD dominates with 40% (Tesla in second at 10%) [3]. It won&#x27;t be long until Europe imports more cars from China than China imports cars from Europe. If you had said this only a few years ago most Europeans would have laughed in disbelief.<p>With a world moving away from ICE to EV, and with Chinese brands winning at home and abroad, it presents a double whammy nightmare for Germany. Lowered exports to China, plus lowered exports in other markets. And this is all on top of energy prices from the fallout of the conflict in Ukraine, the shut down of nuclear power thanks to the Greens and the geopolitical tensions between the West and China.<p>While Germany&#x27;s economic model has served it well during an era of a rising China, it may not be the case in a era of a risen China.<p>[1] China’s carmakers outstrip foreign brands in its electric vehicle boom
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