According to a recent study by Ernst & Young, the German car makers VW, Daimler and BMW have invested €4.7 billion worldwide in the last two years in pure electric vehicle technology. This figure by far surpasses investments made by American (€335 million) and Japanese (only $19 million) manufacturers.

According to the EY study, the German automotive industry is increasingly under pressure to produce vehicles with low-emission technologies, which is probably why it has become the world's largest investor in electric cars. There are some other interesting numbers in the study: The combined investment for electric cars of the world's largest 16 manufacturers in Germany in the last two years was around €3.2 billion. This is also much more than combined investment in China (€ 990 million) and in the US (€887 million).

The size of the investments is in striking contrast to the current market share of electric vehicles and German manufacturers are currently lagging behind its competitors such as BAIC from China, Renault-Nissan and Tesla. The electric car initiative with government incentives to encourage the purchase of clean vehicles is set to reach a goal of 1 million electric cars by 2020 but has so far not even achieved 20% of the target. Investments by the German car industry are however already starting to bear fruit with several new models in the pipeline, ready for launch in 2019 and 2020.

Pressure is on the industry after discovery of the in-built VW diesel emission ‘workaround’ and also by the recent decision of several German city councils to ban older diesel vehicles from city centres. In addition, there are compulsory quotas for electric cars in China, the main sales market for German luxury-class sedans. About 70% of all premium cars in the world come from Europe -- 41% of all top-of-the-range vehicles come from Germany alone.
The consequences of this push to electric vehicles include VW investment of just under €2 billion for the conversion of two factories in Germany while Daimler is planning its own battery plant in the US. The crisis has apparently has been met with a positive response from the once lethargic German car industry and we can look forward with interest to new developments from Europe in the electric vehicle scene.