The high level of European industry specialisation in producing high quality ICEs accounts for its leading position in the market. However, electric vehicles do not require the same level of know-how, opening the door to other players. China became the top global car exporter in 2023, exporting mostly to Europe and Asia.

Okay, fine. But so what? There is no way that the world is going to continue to use ICEs in the long run. You could say "German auto manufacturers have a comfortable, entrenched position, so we want to defer transition away from ICEs for a year", but you're not going to hold things there.

The EU automotive sector has traditionally excelled at producing vehicles with internal combustion engines (ICEs). The sector accounts for around 8 % of the EU’s gross domestic product (GDP) and for 12.9 million direct and indirect jobs. However, the green transition, digitalisation and global competition have fundamentally altered its business model.

Yeah, technology changes over time.

Promoting electric cars may lead to market distortions that run counter to European industrial interests. While complementary measures such as those contemplated in the critical raw materials act take effect, and besides the obvious move towards public transport, one way to allow the EU car industry to adapt while still reducing CO2 emissions could be to limit the size, weight and engine capacity of urban vehicles.

Learn to make electric vehicles, Germany. If you want to ban outside competition to the European market, then straight-up ban outside competition to the European market. Sitting on ICEs has to be the most ridiculous way to do industrial protectionism one can imagine.

You knew that this was coming down the road for ages. Every industry needs to deal with technological change, whether it's farmers shifting from oxen to tractors or the post office dealing with the shift to telecommunications or farriers dealing with the shift from horses to cars.

China also dominates production of almost every raw material, technology and component used to make electric vehicles.

That's not because China is mining everything, but because it's dominant in processing. If you want to bone up on processing, go for it. Germany's had a history in the chemical industry too. BASF is the largest chemical company in the world today.

https://www.theguardian.com/business/2023/sep/23/the-east-german-town-at-the-centre-of-the-new-gold-rush-for-lithium

The dependency is also unnerving German and other European car manufacturers, whose home markets are now threatened by good-quality Chinese cars and China’s control of the processing of lithium.

Concern is so great that the European Commission president, Ursula von der Leyen, has launched an anti-subsidy investigation into Chinese imports, amid fears that big manufacturers including Volkswagen and BMW will have trouble matching the supply of electric cars from China.

But lithium does not, in the main, come from China, so how has Beijing achieved such a commanding position? Was Europe asleep at the wheel?

Lithium supplies are dominated by five countries, with the bulk of the mineral mined in Australia and Chile, but it is China that has taken the raw material and become the dominant supplier of refined lithium.

“They are now the global hub. This gives them economic leverage – or, to put it more bluntly, the means of economic coercion,” says one EU source.

Hell, even if it were mining, Germany has far higher known per-capita lithium reserves than China does; just isn't mining it.

https://worldpopulationreview.com/country-rankings/lithium-reserves-by-country

Total lithium reserves in megatons:

China: 5.10

Germany: 2.70

Europe as a whole has comparable lithium reserves even in absolute terms.