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Germany's days as an industrial superpower are coming to an end

bloomberg.com

151–157 of 157 posts

Re: Germany's days as an industrial superpower are coming to an end

#151

Germany's strategy has been to offer higher quality products at a huge markup. Just using the auto industry as an example, in the past twenty years the difference in quality between a mass market vehicle and a luxury vehicle has compressed. Competing on quality seems to be getting harder. The Anglophone economies, whose shift to services away from manufacturing has been ballyhooed and decried in many quarters, embrac…

The problem with the "Anglophone" strategy of focusing on ideas -- like the old "Designed in California. Assembled in China" statement that used to be on Apple iPods, is what happens when China (and elsewhere) start having their own designers (which is starting to happen)? What value will California provide then?

California can still ace software in the long run. Second the secret sauce with apple isn't physical hw or software but the ability to set out both in a integrated fashion and actually get all the parts to hit targets to deliver.

Beating apple on software (linux?) is one thing. Ditto hw. Both at the same time is tougher.

Apple is operationally strong.

That won't leave to China either. Sure they've messed up etc etc but nothing life threatening

Re: Germany's days as an industrial superpower are coming to an end

#152
post #115

Im Polish. 20 years ago my parents were taking 1-2 months of PTO every year to work on German farms. 2 months * 2 people and you could’ve renovated a whole mid-sized flat or get a decent 3 years old car. Now I’m making 2-3x more after taxes than my German friends. Yes, I’m self employed and yes I’ll need to take care of my own retirement but I’ll be better off after 1-2 years of putting $100k in ETFs than they could…

Here in Western Europe (West) Germany has always been known for its bad wages. Was it Mitterrand who likened German workers to the Chinese, or was it even before that?

Re: Germany's days as an industrial superpower are coming to an end

#153

I've lived in Berlin for fifteen years now. My view is very different from what this article is portraying. Germany definitely has issues. Some of them are short term issues. Some of them self inflicted. And others have been issues for a long time. But all of these are fixable. All it takes is change. Change is hard for Germans but if you look at their history, you see that that wasn't always the case. They are hard…

> 2) There's an energy crisis that was caused by the Russians Didn't EU sanctions cause the energy crisis ? How did the Russians cause it ? From someone who is not in the NATO sphere, I can only marvel at how Germany can suicide themselves so effectively. Now, they are buying Gas from the U.S at 2-4x prices. The U.S. gas billionaires laugh their way to the bank while Germans fall into poverty.

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Re: Germany's days as an industrial superpower are coming to an end

#154

Germany's strategy has been to offer higher quality products at a huge markup. Just using the auto industry as an example, in the past twenty years the difference in quality between a mass market vehicle and a luxury vehicle has compressed. Competing on quality seems to be getting harder. The Anglophone economies, whose shift to services away from manufacturing has been ballyhooed and decried in many quarters, embrac…

[dead]

Re: Germany's days as an industrial superpower are coming to an end

#155
post #151

Earlier quoted context omitted.

The problem with the "Anglophone" strategy of focusing on ideas -- like the old "Designed in California. Assembled in China" statement that used to be on Apple iPods, is what happens when China (and elsewhere) start having their own designers (which is starting to happen)? What value will California provide then?

California can still ace software in the long run. Second the secret sauce with apple isn't physical hw or software but the ability to set out both in a integrated fashion and actually get all the parts to hit targets to deliver. Beating apple on software (linux?) is one thing. Ditto hw. Both at the same time is tougher. Apple is operationally strong. That won't leave to China either. Sure they've messed up etc etc b…

Huawei had achieved phones with a really strong hardware+software combination. Before sanctions, it had surpassed 20% market share in Europe (https://www.statista.com/statistics/1232281/huawei-smartphon...).

Then the US sanctions, supposedly unrelated to the mobile phone market, hit Huawei hard making it pretty much undesirable to buy their phones in the Western market, and its market share in Europe plunged to near zero. How convenient.

Spanish forums and social networks are still full of "Huawei orphans" who can't find any Android phone in the current market that can match the quality of the pre-sanctions Huawei P20/P30/P20 Pro/P30 Pro flagships. It's a recurrent post topic. I'm one of them, and I'm even considering switching to Apple. My current phone (Pixel 6 Pro) doesn't even come close to my previous Huawei P30 Pro in battery life, signal reliability, heating issues, etc. and it's the same for every other Android model I've seen from family/friends. While it does have great camera and software, in many respects it feels like more of a downgrade than an upgrade. At least I can keep using my Huawei smartwatch which gives me two weeks of battery life, rather than a few days like most of the competition.

With this I mean... China is very capable of developing high-quality products like California, but California can leverage its political and military power to tilt things in their favor. At least at the moment.

Re: Germany's days as an industrial superpower are coming to an end

#156
post #151

Earlier quoted context omitted.

California can still ace software in the long run. Second the secret sauce with apple isn't physical hw or software but the ability to set out both in a integrated fashion and actually get all the parts to hit targets to deliver. Beating apple on software (linux?) is one thing. Ditto hw. Both at the same time is tougher. Apple is operationally strong. That won't leave to China either. Sure they've messed up etc etc b…

Huawei had achieved phones with a really strong hardware+software combination. Before sanctions, it had surpassed 20% market share in Europe ( https://www.statista.com/statistics/1232281/huawei-smartphon... ). Then the US sanctions, supposedly unrelated to the mobile phone market, hit Huawei hard making it pretty much undesirable to buy their phones in the Western market, and its market share in Europe plunged to nea…

As an American, I'd never even seen a Huawei device until I saw a Huawei table at a Yodabashi in Japan, and you aren't kidding about quality. They're what Samsung could be if they actually had their shit together.

That said, I don't believe the sanctions are at all an anti-competitive move; the threat of hardware (Huawei, DJI) and software (TikTok) backdooring is very real. The sanctions hit more than just phones anyway-- Huawei routers are also affected.

Re: Germany's days as an industrial superpower are coming to an end

#157
post #31

The article lists a lot of things going bad for Germany. But was there some underlying reason? Like demographics, shrinking population? Or is it just the obvious , Russian gas, rising Energy costs, now their prices are too high, so exports are down.

Several decades of politics and industry kicking the can down the road and hoping that the challenges go away by itself. For example: German car makers are still somewhat reluctant to embrace electric motors (no matter the power source or storage) and would like to stay with combustion engines (no matter the combustible) because that's a niche they and the entire downstream industry feel comfortable with. Yes, a larg…

https://dserver.bundestag.de/btd/20/102/2010284.pdf has a list of railway infrastructure elements (track switches, bridges, overhead electrical lines, rail tracks, track crossings, signal boxes, support structures) that are, while still safely usable, in the condition categories "einschränkend" (limiting), "schlecht" (bad), and "mangelhaft" (deficient) - that is, the condition categories that require some kind of maintenance and might reduce efficiency of the rail network. Starts on page 9, ends on page 494.
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